The VCC has gained significant traction as a flexible and tax-efficient fund vehicle, supporting a wide range of fund structures. However, as adoption grows, there is an increasing need to consider how these vehicles behave in downside scenarios, particularly in restructuring and insolvency contexts.
The article explores how the VCC framework interacts with Singapore’s existing insolvency regime, including key issues such as:
The application of corporate insolvency principles to VCC sub-funds and umbrella structures
Practical challenges in creditor recourse and asset segregation
The treatment of stakeholders in distressed fund scenarios
Cross-border considerations, given the international nature of fund structures
A key theme is that while the VCC regime offers structural flexibility during the growth phase, its practical operation under financial stress continues to evolve alongside case law and market practice.
Given the continued growth of fund vehicles across many jurisdictions, these considerations are becoming increasingly relevant, not only in Singapore but also in cross-border engagements involving fund structures.
For those interested, the article can be accessed at the link below.
Future-Proofing Fund Vehicles: The Road to VCC-IRDA Alignment in Singapore
We hope this provides some useful context and would welcome any discussions or perspectives on how similar issues are being approached in practice.
Please do not hesitate to contact Marie Lee (marie.lee@bakertilly.sg) should you require further clarification.
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