On 17 February 2014, the Accounting and Corporate Regulatory Authority (Amendment) Bill 2014 (the “Bill”) was introduced in Parliament following a month-long public consultation exercise in November 2013 on a draft version of the Bill which was jointly conducted by the Ministry of Finance (the “MOF”) and the Accounting and Corporate Regulatory Authority (the “ACRA”). The MOF and the ACRA issued their response to the feedback from the public consultation on 10 February 2014.

The Bill will enhance the regulatory framework for corporate service providers (“CSPs”). This is a timely development in light of the inaugural National Money Laundering and Terrorist Financing Risk Assessment Report issued in January 2014 by the Steering Committee for Combating Money Laundering and Terrorist Financing which identified the CSP industry as having some risks.

Essentially, the Bill will amend the ACRA Act to regulate filing agents (i.e. persons who in the course of business carry out on behalf of other persons transactions with the respective Registrars under the Acts administered by the ACRA) and qualified individuals (i.e. individuals whose role is to carry out or supervise the carrying out of transactions with the relevant Registrar), in respect of among other things, compliance with the recommendations of the Financial Action Task Force relating to CSPs.

There will be new sections setting out the framework for a person to register and renew his registration as a filing agent or a qualified individual. An applicant might be refused registration or renewal of registration if the applicant has been convicted of an offence involving fraud or dishonesty punishable with imprisonment of three months or more, or if the applicant is an undischarged bankrupt. There is also a requirement to complete certain prescribed courses and training. There will be certain prescribed terms and conditions of registration, including the duty to undertake customer due diligence for registered filing agents. A breach of the terms and conditions of registration might result in the cancellation or suspension of the registration, imposition of certain restrictions, censure and financial penalties.

The new regulatory framework for CSPs is expected to be implemented by end 2014.

Reference materials

The Bill is available from the Singapore Parliament website www.parliament.gov.sg by clicking here.

The following materials are available from the MOF website www.mof.gov.sg