MAS Invites Comments on Proposed Enhancements to the Regulatory Regime for Fund Management Companies and Exempt Financial Intermediaries
Singapore, 27 April 2010...The Monetary Authority of Singapore (MAS) is reviewing the regulatory regime for financial intermediaries conducting fund management activities and the exemption regime for financial intermediaries engaged in leveraged foreign exchange trading. A consultation paper (Click here to view the Consultation Paper (159.8 KB) and Appendix (62.1 KB)) has been issued to seek comments from the public on proposed enhancements and changes to the regulatory regime.
2 This review is aimed at ensuring that the regulatory regime keeps pace with industry and regulatory developments globally, formalising existing industry best practices, as well as enhancing regulatory oversight over the respective industries. The proposed enhancements also seek to raise the quality and standard of players to foster long term sustainable growth of the fund management industry.
3 The proposals under the consultation paper represent an evolution of the existing regulatory regime for the fund management industry. Fund Management Companies ["FMCs"] whose activities are limited in scale and impact may continue to operate under a notification regime and be subjected to certain conditions. This is similar to the existing framework for exempt fund managers. FMCs who serve retail investors and/or manage or advise on a larger portfolio of assets will have to be licensed. MAS also intends to require all FMCs to meet business conduct as well as capital requirements.
4 Under the proposed business conduct requirements, FMCs will need to maintain customers' monies and assets with independent custodians, ensuring segregation of duties between the functions of fund management and fund administration. FMCs will also need to have compliance arrangements which are commensurate with the size and scale of the FMCs' business. These requirements aim to enhance safeguards against theft or misappropriation of customers' monies.
5 MAS adopts an open and consultative approach with the industry, and remains committed to building Singapore as a fund management and alternative investment hub. In developing this set of proposals, MAS has considered the views and comments from the public, investors, market practitioners and industry associations.
6 MAS invites interested parties to give their views and comments on the proposals contained in the Consultation Paper. The consultation period will end on 31 May 2010.