Citco

The robust supervisory framework and pro-business environment established in Singapore continues to attract leading financial institutions and global investors - this has been particularly the case in recent years, where the financial turmoil and regulatory uncertainty in the West, continues to affect confidence in global financial markets. The Monetary Authority of Singapore (MAS) confirms a continuously increasing interest, from both overseas and indigenous fund managers, to set-up shop in Singapore and to benefit from the Asian growth story.

Singapore is one of the few jurisdictions to have properly understood the alternatives, pre-crisis, and established a regime with compliant structures. One of these vehicles is the so-called Enhanced Tier Fund, a tax incentive scheme enacted in 2009 to attract certain investment funds to be managed from Singapore. The governments goal is to promote Singapore as a leading fund-management hub in Asia.

Over the last 12 months, Citco has seen increased interest from Family Offices in this new structure as a holding vehicle to consolidate investments. Expectations are that with the new regulatory frameworks enacted in the West, more and more Family Offices will choose Singapore as a new domicile for their activities.

Enhanced-Tier Fund
Some features of this enhanced fund management scheme are:

• Specified income from designated investments will be granted tax exemption at the fund level for the entire life of the fund;
• Minimum fund size of SGD 50 million at the point of application;
• The Fund will be open to fund vehicles in the form of companies, trusts and limited partnerships;
• There will be no restrictions on the residency status of the fund vehicles or the investors.

The Enhanced Tier Fund scheme will be effective from April 1, 2009, through March 31, 2014. However, funds that are on the scheme on or before March 31, 2014, will continue to enjoy the tax exemption after March 31, 2014, if they continue to meet the schemes conditions.

Fund managers who are eligible for the Financial Sector Incentive will also enjoy the concessionary tax rate of 10% on income from managing an Enhanced-Tier Fund or providing investment advisory services in relation to an Enhanced-Tier Fund.

For more information please contact Citco Singapore Pte. Ltd.