Singapore VCC and Hong Kong OFC: fund vehicle comparison
Compare sub-fund segregation, tax exemptions, treaty eligibility and operating requirements in Singapore and Hong Kong.
The Singapore Variable Capital Company (VCC) and the Hong Kong Open-ended Fund Company (OFC) are the two onshore, corporate, open-ended fund vehicles that Asia's leading financial centres built to compete with Cayman. Both let a single entity hold segregated sub-funds, issue and redeem shares at net asset value, and reach effective zero tax on qualifying fund income. The choice usually comes down to three things: which treaty network your portfolio needs, which tax-exemption regime fits your structure (Singapore's 13O/13U vs Hong Kong's unified fund exemption), and which market and investor base you serve.
VCC vs OFC at a glance
| Feature | Singapore VCC | Hong Kong OFC |
|---|---|---|
| Regulator | MAS + ACRA | Securities and Futures Commission (SFC) |
| Year live | VCC Act in force 14 Jan 2020 | OFC regime from 2018 |
| Sub-fund segregation | Yes — Section 29 ring-fencing | Yes — statutory protected sub-funds |
| Tax exemption route | 13O / 13U (MAS-administered) | Unified fund exemption (profits tax) |
| Treaty network | 90+ DTAs | ~45 comprehensive DTAs |
| Must appoint licensed manager | Yes — MAS-licensed Permissible Fund Manager | Yes — SFC-licensed investment manager |
| Adoption to date | Faster — 1,406 VCCs at end-2025 | More gradual |
| Re-domiciliation in | Yes (inward transfer) | Yes (re-domiciliation mechanism) |
| Privacy | Register of members not public | Register access via SFC; not fully public |
Which has the better tax exemption?
Both can reach effective zero tax on qualifying fund income, but the routes differ. A Singapore VCC applies for Section 13O (S$5 million in designated investments at application on the non-SFO track, no annual re-test; S$20 million tested yearly on the SFO track; two professionals) or Section 13U (S$50 million on both tracks, three professionals), administered by MAS — see the 13O/13U/13D guide. A Hong Kong OFC instead relies on the unified fund exemption, which exempts qualifying transactions without an upfront MAS-style application. The VCC route is more structured and audited; the OFC route is more self-assessed. Managers who want a clear, documented incentive award often prefer the Singapore approach for LP comfort.
How do the treaty networks compare?
This is usually the tiebreaker for Asia-focused funds. Singapore's 90+ DTAs meaningfully outweigh Hong Kong's narrower comprehensive network for many target markets — particularly India, Indonesia and Vietnam, where Singapore treaty rates can cut withholding tax sharply. Hong Kong's edge is its proximity and connectivity to mainland China (including Stock and Bond Connect) and a strong China DTA. If your portfolio is China-centric, the OFC story is competitive; if it is pan-Asian or India/ASEAN-weighted, the VCC's treaty footprint typically wins. The full withholding matrix is in the treaty/DTA access comparison.
Adoption of the two fund vehicles
Singapore reported 1,406 VCCs at the end of 2025. The VCC operates alongside the 13O/13U incentive framework, established fund-service providers and an inward re-domiciliation process. Hong Kong’s OFC has developed under a different regulatory and market framework. Compare dated adoption figures with the portfolio and operating requirements; adoption alone does not determine the more suitable vehicle.
Singapore or Hong Kong for your fund?
Share your strategy and target markets to request an introduction to a Singapore fund-services provider for a vehicle and tax review.
Discuss your requirements →Family-office considerations
Singapore's combination of the VCC, the 13O/13U regime and its family-office ecosystem has made it the default for single and multi-family offices in the region. The OFC is primarily a fund-manager vehicle and is less commonly used as a family-office wrapper. If your end goal is a family-office or private-equity structure with treaty access, the VCC is usually the more complete answer.
Frequently asked questions
What is the difference between a Singapore VCC and a Hong Kong OFC?
Both are onshore, corporate, open-ended fund vehicles with sub-fund segregation, created to compete with Cayman. The VCC sits under MAS/ACRA with access to Singapore's 90+ tax treaties and the 13O/13U exemptions; the OFC sits under Hong Kong's SFC with access to Hong Kong's smaller treaty network and its unified fund exemption.
Which is more popular, the VCC or the OFC?
Singapore reported 1,406 VCCs at the end of 2025. The OFC has developed more gradually and serves Hong Kong’s investment-management market, including strategies connected with mainland China. Adoption is one consideration alongside the investor base, regulatory requirements and portfolio.
Does a Hong Kong OFC offer tax exemption?
Yes. A qualifying OFC can claim Hong Kong's unified fund exemption on qualifying transactions. A Singapore VCC uses the 13O or 13U exemption administered by MAS. Both can reach effective zero tax on qualifying fund income when conditions are met.
Can you re-domicile a fund to a VCC or an OFC?
Both jurisdictions allow inward re-domiciliation of foreign corporate funds. Singapore's VCC inward re-domiciliation and Hong Kong's OFC re-domiciliation mechanism both let an existing Cayman or BVI fund continue onshore without winding up.
VCC Singapore is an independent informational resource and is not a regulator, law firm or tax adviser. Tax thresholds, treaty rates and conditions are set by MAS/IRAS and foreign authorities and change periodically — confirm the current figures before acting. This page is general information, not legal, tax or financial advice.