Valsen Fiduciaries has been a leading partner for investors seeking to apply for a mutual fund license in Labuan. A mutual fund or fund means a Labuan company, a corporation incorporated under the laws of any recognized country or jurisdiction, a partnership, a protected cell company, a foundation or a unit trust which:
- Collects and pools funds for the purpose of collective investment with the aim of spreading investment risk; and
- Issues interests in a mutual fund which entitles the holder to redeem his investments that is agreed upon by the parties and receives an amount computed by reference to the value of a proportionate interest in the whole or part of the net assets of the aforesaid types of entities, as the case may be, and includes an umbrella fund whose interests in a mutual fund or units are split into a number of different classes of funds or sub funds and whose participants are entitled to exchange rights in one part for rights in another.
Private funds are mutual funds:
- Whose securities are owned or held by:
- Not more than 50 investors where the first-time investment of each of such investors is not less than RM250,000 or such other sum as may be prescribed by Labuan FSA or the equivalent in any foreign currency; or
- Any number of investors where the first-time investment of each of such investors is not less than RM500,000 or such other sum as may be prescribed by Labuan FSA or the equivalent in any foreign currency; or
- Which is designated as a private fund under regulations made under the Labuan Financial Services and Securities Act 2010.
Islamic private funds are private funds with similar definition to the above and are in compliance with Sharia principles.
Notification Requirements
A private fund can carry on its affairs by giving notice in writing of its scope and nature of business to Labuan FSA. The notification shall be accompanied with an information memorandum or such other offering document and should be lodged through a Labuan licensed entity. The information memorandum or such other offering document will be deemed as a prospectus and a lodgment fee of RM 2,000 (USD600) is applicable.
Operational Requirements of Labuan Private Fund
- The issuer of the private fund must provide a copy of the Information Memorandum to each of the investor
- May appoint fund manager, fund administrator or other service providers. If appointment is made, to submit an audited financial statement of its promoter and fund manager, where applicable, for the three preceding years along with the lodgment of Information Memorandum
- The shareholder and every members of the Board of the private fund including any other relevant person are fit and proper persons in accordance with the Guidelines on Fit and Proper Person issued by Labuan FSA
- Labuan Private funds that have reached their maturity period shall notify Labuan FSA in writing within one month after its maturity
- Ensure fair and orderly winding down of the matured fund including having an auditor to ensure that all assets have been properly returned to investors
- Comply with the relevant laws and regulations in the jurisdictions where it intends to operate including obtaining the necessary approval
- Maintain adequate and proper accounting and other records in line with the Directive on Accounts and Record-Keeping Requirement for Labuan Entities issued by Labuan FSA that will sufficiently explain its transaction and financial position and indicate clearly its names on its letterhead, stationery and other documents
- Ensure compliance with the Anti-Money Laundering and Anti-Terrorism Financing Act 2001 and Guidelines on Anti-Money Laundering and Counter Financing of Terrorism which is relevant to Labuan FSA
- Ensure proper policies and procedures are in place for a sound compliance framework which safeguards clients’ interests
- Per lodgment of each Information Memorandum to Labuan FSA fee is RM 2,000 (USD700).
Government Fees
|
Type of License |
Amount |
|
|
Annual License |
RM 2,000 |
USD 600 |
|
|
|
|
Labuan Private Fund Tax Treatment
3% or a flat rate of RM 20,000 (Usd 4927.20)
No withholding tax on distribution to investors
No stamp duty on share transfer
Labuan Private Fund Benefits
- Flexibility in structure-Labuan Private fund can be structured in many forms of Labuan Company, limited liability partnership, and protected Cell Company.
- Product Innovation– support multi-structures, multi-currencies, multi risk instruments, investors with multi risk classes.
- Low minimum capital requirement per investor!
Our Services
We offer a one-stop-shop solution; from the promoter’s idea to successful implementation and administration of investment Funds and vehicles. Valsen offers the following range of solutions that are customised to meet your fund’s needs:
- Assistance with the selection of an appropriate entity for the fund
- Advice in relation to jurisdictional regulations
- Advice on the fund structure
- Assistance with the preparation of constitutional documents
- Incorporation and licensing of the fund company
- Incorporation and licensing of the fund management company
- Drafting the fund prospectus/offering documentation and agreements
- Distribution of offering circulars to prospective investors
- Processing share issues and redemptions
- Communicating with shareholders and providing financial reports
- Maintaining the principal accounting books and liaising with auditors
- Disbursement of dividends, fees, directors’ salaries, overheads
- Holding and keeping minutes of shareholders’ and board of directors’ meetings
- Addressing and providing regulatory compliance
Providing fund administration services, fund accounting and Net Asset Value validation
Why Valsen
- We will advise you on the optimal legal structure for your requirements, size, expectations and circumstances. We have extensive knowledge of a wide range of legal structures in all major jurisdictions. (Securities, Banking, Insurance, Investment Management, Gaming and many more)
- Valsen will assist to complete every form for each process in the best way we know how (Based on our many years’ experience with various regulators and service providers across the world)
- Valsen will assist in preparation of winning business plans based on our superior understanding of regulator expectations and requirements
- We are very hands on in the post filing period checking with re regulator and service providers and updating you regularly. Any queries raised by the regulators and service providers during processing will be quickly synthesized by us and we shall craft the right responses to move the process forward fast.
- We can provide you with fit and proper directors in case you need. We have a wide network of qualified and experienced lawyers, chartered accountants, chartered financial analysts, wealth managers, FX experts, Investment advisors etc. of international pedigree.
- We have a full in-house compliance support for all compliance requirements with the regulator and service providers
- Through our extensive network, we provide sign up services with major service providers including but not limited to; Liquidity providers, technology providers, custodians, prime brokers, legal advisors, auditors, payment gateway providers among others.