In March 2016, 10 financial advisory firms in Singapore have been slapped with fines totalling nearly SGD1 million for anti-competitive behavior. The financial advisory firms collaborated to force a competitor, iFAST, to withdraw its offer to provide 50% commission rebate on life insurance products. The 10 firms have up to two months to appeal against the charge and penalties.
Under Singapore insurance law, currently, there is no specific prohibition on offering commission rebate (although there are rules relating to the offering of commissions payable to insurance broker solely based on volumes and sales).
However, the appropriateness of commission rebate has been a longstanding debate as it raises issue on whether consumers are inappropriately induced into purchasing insurance products. It would be interesting to see if MAS, the financial regulator, will issue any policy statements on the offer of commission rebates in light of the publicity from the actions taken by the Competition Commission of Singapore (CSS), which is a first of its kind in the financial services industry.