On 5 June 2014, the Monetary Authority of Singapore (the "MAS") issued a consultation paper on "Proposed Amendments to the Monetary Authority of Singapore Act and Trust Companies Act" (the "Consultation Paper"). The Consultation Paper contains proposals to amend the Monetary Authority of Singapore Act (the "MAS Act") and the Trust Companies Act (the "TCA") to enhance Singapore's supervisory cooperation regime with foreign regulators and to extend the regime for countering money laundering and terrorism financing (the "AML/CTF regime") to financial holding companies.
The consultation closes on 7 July 2014.
Changes to the MAS Act
The following changes to the MAS Act are proposed:
- The definition of "financial institutions" in the MAS Act will be extended to include designated financial holding companies so that they will be subject to the AML/CTF regime provided under the MAS Act. Designated financial holding companies are non-operating holding companies that hold as subsidiaries, banks or insurance companies in Singapore which will be regulated under the Financial Holding Companies Act when it comes into force.
- The need for "financial institutions" to perform customer due diligence ("CDD") and keep proper records will be set out in the MAS Act. The detailed CDD measures and record keeping requirements will continue to be reflected in the respective MAS AML/CFT Notices.
- The powers of the MAS to obtain and exchange supervisory information with foreign supervisors in respect of regulated financial institutions will be broadened to enhance the level of cooperation. The proposed changes will empower the MAS to share information, including information subject to banking secrecy rules, with:
- foreign counterpart authorities for AML/CFT supervisory purposes; and
- Singapore authorities for AML/CFT supervisory, investigation and law enforcement purposes;
subject to proposed safeguards to prevent "fishing expeditions" and other forms of abuse.
Changes to the TCA
The TCA currently only expressly allows the MAS to authorise on-site examinations by foreign supervisory authorities of licensed trust companies (the "LTCs") that are incorporated outside Singapore. It is proposed that the powers in the TCA be aligned with the existing powers under the Banking Act to facilitate the inspection of Singapore- incorporated LTCs that are subsidiaries of foreign financial groups by their foreign parent supervisory authorities.
The MAS will also review other legislation that it administers, such as the Financial Advisers Act and the Money-changing and Remittance Businesses Act, to consider if similar powers to authorise on-site examinations by home supervisory authorities would be relevant.
The following documents relating to the Consultation Paper are available from the MAS website www.mas.gov.sg, please click on the provided links for the full text of the documents.