What are restricted schemes?
Restricted schemes are exempted from CIS authorisation/recognition and prospectus requirements. They are offered only to "relevant persons" as defined in the Securities and Futures Act (SFA).
Restricted schemes are schemes that are offered only to “relevant persons” as defined in section 305(5) SFA, or at a minimum of S$200,000 per transaction. Restricted schemes are exempted from scheme authorisation or recognition and prospectus requirements, subject to certain conditions being met.
The "relevant persons" stated in section 305(5) SFA mean the following:
- an accredited investor;
- a corporation the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor;
- a trustee of a trust the sole purpose of which is to hold investments and each beneficiary of which is an individual who is an accredited investor;
- an officer or equivalent person of the person making the offer (such person being an entity) or a spouse, parent, brother, sister, son or daughter of that officer or equivalent person; or
- a spouse, parent, brother, sister, son or daughter of the person making the offer (such person being an individual).
MAS must be notified of a restricted scheme.
Restricted schemes must submit a notification to MAS through the CISNet portal and be entered into MAS’ list of restricted schemes, before an offer is made. MAS will enter a CIS into the list of restricted schemes, if –
- The offer is made in or accompanied by an information memorandum that contains salient information about the restricted scheme; and
- The manager is licensed or regulated to manage the scheme property in the jurisdiction of its principal place of business and is fit and proper
Restricted schemes that do not invest in capital markets products (“Restricted Non-CMP Schemes”) and are offered solely to “relevant persons”, are not required to have a licensed or regulated manager. Therefore, these schemes will not be entered into MAS’ list of restricted schemes. However, Restricted Non-CMP schemes must submit certain information to MAS through the CISNet portal before an offer is made.
Restricted Non-CMP Schemes that have a licensed manager and that wish to be entered into MAS’ list of restricted schemes may do so by submitting the online notification required for other restricted schemes.
As a condition for ongoing exemption, all restricted schemes must lodge an annual declaration every 12 months. More information on restricted schemes can be found in section 305 of the SFA and the Sixth Schedule to the Securities and Futures (Offers of Investments)(Collective Investment Schemes) Regulations .