Public Funds

Public funds are mutual funds other than private funds and Islamic public funds are public funds that are in compliance with Shariah principles.

Registration Requirements

No public fund shall carry on business in or from within Labuan unless it has been registered under paragraph 33(1)(a) of Labuan Financial Services and Securities Act 2010 or in the case of Islamic public fund paragraph 38(1)(a) of Labuan Islamic Financial and Services Securities Act 2010. The annual fee payable is RM2,000 / USD600.

The applicant is also required to submit to Labuan FSA the following:

• a copy of the memorandum and articles of association/trust deeds/partnership agreement of the fund; 
• audited annual accounts of the promoter, where applicable, for the three years immediately preceding the application;
• a signed declaration by the directors/general partners of the applicant fund on confidentiality and secrecy; 
• in the event that its proposed minimum paid up capital exceeds RM1 million, if the minimum level of subscription required failed to be received within the stipulated time, all subscriptions shall be repaid immediately;
• a copy of the draft prospectus incorporating details as required under the Guidelines on Mutual Funds in Labuan;
• names, addresses and relevant experience of the directors/ general partners/trustees of the fund. The person in control or director or Chief Executive Officer (CEO) of the applicant fund must be a fit and proper person. The appointment of the Board of Directors and CEO requires prior approval from Labuan FSA; and
• Any other relevant information to the application.

Operational Requirements for Public Fund

The applicant fund:

• Must appoint a fund manager, trustee, administrator and custodian who are approved by Labuan FSA. In the case of Islamic public fund, a qualified Shariah Adviser to ensure compliance with Shariah principles.
• Must maintain a registered office in Labuan. For a Labuan fund permitted to be managed by a fund manager from a recognised country or jurisdiction, at least one of the fund-related businesses, such as custodian, trustee or fund administration, must be based in Labuan.
• Which has been granted provisional acceptance is not allowed to accept subscription monies or make investments until granted registration. It is allowed to use the provisional acceptance only for promotional or marketing purposes.
• Shall conduct business only in a foreign currency and not in Malaysian Ringgit except solely for the purpose of defraying administrative and statutory expenses.
• Shall appoint an approved auditor.
• Must notify Labuan FSA of any amendments or alteration to any of its constituent documents.
• Must conduct its business with due diligence and sound principles, maintain adequate and proper records and books of accounts and comply with the local laws and regulations where it services its clients.
• Must indicate clearly its name and licence number on its letterhead, stationery and other documents.
• Must comply with the requirements with regard to its accounts and the auditing.
• Must obtain the approval of Labuan FSA for any changes in its business plan.

Fees

All licensees are required to pay to Labuan FSA annual licence fees on or before 15 January of each year. If any of the mutual funds uses a PCC structure, the annual fee would be as follows: 

Governing Legislation

Labuan Financial Services and Securities Act 2010
Labuan Companies Act 1990
Labuan Business Activity Tax Act 1990
Labuan Limited Partnerships and Labuan Limited Liability Partnerships Act 2010
Labuan Foundations Act 2010