A fund in the Gelephu Mindfulness City is regulated at three points at once: the vehicle, the manager and the offer, and each has its own rules. Basnet Law Pte. Ltd. advises sponsors and managers on establishing funds in GMC under the Financial Services Act 2025, the Fund Rulebook and the Limited Partnerships Act 2026, with the tax position under the Income Tax Act 2025 planned alongside. This page sets out what the law requires of a GMC fund and how we take a sponsor from structure to offering documents.
How we help
- Determining whether your structure is a Collective Investment Fund under the Financial Services Act 2025, and whether it is a Public Fund, an Exempt Fund or a Qualified Investor Fund.
- Licensing the manager for Managing a Collective Investment Fund and, where relevant, for Managing Assets.
- Appointing administrators and trustees of investment trusts, and drafting the trust deed.
- Registering Public Funds, and giving the 14-day notification before an Exempt Fund or Qualified Investor Fund is first offered.
- Structuring limited partnership vehicles under the Limited Partnerships Act 2026.
- Advising on the tax position under the Income Tax Act 2025, including the fund exemptions in sections 13O, 13OA and 13U.
How GMC fund law works, in plain terms
A Collective Investment Fund is "any arrangements with respect to property of any description, including money" whose purpose or effect is to let participants share in the profits or income from that property. Participants must not have day-to-day control, and contributions and profits must be pooled and the property managed as a whole by or on behalf of the Fund Manager.
Managing a fund is a specified activity under the Financial Services Act 2025. A person manages a fund when it is "legally accountable to the Unitholders" for the property or "establishes, manages or otherwise operates or winds up" the fund. Administration, and acting as trustee of an investment trust, are separately regulated. Under the GEN Rulebook 2026, a Venture Capital Fund manager need not appoint a Finance Officer.
Every Domestic Fund that is a Public Fund must be registered with the Regulator, on application by the Fund Manager or, for an investment trust, jointly with the Trustee. The manager of an Exempt Fund or Qualified Investor Fund must notify the Regulator at least 14 days before the initial offer of units. The detailed requirements sit in the Fund Rulebook published by the Gelephu Financial Services Office.
For the vehicle, the Limited Partnerships Act 2026 provides for general partners with unlimited liability and limited partners whose liability is capped at their agreed contribution. A limited partner who takes part in management becomes liable as a general partner, subject to the safe harbours in the Act's First Schedule.
On tax, the Income Tax Act 2025 treats a reference to a partnership as including a limited partnership. The fund exemptions in sections 13O, 13OA and 13U exempt the income of approved funds and the partners of approved limited partnerships managed by a GMC fund manager.
Who this is for
- Asset managers launching a first GMC fund or relocating an existing strategy.
- Venture capital and private equity sponsors structuring closed-ended vehicles.
- Family offices setting up private investment funds.
- Administrators and trustees seeking a GMC permission.
How an engagement runs
- Structure design. Fund type, vehicle, manager location and investor classes under the Act and the Fund Rulebook.
- Manager licensing. The Financial Services Licence application for fund management and the Approved Persons the GEN Rulebook requires.
- Vehicle formation. Limited partnership registration under the Limited Partnerships Act 2026, or company formation under the Companies Act 2025.
- Registration or notification. Public Fund registration, or the 14-day notification for an Exempt or Qualified Investor Fund, until the Regulator has what it needs.
- Offering documents. Constitution, offering memorandum and financial promotion compliance, ready to put in front of investors.
Frequently asked questions
Do I need a licence to manage a fund in GMC?
Yes, if you manage a Collective Investment Fund by way of business in GMC. Managing a Collective Investment Fund is a specified activity caught by the General Prohibition in the Financial Services Act 2025. We scope the permission before you approach GFSO.
Can a limited partner sit on an advisory committee without losing limited liability?
The First Schedule to the Limited Partnerships Act 2026 lists activities that do not amount to taking part in management, including consulting and advising and attending meetings. Anything beyond those safe harbours risks general-partner liability, so we draft the committee's terms of reference inside them.
Must a private fund be registered with GFSO?
Only Public Funds must be registered. Exempt Funds and Qualified Investor Funds are subject to the notification requirement, at least 14 days before the initial offer. We prepare and file the notification.
What is the tax position of a GMC fund?
Partnership rules apply to limited partnerships. The fund-specific exemptions in sections 13O, 13OA and 13U apply to approved funds, and we plan the structure around the approval conditions from the outset.
Talk to GMC counsel on the ground
Basnet Law Pte. Ltd. is the first law firm incorporated in the Gelephu Mindfulness City. A short conversation early in a matter usually saves time and cost later. Write to basnet@basnetgmc.com or office@basnetgmc.com with a few lines about your plans, and we will tell you plainly what is needed, how long it takes, and whether we are the right fit.
You may contact Basnet Law at basnet@basnetgmc.com or office@basnetgmc.com for any legal queries related to GMC.
