THE FINANCIAL SECTOR: KEY SUPERVISORY AND REGULATORY INITIATIVES       Content Page Supervision Regulation Risk-based Regulatory Regime Fine-Tuning Regulatory framework Ensuring Sound Market Conduct Innovative Systems for Efficient Payment and Settlement     ENSURING SOUND MARKET CONDUCT   . Developing Framework for Composition of Offences . Publishing Unlicenced Operators . Box 6 – Integrated Dispute Resolution Scheme . Improving Corporate Disclosure . Enhancing Management of Insurance Agents . Helping Consumers Better Understand “Critical Year” . Regulatory Frameworks for Business Trusts and Trust Companies . Consulting Industry on CIS . Box 7 – MoneySENSE – Singapore’s Financial Education Programme . Box 8 – Boosting Research . Health Insurance and Changing Demographics . Box 9 – Coping with E-Banking Risks   Regulatory Frameworks for Business Trusts and Trust Companies   MAS will be introducing a framework to regulate business trusts. A business trust is an alternative structure under which a business enterprise can be structured. The business’ assets, which are held in trust and managed by a trustee, are beneficially owned by investors who hold units in the business trust. Introducing business trusts as a new asset class will add further depth and vibrancy to Singapore’s capital markets. The proposed regulatory framework for business trusts aims to:   • Set out the fundamental rights of investors and creditors in a business trust. • Clearly establish the duties and accountability of trustees and their directors. • Regulate offers of units in business trusts.   The public consultation on the policy framework to regulate business trusts was concluded in January 2004. The draft Business Trusts Act and related amendments to the SFA will be introduced in Parliament in the second half of 2004. We are also creating a new regulatory framework for trust companies. Trust companies are service providers that engage in the business of acting as trustee or administering trusts. They may also create trusts or arrange for another person to act as trustee. Trust companies are currently regulated by the Accounting and Corporate Regulatory Authority under the current Trust Companies Act. MAS will regulate trust companies under the new framework, which includes a new Trust Companies Act. The framework will increase legal clarity and provide guidance for trust companies in Singapore and ensure high standards of business conduct, professionalism and competence in the trust services industry. The new framework will apply to all trust companies and will incorporate measures not covered in the existing regulation, such as anti-money laundering.