Approved Manager FAQs · 1/7

An Approved Manager is an entity approved by the FSC to provide investment management or investment advisory services to qualifying funds and related structures within the statutory scope; it is not an unrestricted financial licence. The applicant must be a BVI company or a limited partnership registered in the BVI. An individual cannot obtain this approval in their personal capacity.

Risk warning:An ordinary client account or an overseas structure may not necessarily be within the scope of clients that can be served.

The main features are restrictions on the business and persons served, size caps, and ongoing regulatory obligations, rather than a full investment-business licence. The combined AUM cap for private and professional funds is 4 billion US dollars; for closed-ended funds, the cap based on committed capital is 10 billion US dollars. Governance, an authorized representative, financial reporting, and applicable AML/CFT arrangements must also be maintained.

Risk warning:Promoting this approval as authorization for payment services, banking or insurance would mislead clients.

This is not a separate provisional operating licence, but a limited operating mechanism while an application is pending. A complete application should in principle be submitted at least 7 days before the proposed commencement of business. Once the conditions are met, the operating window lasts no more than 30 days from the date of submission, and the FSC may extend it by up to a further 30 days. If the application is refused or the period expires without approval or a valid extension, the relevant business must cease.

Risk warning:Submitting an application does not mean it will ultimately be approved or that business may be conducted indefinitely.

Prepare a complete Approved Manager application rather than a separate pilot-operation plan. Core materials include the application form; entity registration and signing-authority details; information on directors or general partners and key personnel; the proposed funds to be served and their scale; management or advisory arrangements; the proposed commencement date; and the application fee. Check the current form for the specific supporting documents.

Risk warning:Incomplete information may affect the processing of the application and the applicability of the interim operating mechanism.

The Approved Manager scale limits are prescribed by specific regulations and are not discretionary negotiated limits. Combined AUM for private and professional funds must not exceed 4 US dollars, while aggregate committed capital for closed-ended funds must not exceed 10 US dollars; the two measures are calculated separately. Capital-resource requirements for a standard SIBA licence are determined case by case according to business risk.

Risk warning:Mistaking a cap for minimum registered capital may lead to errors in applications and monitoring.

It is prudent to monitor in advance and plan a licence upgrade when approaching the limit; this is a practical management recommendation. Once the relevant limit is actually exceeded, the FSC must be notified in writing within 7 days. In principle, within 3 months the firm must return within the threshold, apply for a standard SIBA licence, or obtain the FSC’s written approval to continue operating. Adding staff does not replace these steps.

Risk warning:Failure to notify or take action promptly after exceeding the limit may result in losing the basis for qualifying to operate.

Approved Manager is a limited approval pathway for qualifying fund management or advisory services, subject to restrictions on the persons served and scale. “Full licence” usually refers to a standard SIBA investment business licence, which covers only the categories or subcategories stated in it. Capital, organisational and compliance requirements are assessed based on the actual business; the licence does not automatically authorise all financial services.

Risk warning:Assuming that a standard licence covers all business activities may result in operating beyond the scope of authorisation.

Consider a standard SIBA licence if the business intends to serve non-qualifying persons, conduct investment business outside the scope of the Regulations, or exceed the size cap; the FSC may also require a transition for reasons of public interest. After exceeding a limit, the statutory notification and handling window must be followed. New payment, insurance or banking business requires separate assessment of independent licences; it is not simply an upgrade of an investment licence.

Risk warning:Expanding the business before applying to convert the licence may result in unauthorised operations.

“39 jurisdictions” should not be retained as a current fixed number. Recognised jurisdictions under the Approved Manager framework are relevant to equivalence and client-eligibility assessments for certain foreign funds or investors; they are not a general list of compliance exemptions. The specific jurisdictions, purposes of application and conditions must be checked against the latest relevant documents.

Risk warning:Reusing an outdated list or figure may result in an incorrect determination that a client is eligible for services.

Recognised jurisdictions may be relevant to equivalence assessments for the eligibility of certain foreign funds or investors, but due diligence should not be reduced automatically based solely on the place of origin. In practice, the entity’s identity, regulatory status, controllers and business risks should still be verified. Whether a particular simplified measure may be used must be confirmed case by case according to the actual activity and latest applicable AML/CFT documents.

Risk warning:Treating a recognized jurisdiction as a due-diligence exemption label may result in high-risk clients being overlooked.

An Approved Manager must continuously comply with its business and size limits. A company-form entity must maintain at least two directors, one of whom is a natural person, and a certified authorized representative. It must submit an annual return to the FSC by 31 1 each year, and financial statements are generally due within 6 months after the financial year-end. Renewal fees and applicable AML/CFT obligations must also be addressed; this should not be described categorically as a mandatory annual audit.

Risk warning:Confusing annual company financial filings with FSC returns may result in regulatory filings being missed.

Changes to an Approved Manager’s application information must be notified to the FSC in writing within 14 days with the prescribed statement; matters with significant regulatory impact must also be notified. This does not mean that all changes may be reported only after the fact. Transfers, changes of control or termination of approval must be checked against the specific matter and the latest documents, and arrangements made for clients, records and outstanding filings.

Risk warning:Transferring an approval without authorization or making a change before verification may breach regulatory requirements.

The manager should first establish who receives, controls and holds client money or assets; management status must not be treated as custody authorisation. Agreements should specify custody of assets, instruction authority, reconciliation and handling of exceptions. Confirm specific segregation, record-keeping and audit obligations against the actual role and the latest applicable documents.

Risk warning:Actually controlling customer assets without identifying the corresponding licensing requirements may lead to non-compliance.

The FSC has supervisory, information-request and enforcement powers over regulated entities. In relation to an Approved Manager, the FSC may, as permitted by law, require an application for a standard SIBA licence or require some or all of the relevant business to cease. Other sanctions and procedures must be checked against the specific facts of the breach and the latest applicable documents.

Risk warning:Failure to heed an FSC direction to cease business may aggravate regulatory consequences.

An Approved Manager is an entity approved by the FSC to provide investment management or investment advisory services to eligible funds and related structures within the statutory scope. The applicant must be a BVI company or a limited partnership registered in the BVI. An individual cannot obtain approval directly, nor does the approval authorise the conduct of all financial business.

Risk warning:Providing services to ineligible clients may exceed the scope of approval.

The main features of an Approved Manager are limits on the clients served and scope of business, an applicable size cap, and ongoing FSC supervision. A corporate manager must maintain at least two directors at all times, at least one of whom must be a natural person, and maintain an FSC-approved authorized representative. It must also implement applicable AML/CFT and regulatory reporting arrangements.

Risk warning:A disruption in arrangements for key personnel or an authorised representative may affect continued eligibility.

This is not a general trial-operation regime for validating a business model. A complete application should in principle be submitted at least 7 days before the proposed commencement of business. Eligible applicants may conduct the relevant business from the date of submission for up to 30 days, and the FSC may extend this by up to a further 30 days. This period is not approval; if the application is refused, the business must stop immediately.

Risk warning:Continuing to operate after the temporary window expires without appropriate authorisation may constitute a violation.

The combined AUM cap for private and professional funds is 4 US dollars, calculated by reference to net asset value; for closed-ended funds, the cap is 10 US dollars based on aggregate investor capital commitments. The two caps are monitored separately. If a cap is exceeded, the FSC must be notified within 7 days, and the fund must restore eligibility or address arrangements such as conversion of licence within the prescribed three-month window.

Risk warning:Using paid-up capital instead of closed-ended committed capital may lead to an underestimate of the regulatory scale.

An Approved Manager is an approval pathway limited by the clients, activities and scale of services; it is not a standard investment business licence. A standard SIBA licence authorises specific categories or subcategories and does not permit all investment business once obtained. Capital resources and compliance requirements must be determined in light of business risks and licence conditions.

Risk warning:Treating a standard licence as unlimited authorization may lead to operations beyond its scope.

The recognised-jurisdiction rules may be relevant to qualification and equivalence assessments when an Approved Manager serves foreign funds, but they do not imply a general compliance exemption. “39 jurisdictions” should not be treated as a fixed current count; each case must be confirmed against the proposed service structure, investment relationship and latest applicable list.

Risk warning:Treating a fund as eligible solely on the basis of its place of registration may result in the service recipient not meeting the relevant conditions.

Ongoing requirements include maintaining qualified personnel, adequate resources, governance and AML/CFT controls, and fulfilling applicable reporting and change-notification obligations. An Approved Manager must submit its regulatory annual return to the FSC by 1 month 31 day each year. Financial statements are generally due within six months after the financial year-end and must not be conflated with company financial filings.

Risk warning:Confusing different types of annual return may result in late regulatory filings.

A corporate Approved Manager must comply with both BVI company law and the Approved Manager regime: company registration, governance and register filings do not replace FSC approval or ongoing obligations. A BVI-registered limited partnership may also apply, but must meet the requirements for its own legal form; the company rules cannot simply be applied wholesale.

Risk warning:Inconsistencies between entity information and regulatory applications may affect ongoing compliance.

Fitness and propriety assessments for responsible persons focus on integrity, competence, experience, reputation, and financial soundness, not merely the absence of a criminal record. Prepare materials based on the actual role, including a résumé, qualifications, regulatory background disclosures, and proposed arrangements for carrying out the duties; directors, compliance functions, and authorized representatives are not interchangeable merely by virtue of their titles.

Risk warning:A mismatch between key personnel’s experience and their actual responsibilities may affect the application assessment.

Capital planning should take account of actual business risks, operating expenses and ongoing financial soundness; an unverified uniform minimum amount should not be applied. The aggregate US$4 billion limit for private/professional funds and the US$10 billion limit for closed-ended funds are applicable size caps, not applicants’ minimum capital. Specific financial conditions must be verified case by case against the latest applicable documents.

Risk warning:Treating the cap on assets under management as a capital requirement will distort financial planning.

The application should state who will carry out day-to-day investment activities under any outsourcing or delegation arrangement, and the actual arrangements should remain consistent with the application. Conduct due diligence on the service provider and specify authority, access to records and ongoing oversight in the contract. Outsourcing does not transfer the board’s compliance responsibilities; changes with significant regulatory implications must also be notified to the FSC.

Risk warning:If business records cannot be obtained after outsourcing, regulatory supervision may be ineffective.

An Approved Manager must submit its regulatory annual return to the FSC by 1 31 each year. Financial statements are generally due within 6 months after the financial year-end, and applicable change and significant-matter notification obligations must also be met. Exemptions from specific compliance-officer or manual requirements do not remove AML/CFT obligations; AML returns must also be filed as applicable.

Risk warning:Mistaking a specific exemption for a blanket exemption from anti-money laundering obligations.

Official Approved Manager fees comprise an application fee of 1,200 US dollars, an approval fee of 1,800 US dollars and an annual renewal fee of 1,800 US dollars; each is triggered at a different point. Government company fees, registered agent, authorised representative and professional adviser costs are additional. The application fee should not be treated as the total cost; check the current fee schedule before payment.

Risk warning:Omitting approved fees or ongoing maintenance costs may result in an inadequate budget.

Directors should oversee the scope of authorized business, financial soundness, risk controls and the effective operation of compliance systems; appointing a responsible person or outsourcing cannot transfer ultimate compliance responsibility. A corporate manager must continuously have at least two directors, one of whom is a natural person, and maintain an FSC-certified authorized representative. The responsibilities of each role should be clearly distinguished.

Risk warning:Unclear responsibilities may result in no one handling significant compliance matters.

If planning to cease business or surrender an Approved Manager approval, first confirm the applicable process with the FSC and explain arrangements for client and fund transfers, outstanding matters, record retention and remaining filings. Liquidation, public disclosure or a particular fixed process should not be treated as a universal requirement in every case; specific notification, approval and wind-down obligations must be verified individually.

Risk warning:Failing to discharge outstanding regulatory filing obligations after ceasing operations.

Preparation for an inspection should focus on demonstrating that governance, compliance and AML/CFT controls are operating, and that board records, client/fund materials, business records, financial statements and outsourcing oversight evidence can be retrieved. Also check client eligibility and any scale limits. Do not claim that all managers undergo on-site inspections or audits at fixed intervals.

Risk warning:Policies that exist only as written documents without evidence of implementation may lead to remediation requirements.

A complete application must in principle be submitted at least 7 days before the proposed opening date, unless the FSC agrees in writing to a shorter period; this is not a guarantee of approval within 7 days. An eligible applicant may conduct the relevant business during a window of up to 30 days from submission, and the FSC may grant a further extension of up to 30 days. Incomplete materials, personnel fitness and unclear business scope may all affect review.

Risk warning:Treating the advance application period as the approval period may result in opening in breach of requirements.

For a change in control or a material structural change, first determine whether it changes the application information, affects business eligibility or has a material regulatory impact. Changes to application information must be notified to the FSC in writing within 14 days, together with the prescribed declaration; matters with a material regulatory impact must also be notified. Whether prior approval is additionally required should be verified for the particular transaction and against the latest applicable materials; an after-the-event notice cannot simply be treated as a substitute.

Risk warning:Completing a transaction without identifying prior-approval requirements may breach applicable conditions.

The applicant may be a BVI Business Company or a limited partnership registered in the BVI; an individual cannot obtain approval in their personal capacity. The main differences between a BC and an LP concern governance, signing authority and liability arrangements. The director-number requirement applies to company applicants; an LP should prepare documents appropriate to its partnership and management structure and should not simply apply company governance requirements.

Risk warning:Governance documents that do not match the actual management structure may affect the application.

A corporate Approved Manager must have at least two directors at all times, at least one of whom must be a natural person; one director alone is not sufficient. Directors should also have integrity, competence and experience appropriate to their roles, and fitness materials should be prepared. Governance arrangements for a limited partnership applicant must be checked separately against its actual structure.

Risk warning:After a director’s departure, an insufficient number of directors may mean that the entity no longer meets ongoing requirements.

A corporate Approved Manager may use a corporate director where permitted by the applicable rules, but must maintain at least two directors at all times, one of whom must be a natural person. A contact person designated by the corporate director cannot substitute for the natural-person director requirement. The corporate director’s authority, control chain and actual performance of duties should also be clearly documented.

Risk warning:Miscounting the contact person for a corporate director as a natural-person director may result in non-compliance with the director-number requirement.

An individual director should prepare identity, career history, professional qualifications, experience and integrity/regulatory background information to support a fitness assessment; no particular certificate or uniform update frequency should be treated as invariably required. Changes to application information must be notified to the FSC in writing within 14 days as required, and ongoing fitness to serve and material regulatory matters should also be monitored.

Risk warning:Changes to directors’ background or appointment information that are not reported may result in inaccurate records.

An MLRO arrangement is not automatically waived merely because an Approved Manager benefits from a specific compliance exemption; it should be implemented in accordance with the applicable AML/CFT framework and business risks. The MLRO should be able to receive, investigate and escalate internal suspicious activity reports and have genuine authority and resources. Specific appointment, dual-hatting and qualification requirements must be verified; no uniform certification or experience threshold should be invented.

Risk warning:A merely nominal appointment of an MLRO may prevent suspicious activity from being reported effectively.

The Approved Managers Regulations provide exemptions from specific compliance officer and compliance manual requirements, so the appointment rules for a standard SIBA licensee cannot be applied directly. The exemption does not mean that compliance controls are unnecessary. In practice, clarify who is responsible for implementing policies, training, regulatory reporting and remediation, and verify any other applicable requirements against the actual activities.

Risk warning:Misunderstanding an exemption for a role as meaning that no compliance management is required may result in ongoing violations.

A BVI company must continuously appoint a licensed registered agent and maintain a registered office in the BVI. The agent is responsible for company registration and the relevant due-diligence interface. An Approved Manager must also at all times have an FSC-certified authorised representative, who performs statutory functions such as regulatory liaison. The registered agent does not automatically become the authorised representative or assume all application and compliance responsibilities.

Risk warning:Appointing only a registered agent while omitting an authorised representative may fail to meet approval requirements.

Information on funds proposed to be managed should specify the fund category, place of establishment, investor restrictions, investment relationship, strategy, size and the scope of management/advisory services, so that eligibility as a qualifying service recipient can be assessed. The aggregate AUM cap for related open-ended funds is 4 billion US dollars, and the aggregate committed capital cap for closed-ended funds is 10 billion US dollars; these must be monitored using separate metrics.

Risk warning:Accepting business solely because the name contains “fund” may exceed the scope of permitted services.

Fit & Proper assessments primarily consider integrity, reputation, professional competence, experience and financial soundness, in light of the proposed role and actual business. A criminal record check or professional certificate cannot on its own establish fitness and propriety. Relevant regulatory, litigation or integrity history should be disclosed truthfully; the absence of any disciplinary record should not be presented as a uniform absolute condition.

Risk warning:Concealing regulatory or integrity-related background may undermine the fit-and-proper assessment.

Whether a criminal record certificate must be submitted must be confirmed against the latest application documents and FSC case-specific requirements; it cannot be assumed that every responsible person must provide one. Key personnel must truthfully disclose integrity, regulatory and litigation history; a single criminal record certificate does not replace a complete fit-and-proper assessment.

Risk warning:Omitting significant background matters may affect the fit-and-proper assessment.

Professional qualifications relevant to the proposed responsibilities may support evidence of competence, but there is no list of certificates that directly guarantees compliance with regulatory requirements. Competence should be demonstrated through a combination of experience, actual responsibilities, investment management experience and integrity information; qualification titles do not replace the FSC’s fit-and-proper assessment.

Risk warning:Relying solely on professional certificates in an application may not demonstrate the ability to perform the role in practice.

Industry experience cannot be assessed as sufficient by applying a uniform number of years. Explain relevant experience in the proposed investment management or advisory business, decision-making and oversight responsibilities, risk management capabilities, and time commitment. Fitness should be assessed case by case in light of business complexity and the latest applicable materials.

Risk warning:A mismatch between experience and the proposed business may prompt further inquiries.

If a reference letter is required, it is advisable to obtain one from a former employer or professional who knows the relevant person’s work performance and integrity, and to retain contact details that can be verified. This is a practical recommendation, not a prescribed list of referees. Whether letterhead, a signature or a particular format is required must be confirmed against the latest application requirements.

Risk warning:If a referee's statements cannot be verified, the credibility of the materials may be weakened.

Proof of address options for practical preparation may include a bank statement, utility bill, or government letter showing the individual's name and address. Acceptance of a document, its validity period, and certification requirements depend on the applicable application requirements and the agent's risk policy; there is no uniform requirement limiting such documents to the most recent three months.

Risk warning:Inconsistent or non-compliant document information may lead to a request for additional documents.

The application arrangements should clearly identify advisers or service providers performing important functions, their responsibilities and the oversight relationship; the scope of specific disclosures should be checked against the latest forms. A fund custodian must not be treated as a role that every manager is required to appoint. An Approved Manager is not required to appoint an auditor, but remains subject to financial-statement obligations.

Risk warning:Unclear outsourcing boundaries may create gaps in oversight responsibilities.

Personal tax or financial records are not documents that can be listed as universally mandatory; they should be determined based on key-person assessments and the FSC’s actual requirements. Financial soundness, source of funds and relevant conflicts of interest may be prepared and explained, and facts that could affect the assessment should be disclosed truthfully. A natural person cannot apply for Approved Manager approval in their personal capacity.

Risk warning:An unclear explanation of the source of funds may affect the background assessment.

A foreign director should prepare identity, address, résumé, and fit-and-proper support materials, but it cannot be uniformly required that all documents be notarized and consularly legalized. The certification method, translations, and background evidence should be confirmed against the latest application materials and receiving requirements, with the English name consistent with other registration documents.

Risk warning:Using an unacceptable form of certification may increase the cost of repeating the process.

Whether part-time compliance or AML personnel are acceptable must be assessed in light of their responsibilities, business risks and applicable rules; it cannot be assumed unconditionally that they are permitted. The arrangement should demonstrate that the personnel have sufficient time, competence, independence and resources. A specific compliance exemption for an Approved Manager does not automatically remove AML/CFT obligations or the need for an MLRO arrangement.

Risk warning:Insufficient staffing may prevent suspicious activities from being escalated promptly.