Promoters of abusive PIC arrangements
37IE.—(1)  A person who promotes any PIC arrangement knowing or having reasonable grounds to believe that the arrangement is abusive shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $10,000 or to imprisonment for a term not exceeding 3 years or to both.
(2)  In subsection (1), a person promotes a PIC arrangement if the person —
(a)designs, facilitates, organises or manages that arrangement or any part of that arrangement; or
(b)publishes, disseminates or communicates any information, by any means or in any form, for the purpose of inducing or encouraging (whether directly or indirectly) any other person to enter into the arrangement or any transaction forming part of the arrangement.
(3)  In subsection (1), a PIC arrangement is abusive if —
(a)it consists or makes use of one or more artificial, contrived or fraudulent steps that is intended to assist any person who enters into the arrangement or a transaction forming part of the arrangement to achieve the relevant purpose;
(b)the arrangement will result in the consideration payable for any property or services being of a greater value than the open market value of the property or services, and there is no bona fide commercial reason for the difference in the values apart from the relevant purpose; or
(c)in any other case, there is no bona fide commercial reason for a person to enter into the arrangement or a transaction forming part of the arrangement apart from the relevant purpose.
(4)  The examples of abusive PIC arrangements in section 37ID(10) apply for the purposes of subsection (3).
(5)  Where, in any proceedings for an offence under subsection (1), it is proved that the arrangement in question consists or makes use of an artificial, contrived or fraudulent step which is capable of assisting any person who enters into the arrangement or a transaction forming part of the arrangement to achieve the relevant purpose, then it is presumed that the step is intended for the relevant purpose, unless the contrary is proved.
(6)  Where, in any proceedings for an offence under subsection (1), it is proved that —
(a)the arrangement in question will result or has resulted in the consideration paid or payable for any property or services being of a greater value than the open market value of the property or services; and
(b)the difference in the values cannot be justified on the basis of any prevailing practice of the trade, profession or business concerned (not being a practice adopted for the purpose of achieving the relevant purpose),
then it is presumed that there is no bona fide commercial reason for the difference in the values apart from the relevant purpose, unless the contrary is proved.
(7)  The Comptroller may compound any offence under subsection (1).
(8)  In this section —
“PIC arrangements”, “PIC cash payout”, “PIC bonus” and “PIC enhanced deduction” have the respective meanings given to them in section 37ID;
“relevant purpose” means the purpose of obtaining a PIC cash payout, PIC bonus or PIC enhanced deduction, or a higher amount of PIC cash payout, PIC bonus or PIC enhanced deduction.
[Act 37 of 2014 wef 27/11/2014]