Insurance Act - Singapore Statutes Online

Division 2 — Compulsory transfer of business

Interpretation of this Division

49FE. In this Division, unless the context otherwise requires —

“business” includes affairs, property, right, obligation and liability;

“certificate” means a certificate of transfer issued by the Minister under section 49FG(1);

“debenture” has the same meaning as in section 4(1) of the Companies Act (Cap. 50);

“determination” means a determination of the Authority under section 49FF(1);

“property” includes property, right and power of every description;

“specified business” means that part of the business of a transferor which is specified or identified in a certificate;

“transferee” means a registered insurer, a company or a co-operative society registered under the Co-operative Societies Act (Cap. 62) which has applied for or will be applying for a registration to carry on the relevant class or classes of business to be transferred in Singapore, as the case may be, to which the whole or part of a transferor’s business is, or is to be, or is proposed to be, transferred under this Division;

“transferor” means a registered insurer, the whole or part of the business of which is, or is to be, or is proposed to be, transferred under this Division.

[16/2011 wef 01/05/2011]

Compulsory transfer of business

49FF.—(1) Subject to subsections (2), (3) and (7), the Authority may make a determination that the whole or any part of the business of a transferor (including its non-insurance business) shall be transferred to a transferee which is registered to carry on the relevant class or classes of insurance business to be transferred in Singapore if —

(a)

any ground exists under section 41(1) for the Authority to exercise any power under section 41(2) in relation to the transferor, whether or not the Authority has exercised the power;

(b)

the board of directors of the transferee has consented to the transfer;

(c)

the Authority is satisfied that the transfer is appropriate, having regard to —

(i)	the interests of the policy owners of the transferor given priority and the order of priority of each class of policy owners under section 49FR;
(ii)	the interests of the policy owners of the transferee given priority and the order of priority of each class of policy owners under section 49FR;
(iii)	the stability of the financial system in Singapore;
(iv)	whether the PPF Agency has to make a payout from any of the PPF Funds to the transferee and the amount of such payout, if any; and
(v)	any other matter that the Authority considers relevant; and

(d)

the transfer involves the whole or part of the insurance business of the transferor.

[16/2011 wef 01/05/2011]

(2) Any determination made by the Authority for the purpose of subsection (1) may include a determination as to whether guaranteed policy moneys in relation to any policy should be adjusted after the proposed transfer.

[16/2011 wef 01/05/2011]

(3) Where the transferor is a registered insurer incorporated or established outside Singapore, any determination shall only be in respect of the transferor’s business (or any part thereof) which is reflected in the books of the transferor in Singapore in relation to the transferor’s operations in Singapore and the reference to policy owners in subsection (1)(c)(i) shall be construed accordingly.

[16/2011 wef 01/05/2011]

(4) The Authority may, before making a determination, appoint one or more persons to perform an independent assessment of the proposed transfer of the business (or any part thereof) of the transferor for the purpose of providing a report on the transfer to the Authority, including an assessment —

(a)	as to the compensation, if any, that should be paid by the transferee; and
(b)	as to whether guaranteed policy moneys in relation to any policy should be adjusted after the proposed transfer. [16/2011 wef 01/05/2011]

(5) The remuneration and expenses of a person appointed under subsection (4) shall be borne by the transferor.

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(6) The Authority shall serve a copy of any report furnished under subsection (4) on the transferor and the transferee.

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(7) A determination may provide for the transfer of the business (or any part thereof) of the transferor to a transferee who is not registered to carry on the relevant class or classes of insurance business in Singapore on terms that the transfer is to take effect only in the event of the transferee becoming so registered.

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(8) Upon making a determination, the Authority shall submit the determination to the Minister for his approval.

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(9) Before approving the determination, the Minister shall, unless he decides that it is not practicable or desirable to do so —

(a)	publish in the Gazette and in such newspaper or newspapers as the Minister may determine a notice of his intention to approve the determination, specifying such particulars as the Minister considers appropriate; and
(b)	cause to be given to the transferor notice in writing of his intention to approve the determination, specifying such particulars as the Minister considers appropriate and the date by which the transferor may make written representations to the Minister. [16/2011 wef 01/05/2011]

(10) In determining the period within which written representations have to be made under subsection (9), the Minister shall take into account the need for the transfer to be effected expeditiously in the interest of the stability of the financial system in Singapore.

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(11) Upon receipt of any written representation, the Minister shall consider the representation for the purpose of deciding whether to approve the determination.

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(12) Where the transferor is a registered insurer established or incorporated in Singapore, the Minister shall not approve the determination unless he is satisfied that it is in the public interest to do so.

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(13) The Minister may —

(a)	approve the determination without modification;
(b)	approve the determination subject to any modification he considers appropriate if the transferee, or where the transferee is a corporation, its board of directors of the transferee has agreed to the modification; or
(c)	refuse to approve the determination. [16/2011 wef 01/05/2011]

(14) An approval under subsection (13) shall be subject to such conditions as the Minister may determine and the Minister may add to, vary or revoke any such conditions.

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(15) The transferor or transferee, as the case may be, shall comply with the conditions referred to in subsection (14).

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(16) A determination, the approval of a determination under this section or the issue of a certificate shall not preclude the exercise of any other power by the Authority or the Minister under this Act.

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Certificate of transfer

49FG.—(1) If the Minister approves a determination, he shall, as soon as practicable, issue a certificate of transfer which shall come into effect on the date specified by the Minister in the certificate.

[16/2011 wef 01/05/2011]

(2) The certificate shall specify such information as may be prescribed.

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(3) The certificate may make provision for all or any of the following matters:

(a)	the transfer to the transferee of the whole or any part of the business of the transferor;
(b)	whether guaranteed policy moneys in relation to any policy should be adjusted after the proposed transfer;
(c)	the allotment or appropriation by the transferee of any share, debenture, policy or other interest in the transferee which under the transfer is to be allotted or appropriated by the transferee to or for any person;
(d)	any property which is held by the transferor as trustee;
(e)	any future or contingent right or liability of the transferor;
(f)	the coming into effect of the transfer of any specified business on a date other than the date on which the certificate comes into effect;
(g)	the compensation, if any, to be paid by the transferee to the transferor and the period within which the compensation is to be paid;
(h)	such incidental, consequential and supplementary matters as are, in the Minister’s opinion, necessary to secure that the transfer is fully effective, including conditions relating to the transfer. [16/2011 wef 01/05/2011]

(4) The Minister may at any time before the certificate comes into effect add to, vary or revoke any matter specified in the certificate.

[16/2011 wef 01/05/2011]

(5) The Authority shall cause the certificate and any addition, variation or revocation referred to in subsection (4) to be served on the transferor and the transferee and published in the Gazette and in such newspaper or newspapers as the Minister may determine, on or before the date on which the certificate comes into effect.

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(6) Subject to subsection (7), unless otherwise specified in the certificate, the transfer of the business (or any part thereof) of the transferor under the certificate shall take effect on the date on which the certificate comes into effect.

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(7) Where the transferee is not registered to carry on insurance business or the relevant class of business in Singapore, the transfer of the business (or any part thereof) of the transferor shall not come into effect unless the transferee becomes so registered.

[16/2011 wef 01/05/2011]

(8) Notwithstanding any written law or rule or law, upon the date on which the transfer of the business (or any part thereof) of the transferor comes into effect under the certificate —

(a)	subject to subsection (10), the business (or any part thereof) shall be transferred to and vest in the transferee without other or further assurance, act or deed and the certificate shall have effect according to its tenor and be binding on any person thereby affected;
(b)	all deeds, bonds, agreements and other arrangements subsisting immediately before that date which relate to the business (or any part thereof), and to which the transferor is a party shall, taking into account the adjustments as may be specified in the certificate to be made to guaranteed policy moneys payable under such agreements or arrangements, continue in full force and effect, and shall be enforceable by or against the transferee, as from that date as if the transferee had been named therein or had been a party thereto instead of the transferor; and
(c)	any proceedings or cause of action, by or against the transferor, pending or existing immediately before that date and relating to the business (or any part thereof) may be continued and shall be enforced by or against the transferee as from that date. [16/2011 wef 01/05/2011]

(9) For the avoidance of doubt —

(a)	the business (or any part thereof) of the transferor shall be transferred to and vest in the transferee in accordance with subsection (8) notwithstanding any incapacity of the transferor; and
(b)	where guaranteed policy moneys under a policy has been adjusted (hereafter referred to as adjusted guaranteed policy moneys), the policy owner or claimant shall continue to have recourse against the transferor for the difference between the original guaranteed policy moneys and the adjusted guaranteed policy moneys. [16/2011 wef 01/05/2011]

(10) The certificate shall not have any effect or operation in transferring or otherwise vesting land in Singapore until the appropriate entries are made with respect to the transfer or vesting of that land by the appropriate authority.

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(11) Section 259 of the Companies Act (Cap. 50) shall not apply to the transfer of any property under the certificate.

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(12) If any specified business is governed by the law of any foreign country or territory, the certificate may require the transferor, if the transferee so requires, to take all necessary steps for securing that the transfer of the specified business to the transferee is fully effective under the law of that country or territory.

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(13) The transferee and the transferor shall each lodge, within 7 days after being served with the certificate —

(a)	a copy of the certificate with the Registrar of Companies or, in the case of societies registered under the Co-operative Societies Act (Cap. 62), with the Registrar of Co-operative Societies; and
(b)	where the certificate relates to land in Singapore, an office copy of the certificate with the appropriate authority concerned for the registration or recording of dealings in that land. [16/2011 wef 01/05/2011]

(14) A transferor or a transferee which fails to comply with any provision in the certificate shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part thereof during which the offence continues after conviction.

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(15) A transferor which fails to comply with subsection (12) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part thereof during which the offence continues after conviction.

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(16) A transferor or a transferee which fails to comply with subsection (13) and every officer of the transferor or the transferee who fails to take all reasonable steps to secure compliance by the transferor or the transferee, as the case may be, with that subsection shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $2,000 and, in the case of a continuing offence, to a further fine not exceeding $200 for every day or part thereof during which the offence continues after conviction.

[16/2011 wef 01/05/2011]

Moratorium, avoidance of disposition of property, etc.

49FH.—(1) Notwithstanding section 41E and subject to section 49FQ, no resolution shall be passed, and no order shall be made, for the winding up of a transferor during the period —

(a)

beginning on —

(i)	the date on which the Minister publishes the notice under section 49FF(9) in the Gazette on the transfer of the business (or any part thereof) of the transferor; or
(ii)	where the notice is not published in the Gazette, the date on which the Authority publishes the certificate under section 49FG(5) in the Gazette on the transfer of the business (or any part thereof) of the transferor; and

(b)

ending on —

(i)	the date on which the certificate comes into effect; or
(ii)	where the certificate specifies a different date for the coming into effect of the transfer of any specified business, the last date on which the transfer of every specified business has come into effect. [16/2011 wef 01/05/2011]

(2) Notwithstanding section 41E and subject to section 49FU, during the period beginning with the date on which the Minister publishes the notice under section 49FF(9) in the Gazette on the transfer of a specified business of the transferor or, where the notice is not published in the Gazette, the date on which the Authority publishes the certificate under section 49FG(5) in the Gazette on the transfer of the specified business and ending with the date on which the transfer of the specified business comes into effect —

(a)	no proceedings shall be commenced or continued against the transferor in respect of the specified business;
(b)	no execution, distress or other legal process shall be commenced, levied or continued against the specified business;
(c)	no steps shall be taken to enforce any security over the specified business or repossess from the transferor the specified business under any hire-purchase agreement, chattels leasing agreement or retention of title agreement; and
(d)	any sale, transfer, assignment or other disposition of the specified business shall be void, except for any payment of claims to policy owners or claimants (other than policy owners who are related corporations of the transferor). [16/2011 wef 01/05/2011]

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