Issue #4: 2021 | Key items proposed into the Omnibus Act for the financial sector

18 May 2021

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On 21 July 2020, the Monetary Authority of Singapore (“MAS”) released a consultation paper to seek feedback in relation to a proposed new omnibus act for the financial sector (“Omnibus Act”).

Provisions that apply across some or all financial institution classes under the MAS Act will be moved over to, or replicated in, the New Act. These provisions relate to the following:

• Prevention of money laundering and terrorism financing

• The control and resolution of financial institutions

• The oversight of financial sector dispute resolution schemes

• Harmonized and expanded power to issue prohibition orders

• Regulation of virtual asset service providers created in Singapore for anti-money laundering and countering of financing of terrorism purposes

• Provision of statutory protection from liability for mediators, adjudicators, and employees of an operator of an approved dispute resolution scheme

The consultation paper proposes the creation of a new class of financial institutions – Digital Tokens (DT) service providers, these are entities that are created in Singapore and are carrying on a business of providing VA activities outside of Singapore.

MAS intends to apply licensing and ongoing requirements to regulate the DT service providers. The requirements include:

• Having at least one executive director who is a resident in Singapore

• Registered as a company in Singapore

• Having a permanent place of business in Singapore

• To satisfy financial requirements prescribed by MAS

• To ensure the Directors, CEO’s or any equivalent personnel is fit and proper person.

MAS does not intend to provide any low-risk exceptions for DT service providers, and they are subject to the complete set of AML/CFT requirements found in PSN02 notice in the PS Act.

This proposed Omnibus Act is the result of recognition of the increasing need for a financial sector-wide regulatory approach. This will complement MAS’s entity- and activity-based regulation in addressing the emerging risks and challenges that impact the financial sector.

Click here to access the MAS consultation paper for more reference.

Interested to find out more? Contact: general@magnalawcorp.com

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