Review of Market Structure and Practices
On 1 August 2014, MAS and SGX announced a suite of measures to strengthen the securities market structure and practices in Singapore. This followed a 12-week public consultation that commenced in February 2014, where responses received were generally positive. The measures include:

  • Minimum trading price of S$0.20 for issuers listed on the SGX Mainboard;
  • Collateral requirement for securities trading;
  • Short position reporting requirements;
  • Enhanced transparency of trading restrictions imposed by securities intermediaries; and
  • Reinforcing the SGX listings and enforcement framework.

MAS worked closely with SGX and the industry to ensure the smooth implementation of these measures. On 31 December 2014, the Securities Association of Singapore issued a set of industry guidelines on trading restrictions for its members. These guidelines ensure that the dissemination of information on trading restrictions is consistent, fair, orderly and transparent. On 2 March 2015, SGX introduced a minimum trading price requirement of S$0.20 for Mainboard-listed companies. Issuers are given a one-year transition period, and will have to comply with this requirement by 1 March 2016. In addition, SGX will establish the independent Listings Advisory Committee, Listings Disciplinary Committee and Listings Appeals Committee in the second half of 2015.

MAS and SGX will continue to engage the industry on the implementation of the short position reporting and collateral requirements, to be implemented in 2016.

On the futures front, Singapore Exchange Derivatives Trading Limited (SGX-DT) obtained approval from the US Commodity Futures Trading Commission (CFTC) as a registered Foreign Board of Trade (FBOT) in January 2015. The FBOT registration allows SGX-DT to provide US customers with direct access to its trading infrastructure.

Over-The-Counter Derivatives Reforms
MAS demonstrated its continued commitment to implement over-the-counter (OTC) derivatives reforms. In February 2015, MAS issued a public consultation on further legislative amendments to complete the expansion of the Securities and Futures Act (SFA) to regulate OTC derivatives. The consultation includes amendments relating to the regulation of OTC derivatives markets and intermediaries, powers to implement mandatory trading of OTC derivatives, as well as the transfer of the regulation of commodity derivatives from the Commodity Trading Act.

Given the cross-border nature of OTC derivatives transactions, supervisory cooperation with foreign counterparts is essential. Following the Australian Securities and Investments Commission's (ASIC's) authorisation of DTCC Data Repository Singapore (DDRS) as a trade repository for Australia's reporting mandate, MAS signed a Data Access Memorandum of Understanding (MOU) with ASIC on 16 September 2014 to facilitate the latter's access to the derivatives trade data held in DDRS.

As an international financial centre, financial market infrastructures in Singapore have to be able to offer their services to both domestic and overseas participants. In 2013, Singapore Exchange Derivatives Clearing Limited (SGXDC) was registered as a Designated Clearing Organisation with the US CFTC. This allows SGXDC to provide clearing services to US persons. Further, Singapore's central counterparty (CCP) regime was assessed to be equivalent by the European Commission in 2014, paving the way for local CCPs to provide clearing services to European participants. Following the successful conclusion of a supervisory MOU between MAS and the European Securities and Markets Authority (ESMA) on 9 March 2015, SGX-DC and the Central Depository (Pte) Limited have been recognised by ESMA to offer services in the European Union.

Review of Regulatory Safeguards for Investors
In July 2014, MAS consulted the public on a package of proposals to enhance regulatory safeguards for investors in the capital markets.

The three key proposals were to:

  • Extend capital market regulatory safeguards to investors in certain non-conventional investment products that are in substance capital raising products;
  • Introduce a tool by which investment products can be rated for their relative complexity and risk of principal loss to empower investors to make more well-informed investment decisions; and
  • Give investors who meet certain wealth thresholds the choice whether to be treated as an accredited investor (AI) with the consequent reduction of regulatory safeguards.

MAS will carefully consider all feedback received and further engage key stakeholders where necessary before implementing the proposals.

Facilitating Bond Offerings to Retail Investors
In December 2014, MAS consulted on draft legislation to facilitate greater access by retail investors to corporate bonds through the following:

  • A bond seasoning framework under which wholesale bonds issued by corporates that satisfy specified eligibility criteria (such as size, listing track record and strong credit profile) may be re-denominated into smaller lot sizes after the bonds have been listed for six months. Eligible corporates will also be exempted from providing a prospectus for additional offers to retail investors of new bonds with the same terms as the re-denominated bonds.
  • An exempt bond issuers framework under which bonds issued by corporates that satisfy even stricter eligibility criteria can be offered directly to retail investors without a prospectus.

MAS is in the process of finalising the legislation.

Electronic Lodgement of Prospectuses and Offers
On 29 July 2014, MAS enhanced Offers and Prospectuses Electronic Repository and Access (OPERA) to enable electronic lodgements of applications for the authorisation or recognition of collective investment schemes (CIS) and their offer documents. In March 2015, a two-factor authentication system was also implemented to enhance security for access to OPERA.

Crowdfunding for Small and Medium Enterprises
In February 2015, MAS published a consultation paper on securities-based crowdfunding (SCF). The paper set out proposals and clarifications to help start-ups, and small and medium enterprises access alternative sources of funding through SCF.

To strike a balance between developing SCF in Singapore and ensuring that there are sufficient safeguards for investors, MAS proposed to facilitate SCF to AIs and institutional investors by:

  • Lowering the current financial requirements for intermediaries that deal in securities, so long as they do not handle or hold customer monies, assets or positions and do not act as principal in transactions with customers. This will allow potential SCF platform operators with lower financial resources to apply for a licence to offer SCF investments; and
  • Clarifying the application of the advertising restriction for offers made to AIs without a prospectus. This clarification will provide certainty to potential SCF platform operators on the manner in which they can publicise their business.

MAS will carefully consider all feedback received and further engage key stakeholders where necessary before finalising the measures.