Bill Passed in Parliament to Enhance AML/CFT Requirements for Real Estate Industry

The Anti-Money Laundering and Other Matters (Estate Agents and Developers) Bill (“Bill“) was introduced for First Reading in Parliament on 7 March 2025, and was introduced for Second Reading and passed on 8 April 2025. The Bill will:

1. amend the: (i) Estate Agents Act 2010 (“EAA“); (ii) Housing Developers (Control and Licensing) Act 1965 (“HDA“); and (iii) Sale of Commercial Properties Act 1979 (“SCPA“); and

2. serve three purposes: (i) to strengthen current penalty frameworks; (ii) to give effect to, and align with, the Financial Action Task Force’s (“FATF’s“) recommendations; and (iii) to clarify restrictions against convicted persons.

The key amendments are summarised below.

Strengthening Current Penalty Frameworks 

1. Prescribe financial penalties on “per contravention” (instead of “per case”) basis: The EAA will be amended to provide that, in the case of a contravention of: (i) Part 4A of the EAA on prevention of money laundering (“ML“), proliferation financing (“PF“) or terrorism financing (“TF“); or (ii) any regulation or provision of a code of practice, ethics and conduct made under the EAA in respect of requirements relating to detecting and preventing ML, PF or TF, or to reporting of transactions suspected of involving the same:

• • The Council for Estate Agencies (“CEA“) may impose financial penalties on a “per contravention” basis in respect of a complaint or information referred to it regarding the conduct of a licensed estate agent (“LEA“) or registered salesperson (“RSP“) (instead of on a “per case” basis, as is currently the case).
  • A Disciplinary Committee may impose financial penalties on a “per contravention” basis in a disciplinary action against an LEA or RSP (instead of on a “per case” basis, as is currently the case).
  • The maximum penalties for other disciplinary breaches will remain on a “per case” basis.

These amendments ensure that the relevant penalty frameworks are updated to remain sufficiently deterrent, especially when viewed against the quantum of potential financial gains that may be made from facilitating illicit transactions. 

2. Increase maximum composition sums for housing developers and introduce composition framework for commercial and industrial developers: 

• • The HDA will be amended to increase the maximum composition sum applicable to housing developers, for offences prescribed to be compoundable under the HDA, to up to 50% of the maximum fine prescribed for the offence (this is up from the current S$5,000 or 50% of the maximum fine prescribed for the offence, whichever is the lower).
  • Similarly, the SCPA will be amended to introduce a new section applicable to commercial and industrial developers, for the composition of offences prescribed to be compoundable under the SCPA, to up to 50% of the maximum fine prescribed for the offence.
  • The amendments to the HDA and SCPA on the composition regime for developers will also allow for PF-related offences to be compounded.

These amendments ensure that the approach for maximum composition sums for ML, PF and TF offences in the HDA and SCPA will be aligned to other sectors, such as precious stones and metal dealers.

Alignment with FATF Standards

3. Update regulatory regime, including customer due diligence, to cover PF: The EAA, HDA and SCPA will be amended to update the regulatory regime for LEAs, RSPs and developers to cover PF (not just ML or TF, as is currently the case). For example, the EAA amendments will stipulate that LEAs and RSPs must perform prescribed customer due diligence measures where they have reason to suspect PF (not just ML or TF, as is currently the case). These amendments: (i) arise because the FATF recently updated its standards to clearly set out the standards to identify, assess, and mitigate risks associated with PF; and (ii) are similar to the relevant legislative frameworks for other sectors.

4. Require counterparty due diligence in unrepresented transactions: Currently, LEAs and RSPs are only required to conduct due diligence measures on their own clients. To align with the FATF standards, a new EAA section will require LEAs and RSPs doing estate agency work for a client to perform prescribed counterparty due diligence measures on a counterparty who is not represented by any LEA or RSP, in respect of the acquisition or disposition of a property in question, in any the following circumstances:

• • where they have reason to suspect ML, PF or TF; and/or
  • where they have reason to doubt the veracity or adequacy of information obtained from earlier counterparty due diligence measures; and/or
  • under any other prescribed circumstances.

5. Clarify that measures for developers relating to targeted financial sanctions apply to TF and PF (in addition to terrorism): The HDA and SCPA will be amended to require developers to perform prescribed measures related to targeted financial sanctions for “terrorism, terrorism financing and proliferation financing” (not just “terrorism”, as is currently the case).

• • Currently, developers are required to: (i) assess whether a purchaser is designated as a terrorist or terrorist entity under relevant lists or sanctioned by the United Nations; and (ii) if so, decline to enter into or terminate transactions with the potential purchaser, and report the matter to the Singapore Police Force. These amendments clarify that this also applies to purchasers who are on the designated or sanctions lists due to TF and PF (in addition to terrorism).
  • These measures for TF and PF are not new to LEAs, RSPs, and developers, and are already part of existing anti-money laundering requirements as the underlying TF and PF offences are also ML-predicate offences. Efforts to combat TF and PF are also already part of the current measures performed by LEAs, RSPs and developers.

6. Consequential amendments on record-keeping:Consequential amendments will be made to the EAA regarding the keeping of records, to align with the amendments above on customer due diligence and counterparty due diligence.

7. Allow for making of PF-related regulations: Further, the EAA amendments will empower CEA to make regulations for requirements: (i) in relation to the detection and prevention of PF; and (ii) for the reporting of transactions suspected of involving PF (not just ML or TF, as is currently the case).

Clarifying Restrictions against Convicted Persons 

The EAA will be amended to provide that a person (either an individual, or a person other than an individual) is not a “fit and proper person” (for the purposes of determining whether a person may hold an estate agent’s licence or be registered as a salesperson) if they have been convicted of an offence involving ML, PF or TF, whether in Singapore or elsewhere.

Similarly, the HDA and SCPA will be amended to clarify that ML, PF and TF offences include offences under the law of any foreign country or territory. These amendments ensure that persons convicted of such offences, regardless of where they are committed, will be subjected to prohibitions against: (i) becoming a housing developer; (ii) becoming a substantial shareholder of a developer; or (iii) holding a responsible position in a developer or in substantial shareholders of a developer.

Click on the following link for more information:

• Ministry of National Development (“MND“) Press Release titled “2nd Reading Speech by 2M Indranee Rajah for Anti-Money Laundering and Other Matters (Estate Agents and Developers) Bill” (available on the MND website at mnd.gov.sg).