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February 2017
MAS provides guidance on regulatory aspects for single family offices

With the growth of Singapore as a wealth management centre, there are many single-family offices ("SFOs") operating in Singapore. SFOs do not need to hold a Capital Markets Services licence for Fund Management or a Financial Advisers licence, provided they come under the appropriate exemptions under the Securities and Futures Act (Cap. 289) ("SFA"), Financial Advisers Act (Cap. 110) ("FAA") or regulations made thereunder.

The regulatory status of SFOs is a common query among market participants, and the Monetary Authority of Singapore ("MAS") has now provided guidance on this aspect in the revised FAQs on Licensing and Registration of Fund Management Companies issued on 6 February 2017.

The term "single family office" is not defined in the SFA, but is understood in the industry to mean an entity that manages assets for only one family and is wholly owned or controlled by members of the same family. The term "family" is to be understood in this context as meaning close family members, and not any or all relatives.

MAS has stated that it is not the intention of MAS to regulate SFOs. SFOs can rely on exemptions from licensing for the provision of fund management and financial advisory services to related corporations under the regulations made under SFA and FAA. By way of illustration, a family holding company that has two wholly owned subsidiaries, one acting as the SFO, and the other acting as the fund entity, would be able to rely on the "related corporations" exemption.

MAS has further stated that an entity that is in substance managing funds on behalf of a single family only, but that does not fall within the scope of existing licensing exemptions due to issues of technical interpretation, may seek a licensing exemption from MAS. This could be in situations where, for example, the assets managed by the SFO are held directly by natural persons of a single family and there is no family holding company, or where assets are held under a discretionary trust, and the settlor of the trust and the beneficiaries are members of the same family. Such exemptions will be granted by MAS on a case by case basis.

For more information, please contact us to find out more.

Partner Partner
T: +65 6349 8729 T: +65 6349 8680
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