Marketing of foreign collective investment schemes in Singapore

19 February 2025

Singapore, one of the leading wealth management centres in Asia, has traditionally been a home for the assets of the region's high net worth individuals, family offices and institutional investors due to its sound regulatory framework, sophisticated financial infrastructure and political stability which in turn facilitates cross-border fund establishment, capital raising and investments.

We work with a number of international fund managers who look to attract investment from investors in different markets and Singapore, like other global fund jurisdictions, has its own rules regulating such activities.

The regulatory framework for the offers of units in collective investment schemes (CIS) to persons in Singapore is underpinned by the Securities and Futures Act 2001 and its subsidiary legislations (SFA) while the Monetary Authority of Singapore (MAS) regulates fund management activities in Singapore. In this article, we consider how a CIS that is constituted outside of Singapore can be marketed and distributed in Singapore.

Broadly speaking, there are three methods in which an offer of units in an offshore CIS can be made to investors in Singapore:

by way of a public offering through a CIS recognised by MAS as a Recognised Scheme;
by way of an offer made to non-retail investors through a CIS recognised by MAS as a Restricted Foreign Scheme; and
by way of a private placement or an offer made to institutional investors (Exempted Offers).

We set out below a high-level comparative analysis between these schemes, including their respective key requirements to remain compliant with the SFA:

Description	Recognised scheme	Restricted foreign scheme	Exempted offers
Target investors	Retail investors.	Accredited investors.* Any individuals provided the scheme is offered at a minimum of S$200,000 per transaction. *Accredited investors refer to either (i) individuals whose net personal assets exceed S$2 million or whose net financial assets (e.g., bank deposits and prescribed investment products) exceed S$1 million or whose income in the preceding 12 months is not less than S$300,000 or (ii) corporations with net assets exceeding S$10 million.	Institutional investors.* Private placement offering i.e., offer is made to a small group of investors or total amount raised is within certain thresholds (see below for the relevant conditions / eligibility criteria). *Institutional investors refer to the Singapore Government, prescribed statutory boards, sovereign wealth funds, foreign central banks, foreign central governments, prescribed multilateral agencies or international organisations and certain regulated financial institutions in Singapore.
Regulatory approvals	MAS recognition is required. An offshore CIS may only be recognised if it complies with the relevant conditions / eligibility criteria.	While the scheme is exempted from authorisation or registration with MAS (subject to compliance with the relevant conditions / eligibility criteria), such scheme must be notified to MAS for entry into the list of restricted schemes, prior to any offers being made.	Exempted from scheme authorisation or registration with MAS subject to compliance with the relevant conditions / eligibility criteria.
Conditions for recognition or exemption (where applicable)	The laws and practices of the jurisdiction in which the CIS is constituted must afford the investors in Singapore the level of protection equivalent to that provided by the SFA for comparable authorised schemes. Offer is accompanied by an MAS-registered prospectus prepared in accordance with the prescribed requirements under the SFA. The manager is (a) licensed or regulated in the jurisdiction of its principal place of business and (b) fit and proper. The manager should be managing at least S$500 million of discretionary funds in Singapore (unless the units offered have been approved for listing and will be traded on an approved exchange). A local representative has been appointed to act as a liaison between the manager and the investors (which is not required for a Registered Foreign Scheme or Exempted Offer).	Offer is accompanied by an information memorandum prepared in accordance with the prescribed requirements under the SFA (including specific language regarding the restricted nature of the offer). The manager is (a) licensed or regulated in the jurisdiction of its principal place of business and (b) fit and proper. There must be no advertising or promotion of the CIS. No prospectus in respect of the offer is registered with MAS. No selling or promotional expenses are paid or incurred in connection with the offer.	Unless the offer is made to an institutional investor, the following restrictions shall apply: Offer is made to no more than 50 persons within any 12-month period; or Amount raised from each potential investor does not exceed S$5 million within any 12-month period.
Registration of offering documents	Prospectus must be registered with MAS.	Prospectus registration requirements do not apply.	Prospectus is not mandatory. Neither is there a requirement for any other offering document.
Investment restrictions	The CIS would have to be subject to investment guidelines which are substantially similar to those prescribed under MAS' Code on Collective Investment Schemes.	Not required to comply with any specific investment guidelines.	Not required to comply with any specific investment guidelines.

Our international funds practice has significant expertise in advising clients on the establishment of CIS across the UK, Europe, the GCC and in the major offshore fund domiciles for investment in several different jurisdictions. If you would like to discuss any matter referred to in this article, please get in touch with us and we would be happy to explore how we can assist on your offshore investment funds structuring and marketing requirements.

Cassandra Lim

Partner

Singapore