The Monetary Authority of Singapore (MAS) issued a consultation paper on 2 July 2021 seeking views on various proposals, including to introduce powers to enable the MAS to impose requirements on certain financial institutions conducting unregulated business.
The MAS recognises that some of its regulated entities may be carrying on unregulated activities (e.g. trading bitcoin futures on overseas exchanges) and that there is a need to manage the risks arising from such unregulated activities. For example, investors may not be aware that such activities are not in fact regulated as they are being conducted by regulated entities. The MAS is thus proposing to introduce a provision in the SFA to enable the MAS to issue binding directions to regulated financial institutions (and their representatives) in relation to their unregulated business. Such directions may relate to standards to be maintained, the manner in which the unregulated business is being conducted, method and place of soliciting business, qualifications of the representatives involved etc.
Such powers, intended to be exercised by the MAS if necessary or expedient in the interests of the public or for the protection of investors, will give MAS the power to effectively direct currently unregulated activities where it is undertaken by entities regulated on other grounds.