Statute Details
- Title: Variable Capital Companies (Modifications to Subdivision 5 of Division 4 of Part X of Companies Act for Sub-funds) Regulations 2020
- Full Title: N/A
- Act Code: VCCA2018-S25-2020
- Type: Subsidiary Legislation (sl)
- Commencement Date: 14 January 2020
- Parts: N/A
- Key Sections: N/A
- Related Legislation: Companies Act, Variable Capital Companies Act 2018
What Is This Legislation About?
The Variable Capital Companies (Modifications to Subdivision 5 of Division 4 of Part X of Companies Act for Sub-funds) Regulations 2020 is a piece of subsidiary legislation enacted under the Variable Capital Companies Act 2018. It modifies the application of Subdivision 5 of Division 4 of Part X of the Companies Act to sub-funds under a variable capital company (VCC).
The purpose of this legislation is to adapt the provisions in the Companies Act relating to the striking off and dissolution of companies to the context of sub-funds within a VCC. This is necessary because a VCC is structured differently from a traditional company, with the VCC itself being the legal entity and the sub-funds operating as segregated portfolios within the VCC.
What Are the Key Provisions?
The key provisions of this legislation are the modifications it makes to the application of Subdivision 5 of Division 4 of Part X of the Companies Act to sub-funds of a VCC. These modifications are set out in Regulation 2 and can be summarized as follows:
Terminology Changes: References in the Companies Act to a "company" are to be read as references to the "sub-fund", and references to "members" are to be read as references to members of the umbrella VCC holding shares issued in respect of the sub-fund. Similarly, references to the "registered address" and "constitution" are to be read as references to the registered address and constitution of the umbrella VCC.
Dissolution Process: The process for striking a company off the register is to be read as a declaration of the dissolution of the sub-fund. Upon dissolution, the Registrar must immediately delete the particulars of the sub-fund from the register in which it is registered.
Winding Up: References to the winding up of a company are to be read as references to the winding up of the sub-fund. An application under Section 344A of the Companies Act for the Registrar to strike a company off the register is to be made by the directors of the umbrella VCC.
Books and Records: References to the books and papers of a company are to be read as references to the books and papers in respect of the sub-fund.
Omitted Provisions: Certain sections of the Companies Act relating to the striking off and dissolution of companies are omitted and do not apply to sub-funds of a VCC.
How Is This Legislation Structured?
This legislation consists of two main parts:
1. Citation and Commencement (Regulation 1): This provision sets out the title of the regulations and the date they came into operation (14 January 2020).
2. Modifications to Subdivision 5 of Division 4 of Part X of Companies Act (Regulation 2): This is the core of the legislation, outlining the various modifications to the application of the relevant provisions of the Companies Act to sub-funds of a VCC.
Who Does This Legislation Apply To?
This legislation applies to sub-funds of variable capital companies (VCCs) registered in Singapore. A VCC is a type of investment fund vehicle that allows for the establishment of multiple sub-funds, each with their own investment portfolio and share classes, under a single legal entity.
The modifications made by this legislation ensure that the provisions in the Companies Act relating to the striking off and dissolution of companies are appropriately adapted to the VCC structure, where the VCC itself is the legal entity and the sub-funds operate as segregated portfolios within the VCC.
Why Is This Legislation Important?
This legislation is important because it provides the necessary legal framework for the dissolution and winding up of sub-funds within a VCC. Without these modifications, the provisions in the Companies Act relating to the striking off and dissolution of companies would not fit the VCC structure, creating legal uncertainty and potential issues.
By clearly specifying how the relevant Companies Act provisions are to be applied to VCC sub-funds, this legislation helps to ensure the orderly and efficient dissolution of sub-funds when necessary. This is an important aspect of the overall regulatory regime for VCCs, which are intended to provide a flexible and efficient investment fund structure for fund managers and investors.
Importantly, the modifications made by this legislation help to preserve the segregation of assets and liabilities between the sub-funds of a VCC, which is a key feature of the VCC structure. This protects investors and ensures that the winding up of one sub-fund does not impact the other sub-funds within the same VCC.
Related Legislation
- Companies Act (Chapter 50)
- Variable Capital Companies Act 2018
Source Documents
This article provides an overview of the Variable Capital Companies (Modifications to Subdivision 5 of Division 4 of Part X of Companies Act for Sub-funds) Regulations 2020 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.