The Financial Institutions (Miscellaneous Amendments) Bill 2024 (“Bill“) was passed on 7 March 2024 to enhance and streamline the Monetary Authority of Singapore (“MAS“)’s investigative, reprimand, supervisory and inspection powers across various MAS-administered Acts governing the financial industry.
Key changes effected in the Bill include:
(a) Extending the scope of change-of-control approval requirements. Prior to the Bill, the requirement for persons to obtain MAS’ approval before acquiring control of capital markets financial institutions (“FIs“) which was generally applicable did not extend to locally incorporated recognised market operators, recognised clearing houses, and approved trustees. The Bill now introduces the approval requirements for these entities as well;
(b) Clarifying that on the timeline for the change-of-control approval requirement, MAS’ approval of the potential acquirer would only be required to be obtained before the potential acquirer obtains control of the regulated entity. Prior to the Bill, approval was technically required before entering into the arrangement by which control might be obtained (e.g. before signing the sale and purchase agreement or other documents during the early stage of the negotiations), which MAS has clarified was not its intent;
(c) Enhancing MAS’ investigative powers to include giving MAS the power to: (i) require individuals to attend interviews and record written statements providing information; (ii) enter premises without a warrant where it has reasonable grounds to suspect that the premises are, or have been, used by a person being investigated by MAS; (iii) obtain a court warrant to seize evidence, including electronic evidence, from premises (a) when a person has failed to comply with an order to produce such evidence; or (b) if there is a risk that evidence will be destroyed or tampered with if an order for the production of such evidence is made; and (iv) transfer evidence to the Police or the Public Prosecutor and vice versa to facilitate greater inter-agency coordination in criminal investigations and regulatory actions;
(d) Clarifying the applicability of MAS’ reprimand powers even if a person has left an FI or the financial industry;
(e) Empowering MAS to issue directions to regulated FIs conducting unregulated activities such as offering products that are not regulated by MAS (e.g. bitcoin futures and other payment token derivatives traded on overseas exchanges). The Bill will enable MAS to issue written directions on the minimum standards and safeguards that should be in place when regulated FIs conduct unregulated businesses; and
(f) Enhancing MAS’ supervisory and inspection powers under the Securities and Futures Act 2001 (SFA), Financial Advisers Act 2001 (FAA) and Trust Companies Act 2005 (TCA), for MAS to ensure that it has consistent powers across these Acts and to align with the Banking Act 1970 (“BA“). MAS stated it would defer amendments to the BA for now, and further consider the impact of the amendments on existing provisions unique to the BA, for instance those concerning the special investigation of banks, investigation of merchant banks and investigation of credit card and charge card licensees.
