Revised MAS Guidelines on Licensing, Registration and Conduct of Business for Fund Management Companies to Require Anchoring of Key Individuals

On 16 November 2022, the Monetary Authority of Singapore (MAS) revised its Guidelines on Licensing, Registration and Conduct of Business for Fund Management Companies (FMCs). 

What is this revision about?

These guidelines apply to FMCs holding or applying for a capital markets services licence to conduct fund management (LFMCs), whether they serve retail customers or only accredited and institutional investors, including Venture Capital Fund Managers (VCFMs). The guidelines also apply to registered FMCs (RFMCs).

The guidelines outline among other things conduct of business requirements for RFMCs, VCFMs and LFMCs, including those for reporting and valuation, disclosure, submission of periodic returns, conflicts of interest mitigation and custody.

The 16 November 2022 revision introduced into the guidelines a new section, titled “Anchoring of Key Individuals”, aimed at ensuring stability in FMCs’ Board and management, good corporate governance and alignment of interest with investors.

We summarise the “Anchoring of Key Individuals” requirement:

  • If a FMC is not part of an established business group e.g. where one or more group entities are regulated by a financial market regulator, whether in Singapore or elsewhere, and its shareholders are one or more individuals, whether directly or through holding companies, the MAS will expect the FMC’s CEO and executive directors to collectively hold and maintain more than 50% effective voting interest. This is to enable the CEO and executive directors to exercise effective control over the FMC’s operations, for which they are held accountable under the Securities and Futures Act.
  • The CEO and executive directors of the FMC should not enter into arrangements that allow others to abrogate their controlling rights over the FMC such as agreements forcing the FMC’s CEO or executive directors to cede control of the FMC if certain events occur, and issuance of shares which confer voting rights on a conditional basis.

The genesis for this revision

MAS’ 2021 Licensing & Registration Report for Capital Markets Intermediaries[1] highlighted that many unsuccessful applicants of fund management licences or registrations had passive shareholders with unclear motivations for holding a majority stake in the FMC. The MAS observed that passive shareholders without a meaningful track record in the regulated activity might compromise the ability of the company’s management team to act in the best interests of customers. These shareholders might not share the objective of building a sustainable regulated business and have other reasons to want to own a licensed or registered entity, such as acquiring regulatory credibility to benefit other business ventures.

The MAS reiterated that the management team is accountable for operating the business in the interest of customers and in compliance with applicable laws. Hence, it was important for the management team to adequately control the company’s shares to enable direction of the company’s activities without undue influence from stakeholders with differing interests. Having a management team whose long-term interests were aligned with the company enhanced stability the operations and governance of the company and minimised disruptions that might be detrimental to customers and investors. The MAS stated it would continue to work with FMC applicants on mechanisms to anchor the management team to the FMC and promote stability of the management team such as requiring the CEO and executive directors to collectively own a controlling stake where the shareholders are not part of a regulated financial services group.


In the few months following the 16 November 2022 revision, we have already been busy with advising FMC applicants how they can manage the “Anchoring of Key Individuals” requirement.

Keeping up-to-date with MAS regulations including criteria for licensing and registration applications is vital for any FMC. However, navigating MAS regulations is hard for the layperson. As a consultancy that specializes in advising on compliance with MAS regulations, Integrity Consulting can help you with that. Our team of experienced consultants have provided successful, quality compliance consulting services to various companies in regulated financial services sectors.

Contact us at +65 3105 1515 or visit us at to get in touch with us today!

[1] Microsoft Word – 2021 Authorisations Report – CMI Combined – Final1 (

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