MAS Seeks Amendments To Financial Market Laws

Source: The Business Times, October 12, 2007

Changes aim to enhance regulatory oversight, responsiveness to market innovation











LAWS relating to the financial market in Singapore will be amended, with regulators asking for comments on the proposed changes.

The Monetary Authority of Singapore (MAS) has released a policy consultation paper on proposed changes to the Securities and Futures Act (SFA) and the Financial Advisers Act (FAA).

This is the third in a series of policy consultations that the MAS is conducting following a review of the two pieces of legislation that started last year.

The proposed changes aim to enhance MAS’ supervisory oversight of capital markets services and holders of financial advisers’ licences and the responsiveness of the regulatory framework to market innovation.

One of the changes proposes to let the holders of licences for capital markets services (CMS) and financial advisers (FA) have perpetual licences so that they do not need to renew their permits every three years.

MAS is proposing to amend the law to require foreign regulators to obtain its permission to inspect CMS and FA licence holders.

Noting the increasing globalisation of capital markets, MAS said that it has been receiving more requests from foreign regulators to inspect licence holders whose parent entities they supervise.

The authority said that such inspections should be subject to safeguards including the requirement to protect confidentiality of information and reciprocity by foreign regulators to its requests.

MAS is also proposing to extend the power to issue a prohibition order to banks, insurance and finance companies which are at present exempt from licensing.

Currently MAS is empowered only to issue such orders against CMS licence holders.

Other changes also propose to amend the definitions of ’securities’ and ‘futures contract’ to let MAS prescribe new products as securities as well as exclude other products which may not be considered as financial instruments.

The consultation paper can be found on the MAS website. Comments should be sent by Nov 9.