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OUR MISSION
OUR OBJECTIVES
 
Supervision
Inspections and
Supervisory Reviews
New Legislation
Enhancing Regulatory Frameworks
Market and Business Conduct
Risk Management
B THE FINANCIAL SECTOR: KEY SUPERVISORY
AND REGULATORY INITIATIVES
 
  Enhancing Regulatory Frameworks 45
 
Regulations for Islamic Finance  
45
 
Revision to Requirements on Submission of  
Annual Audited Accounts  
45
 
Revision to Regulatory Framework for Money
 
Changers/Remittance Agents  
46
 
Box 9 – Policy Owners’ Protection Fund Scheme  
46
 
Phase II Amendments to the Securities
 
Futures Act and Financial Advisors Act  
47
 
Keeping Pace with Product Innovation  
49
 
Reviewing the Authorisation Framework for Representatives  
49
 
Establishing Sound Risk Management Guidelines  
49
 
Box 10 – Enhancing Internet Banking Security  
50
 
  ENHANCING REGULATORY FRAMEWORKS

Phase II Amendments to the Securities Futures Act and
Financial Advisors Act
 

The Securities and Futures (Amendment) Bill 2005 and the Financial Advisers (Amendment) Bill 2005 were passed by Parliament in January 2005. MAS subsequently issued Subsidiary Legislation and Guidelines operationalising these amendments in the second half of 2005, after taking into account feedback received in the course of public consultations.

These amendments were aimed at strengthening the market and disclosure-based regulatory approach underpinning the Securities and Futures Act (SFA) and the Financial Advisors Act (FAA), enhancing confidence in our markets, and encouraging continued innovation and growth.

Some of the Regulations and Guidelines issued were:

  Regulations and Guidelines for Markets, Clearing Facilities and
Approved Holding Companies
 

The SFA amendments are designed to clarify MAS’ framework for regulating markets as approved exchanges or recognised market operators depending on their systemic importance. We introduced a new designation approach for clearing facilities to replace the approval regime. This approach allows MAS to designate and regulate clearing and settlement systems that are systemically important. We also set out an approval process for amendments to business rules of approved exchanges and designated clearing houses.

Through the issuance and refinement of guidelines, we provided market participants with a better understanding of how MAS will administer the legislative provisions relating to markets and clearing facilities.

  Regulations Relating to Offers of Investments
 

The amendments to the offers of investments provisions in the SFA aim to strengthen our disclosure-based regulatory regime and clarify existing rules to enhance Singapore’s position as an international financial centre. All offers of investments must now be accompanied by prospectuses unless exempted. Small offers raising up to S$5 million and private placements made to no more than 50 persons (both within any 12-month period) will not need to be accompanied by a prospectus. These new ‘safe harbour’ offerings enable small issuers to raise funds with less regulatory costs. Separate disclosure requirements have also been introduced to facilitate offers of structured notes. In addition, the disclosure requirements for prospectuses have been augmented to improve the content of prospectuses. These regulatory amendments are part of MAS’ on-going efforts to facilitate capital fund-raising and promote innovative financial products, while safeguarding the public interest.

  Regulations Pursuant to the FAA
 

To ensure that the regulation of financial advisers remains relevant and risk-focused, MAS exempted financial advisors (FAs) from complying with certain business conduct requirements when providing services to institutional investors, related corporations, connected persons, and overseas investors. We also put in place new requirements to ensure that FAs disclose to overseas investors such exemptions, and disclose to accredited and expert investors any exemptions granted under the FAA.