Guide to Apply for Labuan Fund Manager License
Labuan Fund Manager is a person, for valuable consideration, provides management services which may include investment advice or administrative services in respect of securities for the purposes of investment, including dealing in securities. For a Labuan Fund Manager undertaking Islamic fund management activities, its operation shall also comply with Shariah principles.
Labuan Fund Manager License holder under a Labuan Company permissible to perform the following activities:
A. Management Services
* Acting or offering to act as the portfolio manager on behalf of the clients for a portfolio of securities including funds and any foreign fund that has obtained approval from its home regulator of an IOSCO member country.
* Managing activities in the acquisition or disposal of a portfolio of securities including funds (including any foreign fund that has obtained approval from its home regulator of an IOSCO member country).
* Managing clients’ discretionary accounts including Labuan Mutual Funds.
B. Investment Advisory
* Conducting securities analysis and making investment recommendations based on client’s investment objectives and financial situation.
* Providing advice concerning securities including the issuance or promulgation of research report and analysis.
* Providing consultancy and advisory services relating to corporate finance and financial planning matters for corporate clients.
C. Administrative Services
Making submissions on behalf of clients to Labuan FSA in respect of securities including any other reporting requirements including issuing any documents which are deemed to be a prospectus.
D. Dealing in securities
* Quoting two-way prices and dealing in securities.
* Arranging for the sale or purchase of securities including that are not listed on a stock market of a stock exchange, issued by, belonging to or on behalf of clients.
* Underwriting of securities and placement out of such underwritten securities to be commensurate with the adequacy of its financial resource.
* Other dealing in securities as permitted by Labuan FSA.
E. Tax for Labuan Fund Manager Company
All activities carried out by a licensed Labuan fund manager are deemed as trading activities with net profit corporate tax of 3% as per audited account. There will be no tax on the loss incurred, auditing of the financial account is required.
Criteria to apply for Labuan Fund Manager License:
1. An individual who holds a relevant degree or professional qualification to carry on fund management activities. Labuan FSA may also consider an applicant with at least a minimum qualification of diploma holder and 3 years’ relevant experiences in the capital market or direct experiences in fund management activities;
2. An approved fund manager or any provider of such services from a country or jurisdiction who is a member of the International Organization of Securities Commission (IOSCO);
A person who does not fulfill paragraph (1) and (2) may also be considered, provided that the fund management activities are run and managed by suitably qualified and experienced individuals.
In addition, the application is to be accompanied with:
1. A business plan covering the business intentions, types of services to be provided, target market, three years revenue projections and manpower, including the equity structure of the company in regard to the percentage of shareholding.
2. Resume of all keys personnel with education certificates
3. Reference Letters for key personnel and relevant documents to proof fit and proper person
4. Personal financial statement able to demonstrate the existence of adequate financial resources and the continuing financial support for the business.
5. Must have at least two directors in the Company.
Subject to the merit of each application, additional information and documents may be requested by Labuan FSA to facilitate the processing of the application.
Operational Requirements of Labuan Fund Manager Company as follows:
1. To maintain a paid-up capital unimpaired by losses of at least RM300,000 equivalent in any foreign currency throughout its operations. Where the Labuan fund manager has Asset Under Management (AUM) of more than RM150 million, it must maintain additional capital equivalent to 0.2% of the AUM in excess of RM150 million.
2. To maintain a professional indemnity insurance policy with coverage of not less than RM1 million or its equivalent in any foreign currency throughout its operations.
3. To maintain a registered office in Labuan and ensure that the business must be carried on in, from or through Labuan. You may establish a marketing office at Kuala Lumpur and/or Iskandar Malaysia.
4. To ensure the compliance of the duties of a Labuan fund manager including segregation of client’s assets.
5. To establish adequate internal policies and procedures for its operations, compliance, internal controls, corporate governance, and risk management, including its business continuity plan. These have to be regularly reviewed to ensure that they remain appropriate, relevant and prudent.
6. To ensure proper policies and procedures are in place to ensure a sound compliance framework which safeguards clients’ interests.
7. To appoint an approved auditor to carry out an annual audit of its accounts in respect of the business operations. The audited report is to be submitted within 6 months after the closure of the financial year.
8. To conduct its business in any foreign currency other than Ringgit Malaysia. Ringgit is permitted to defray expenses only.
9. To ensure that its risk management plan also clearly sets out the extent of financial requirements to sustain its operational business based on the risk appetite or tolerance levels in relation to the fund management strategies. This has to be reviewed at least on a yearly basis in line with its business plan.
10. To obtain prior approval from Labuan FSA on changes of its identity, place of business or office in Labuan or outside Labuan, ownership, and shareholding of the fund manager.
11. To notify Labuan FSA in writing any amendment or alteration to any of its constituent documents, or business plan within thirty (30) days of the changes being effected.
12. Take reasonable care to organize and control its affairs responsibly and effectively, with adequate risk management and supervisory system.
13. To establish proper compliance function to ensure its business complies with the relevant directive, guidelines and reporting requirements issued by Labuan FSA from time to time.
14. To ensure compliance with the Anti-Money Laundering and Anti-Terrorism Financing Act 2001 and Guidelines on Anti-Money Laundering and Counter Financing of Terrorism relevant to Labuan IBFC.
Fees for Labuan Fund Manager Company payable to Labuan FSA:
a. The annual license fee payable: RM5,000 payable upon approval, up to 31st December. For subsequent years, the annual fee is to be paid on or before 15 January of each calendar year.
b. Marketing Office annual fee payable: RM 7,500 payable upon approval valid until 31st December. For subsequent years, the annual fee is to be paid on or before 15 January of each calendar year.
Our one-stop license application service level for Labuan Fund Manager License include as follows:
* Consultation of your eligibility and procedures based on your profile
* Profiling, due diligence and guidance on the preparation of documents.
* Preparation of Business Plan, Financial Forecast and Operation Manuals
* Submission and supervision of applicant process approval
* Act as your liaison and contact point with Labuan FSA for all correspondence and arrange the interview (if any)
Application Timeframe for Labuan Fund Manager License:
1. 45 to 60 days depending on during the approval processing if Labuan FSA enquire for more supporting documents
2. Key personnel may be required by the Labuan FSA to attend interviews.
Please contact us at +603-2161 0354 or email firstname.lastname@example.org to discovers about Labuan Fund Manager License.