Reed Smith Client Alerts

On 21 July 2020, the Monetary Authority of Singapore (MAS) published a “Consultation Paper on a Proposed New Omnibus Act for the Financial Sector” (the CP). The CP sets out proposals relating to the expansion of supervisory powers by the MAS in a range of important areas, including (among others) additional powers to take enforcement action against individuals, to apply new licensing requirements to certain types of virtual asset service provider (VASP), and to impose technology risk management (TRM) requirements. The consultation is therefore likely to receive significant attention from the financial services industry. The CP also has far-reaching implications for the overall structure of the Singapore financial services regulatory framework.

Autoren: Hagen Rooke Charmian Aw M. Tamara Box Claude Brown Lee Ann Dillon David Adelman Janet Bo Chun Cheung Johnny Lim (Resource Law LLC)

Background

The MAS’ proposals in the CP are driven by multiple considerations, including a perceived need to consolidate key supervisory powers of the MAS into a standalone legislative framework (namely, an Omnibus Act), a need to expand the scope of regulatory supervision to address apparent gaps, and Singapore’s commitment to implement the anti-money laundering and countering-the-financing-of-terrorism (AML/CFT) guidance issued by the Financial Action Task Force (FATF) in relation to VASPs.

The proposed starting-point for this reform initiative is a transfer of supervisory powers of the MAS from the Monetary Authority of Singapore Act (Cap. 186) (MAS Act) to the Omnibus Act. The MAS Act sets out the MAS’ structure and competencies as a statutory board, but has over the years been amended intermittently to accommodate additional supervisory powers. Pursuant to the proposals in the CP, existing provisions relating to AML/CFT, the control and resolution of financial institutions (FIs) and the oversight of financial sector dispute resolution schemes would be transferred from the MAS Act to the Omnibus Act. Concurrently, the regulatory framework would be expanded in key areas, as further detailed below.