Labuan Private Fund

Introduction

Labuan mutual fund as governed under Part III of the Labuan Financial Services and Securities Act 2010 (LFSSA).

About Labuan Private Fund

Labuan private funds are mutual funds whose securities are not offered to the general public and 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 equivalent in any foreign currency; or
• Any number of investors where the first time investment of each such investors is not less than RM 500,000 equivalent in any foreign currency.

Legal Requirements

Categories

Entity Requirements

The entity making the application is an Labuan company under Labuan Financial Services and Securities Act 2010 (LFSSA) Company includes:
a) Company;
b) LLP;
c) PCC
d) Any other similar body formed under the laws of Labuan

Director’s Requirements

The licensee will need at least 2 (two) natural person Fit and Proper Directors of any jurisdiction.

Shareholder requirements

The Private Fund will need at least one shareholder. Corporate shareholding is allowed and 100% foreign ownership is permitted

Compliance Officer

The Licensee must establish and maintain an appropriate and effective compliance function within the firm which operates independently of all operational and business line functions and senior or supervisory management.

Custodian

No person shall carry on business as a custodian of a private fund unless it is a:
a) Bank Licensee
b) Labuan Trust Company
c) A qualified and authorised trustee or custodian of private funds under the laws of any recognised country or jurisdiction and has received written permission from the Authority to carry on business as a trustee or custodian of a private fund.


• The applicant must have a custodian approved by the authority.
• A Custodian licensed and approved locally the minister.
• A Custodian licensed and approved under the laws of a recognized country or jurisdiction.
• A person with a written permission from the Minister to carry on Business as a Custodian. The proposed fiduciary custodian/trustee may be located in the IOM or outside the IOM, subject to it being:
• a body corporate that —
1. is incorporated in a jurisdiction with which the Authority has a co-operation agreement that includes provisions in relation to collective investment schemes;
2. is authorised to act as a trustee or fiduciary custodian for retail collective investment schemes in its jurisdiction of incorporation; and
3. receives the Authority's approval to act as such in relation to Authorised CIS.

Compliance Officer

The Licensee must establish and maintain an appropriate and effective compliance function within the firm which operates independently of all operational and business line functions and senior or supervisory management.

Auditor

The Licensee, within one month after becoming licensed, The Authority may approve any person to be an approved auditor.

The Applicant must have the prescribed minimum subscription and is able to meet the prescribed minimum net liquid capital requirement in cash or readily marketable securities. The prescribed minimum subscription is RM250,000 (USD 63,000)




Ongoing Obligations

• Annual obligations: Maintain such accounting records and financial statements available for examination by the Registrar or any person authorized under his hand at its principal place of business or registered office in Labuan;
• 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
• Notify Minister within a reasonable period of any of the following changes:
  • Changes in any Key Functionary in the Fund.
  • Change in the registered office address
  • Change of its agent in Labuan
  • Change in name or address of-
    • each director of the fund, if the fund is a company
    • each trustee of the fund, if the fund is a trust
    • Each general partner of the fund, if the fund is a limited partnership.
    • Appointment, resignation or removal of a Director or officer