Trend of Single Family Offices from Emerging Markets Setting Up in Singapore

Mr Yip Hon Weng asked the Prime Minister and Minister for Finance (a) whether there is a recent trend of single family offices (SFOs) from emerging markets, such as the Middle East and China, being set up in Singapore; (b) if so, whether an update can be provided on the trend; and (c) whether there are specific considerations in ensuring the transparency and legitimacy of funds from these SFOs.

Mr Gan Kim Yong (for the Prime Minister): While many of the Single Family Offices (SFOs) awarded tax incentives 1 are from emerging markets, their proportion among all SFOs awarded tax incentives has been relatively stable over the last few years.

All SFOs applying for the Monetary Authority of Singapore ( MAS) tax incentives are required to open accounts with financial institutions (FIs) in Singapore and are subject to the FIs’ due diligence checks. In addition, MAS screens the tax incentive applicants for adverse reports and money laundering or terrorism financing risks.

MAS issued a consultation paper in July last year proposing to require all SFOs incorporated in Singapore, regardless of whether they have applied for an MAS tax incentive, to establish and maintain business relations with an MAS-regulated FI. This would subject all of them to anti-money laundering and countering the financing of terrorism checks by the FIs. A response to this consultation paper will be published soon.

Note(s) to Question No(s) 5:

1 These are the tax incentive schemes for funds under sections 13O and 13U of the Income Tax Act.