2. Regulation 2 of the Income Tax (Income from Funds Managed for Foreign Investors) Regulations 2003 (G.N. No. S 640/2003) (referred to in these Regulations as the principal Regulations) is amended —| (a) | by inserting, immediately after the definition of “approved start-up fund manager” in paragraph (1), the following definition:| “ “commodity derivatives” means derivatives, whether traded over-the-counter or on an exchange, the payoffs of which are linked in whole to the payoffs or performance of the underlying commodity;”; |
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| | (b) | by deleting the word “and” at the end of paragraph (n) of the definition of “designated investments” in paragraph (1); | | (c) | by inserting, immediately after paragraph (o) of the definition of “designated investments” in paragraph (1), the following paragraphs:| “(p) | loans that are —| (i) | granted by the foreign investor to any company incorporated outside Singapore which is neither a resident nor permanent establishment in Singapore, where no interest, commission, fee or other payment in respect of the loan is deductible against any income of that company accruing in or derived from Singapore; or | | (ii) | granted by a person other than the foreign investor but traded by the foreign investor; |
| | (q) | commodity derivatives; and | | (r) | physical commodities if —| (i) | the trading of those physical commodities by the foreign investor in the basis period for any year of assessment is done in connection with and is incidental to its trading of commodity derivatives (referred to in this paragraph as related commodity derivatives) in that basis period; and | | (ii) | the trade volume of those physical commodities traded by the foreign investor in that basis period does not exceed 15% of the total trade volume of those physical commodities and related commodity derivatives traded by the foreign investor in that basis period;”; |
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| | (d) | by deleting paragraph (b) of the definition of “foreign investor” in paragraph (1) and substituting the following paragraph:| “(b) | in relation to a company, means a company not resident in Singapore where —| (i) | in the case where the company is incorporated before 15th February 2007, not more than 20% (excluding the total percentage owned directly by designated persons) of the total number of its issued shares are beneficially owned, directly or indirectly, by persons who are citizens of Singapore or resident in Singapore; or | | (ii) | in the case where the company is incorporated on or after 15th February 2007, not more than 20% (excluding the total percentage owned directly by designated persons) of the total value of its issued securities are beneficially owned, directly or indirectly, by persons who are citizens of Singapore or resident in Singapore; and”; |
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| | (e) | by inserting, immediately after the definition of “foreign investor” in paragraph (1), the following definition:“ “issued securities” means —| (a) | debentures, stocks or shares; | | (b) | any right, option or derivative in respect of any such debentures, stocks or shares; | | (c) | any right under a contract for differences or under any other contract the purpose or pretended purpose of which is to secure a profit or avoid a loss by reference to fluctuations in —| (i) | the value or price of any such debentures, stocks or shares; | | (ii) | the value or price of any group of any such debentures, stocks or shares; or | | (iii) | an index of any such debentures, stocks or shares, |
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| and includes derivatives of a buy-sell nature, but does not include — |
| (A) | futures contracts which are traded on a futures market; | | (B) | bills of exchange; | | (C) | promissory notes; or | | (d) | certificates of deposit issued by a bank or finance company;”; |
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| | (f) | by deleting the words “and (l)” in paragraph (d) of the definition of “specified income” in paragraph (1) and substituting the words “, (l), (p), (q) and (r)”; | | (g) | by deleting paragraph (h) of the definition of “specified income” in paragraph (1) and substituting the following paragraph:| “(h) | discounts from qualifying debt securities which —| (i) | are issued during the period from 27th February 2004 to 16th February 2006 and which mature within one year from the date of issue of those securities; or | | (ii) | are issued during the period from 17th February 2006 to 31st December 2008;”; |
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| | (h) | by inserting, immediately after the words “issued shares” in paragraph (2), the words ”or securities, as the case may be,”; and | | (i) | by inserting, immediately after paragraph (4), the following paragraph:| “(5) Any reference in these Regulations to the value of issued securities of a company is a reference to the value of those securities at the time of their issue by the company.”. |
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