Valsen Fiduciaries Funds

Labuan Public Fund

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

About Labuan Public Fund​

Labuan public funds are those whose securities are offered for subscription to any member of the general public. Labuan public funds may commence business after being registered with the Labuan Financial Services Authority (Labuan FSA) with an approved prospectus of the public fund.

Labuan Public Fund Legal Requirements

Requirements

Description

  1. Applicable legislation

Labuan Financial Services and Securities Act 2010 (LFSSA)

  1. Supervising Authority

Financial Service Authority (FSA)

  1. Corporate vehicle permitted

State the legal form of the fund,

  • Company;

  • LLP;

  • PCC;

  • Any other similar body formed under the laws of Labuan

  1. Share capital or equivalent

    • Minimum subscription

None
    • Minimum investors

None
  1. Directors / Partners / Trustees

    • Minimum number

2

    • Corporate Directors / Partners / Trustees allowed

No
    • Local Directors / Partners / Trustees required

No

  1. Fund functionaries required

    • Custodian

      • Custodian required

Yes

      • Local custodian required

No

      • Eligible custodian

No person shall carry on business as a custodian of a public fund unless it is a:

  • Bank Licensee
  • Labuan Trust Company
  • A qualified and authorised trustee or custodian of public 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 public fund.
    • Fund manager / Investment Adviser

      • Fund manager required

Yes

      • Local fund manager required

No

      • Fund manager requires to be licensed

Yes
      • Eligible fund manager

• A Labuan company who has been granted a licence to act as a fund manager.
• A qualified and authorised manager of mutual funds under the laws of any recognised country or jurisdiction.

  • A bank licensee.
  • A fund manager who is carrying on fund management activities in relation to a private fund
    • Fund administrator

      • Fund administrator required

Yes

      • Local fund administrator required

No

      • Eligible fund administrator

  • A Labuan company or Labuan trust company and has been granted a licence to act as a fund administrator.
  • A Bank licensee.
  • A securities licensee
  • A management company
  • A person who is and continues to be a qualified and authorised fund administrator of mutual funds under the laws of any recognised country or jurisdiction
  • A fund administrator who is carrying on fund administration activities in relation to a private fund
    • External auditor

      • External auditor required

Yes

      • Local external auditor required

No

      • Eligible external auditor

The Authority may approve any person to be an approved auditor.
  1. Asset Requirements

    • Restriction on type of asset class invested

None

    • Asset diversification requirements

None

    • Limitation on size of the fund or total assets under management

None

  1. Local physical office required

No

  1. Prospectus / Offering Memorandum required to be filed

Yes

  1. Eligible for listing

Yes

  1. License fees

    • License application fee

RM 2,000

    • Annual license fee

RM 2,000

  1. Estimated license processing duration

3 months

Ongoing Obligations

Requirements Description
Monthly obligations
None
Quarterly obligations
None
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.

Other obligations

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
    • Each general partner of the fund, if the fund is a limited
  • Appointment, resignation or removal of a Director or officer.
Tax Obligations and Other Exemptions
Requirements Description
Business Tax
3% of Net Profit based on the audited report
Withholding Tax
No withholding tax is payable on dividends and/or interest payable.
Value Added Tax (VAT)
VAT is not applicable to mutual funds in its entirety.
Stamp duty Act
Mutual funds are exempt from payment of stamp duty Tax
Trades Tax Act
Mutual funds are exempted
Immovable Property Transfer Restriction Act
Mutual funds are exempted
Immigration Decree
Mutual funds are exempted
Exchange Control Act
The provisions of the Exchange Control Act do not apply to mutual funds.
Foreign Earnings Act
The Foreign Earnings Act is not applicable to mutual funds in its entirety.

Benefits of a Labuan Public Fund:

  • Flexible structure – in the form of Labuan Company, partnership, protected cell company, foundation or unit trust.
  • Support multiclass fund – multi currency / asset class.
  • Hassle free private fund set-up – no approval required, fund manager need not be licensed.
  • Simple tax structure.
  • ZERO withholding tax on payments to non-residents.
  • No stamp duty on all instruments relating to offshore business activities including share transfer.
  • No foreign exchange controls.
  • No capital gains tax / inheritance tax.
  • Strategically situated in the Asia Pacific region and sharing a common time zone with many large Asian cities.
  • Double Tax Agreements between Malaysia and over 70 countries.