3.—(1) Subject to paragraphs (2), (3) and (4), Hong Leong Finance Limited, Sing Investments & Finance Limited, and Singapura Finance Ltd (each called in this regulation an exempt finance company) are exempt from —| (a) | sections 23(1)(a) and 25(2) of the Act in respect of the business of opening current accounts with facilities for —| (i) | the issuance of cheques by any business customer of the exempt finance company; | | (ii) | the payment of cheques drawn on the exempt finance company by any business customer of the exempt finance company; and | | (iii) | the collection of cheques drawn by any business customer of the exempt finance company; |
| | (b) | section 23(1)(b) of the Act in respect of the following activities:| (i) | the business of entering into or offering to enter into, or facilitating the entering into by a person of, a contract or an arrangement the effect of which is to enable a business customer of the exempt finance company to hedge, cover or change the amount of a liability or an entitlement —| (A) | from one foreign currency to another foreign currency or to Singapore dollars; or | | (B) | from Singapore dollars to a foreign currency; |
| | (ii) | financing the purchase of assets in foreign currency; | | (iii) | financing foreign currency denominated invoices under factoring and accounts receivable financing; |
| | (c) | section 23(1)(f) of the Act in respect of unsecured advances, unsecured loans or unsecured credit facilities granted to a person for a purpose relating to the person’s business; and | | (d) | section 25(2) of the Act in respect of the business of —| (i) | issuing corporate purchasing cards; and | | (ii) | providing electronic funds transfer services by using the interbank GIRO, fast and secure transfers (FAST) or electronic funds transfer at point of sale network systems. |
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(2) The exemption in paragraph (1)(b) is subject to the following conditions:| (a) | the aggregate amount of foreign currency exposure of the exempt finance company must not exceed 10% of its capital funds; | | (b) | the exempt finance company must not carry on foreign exchange trading for its own account; | | (c) | the aggregate amount of foreign currency exposure not hedged by the exempt finance company must not exceed $500,000. |
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(3) The exemption in paragraph (1)(c) is subject to the following conditions:| (a) | the exempt finance company must not grant unsecured advances, unsecured loans and unsecured credit facilities that, in the aggregate and outstanding at any one time, exceed 15% of the capital funds of the exempt finance company; | | (b) | the unsecured advances, unsecured loans and unsecured credit facilities granted to any person or body of persons, whether incorporated or not, must not, in the aggregate and outstanding at any one time, exceed 0.5% of the capital funds of the exempt finance company. [S 591/2020 wef 27/07/2020] |
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(4) The exemption in paragraph (1)(c) does not apply to unsecured advances, unsecured loans or unsecured credit facilities granted by the exempt finance company to the following persons:| (a) | any of the exempt finance company’s directors, whether or not those advances, loans or credit facilities are obtained by its directors jointly or severally; | | (b) | a firm in which —| (i) | the exempt finance company, or any of its directors, has an interest as a partner; or | | (ii) | any director of the exempt finance company is a manager or an agent; |
| | (c) | any individual for whom, or firm for which, any of the exempt finance company’s directors is a guarantor; | | (d) | a company (other than a public company, the securities of which are listed on an approved exchange, and a subsidiary of that public company) —| (i) | in which any of the exempt finance company’s directors, whether legally or beneficially, owns more than 50% of the issued capital; or | | (ii) | in which any of the exempt finance company’s directors controls the composition of the board of directors; |
| | (da) | a non-umbrella VCC (other than a VCC the units of which are listed on an approved exchange, and a subsidiary of that VCC) where any of the directors of the exempt finance company —| (i) | owns (whether legally or beneficially) more than 50% of the issued capital of the non-umbrella VCC; or | | (ii) | controls the composition of the board of directors of the non-umbrella VCC; |
[S 165/2022 wef 08/03/2022] | | (db) | an umbrella VCC in respect of a sub-fund the units of which in respect of that sub-fund are not listed on an approved exchange, where any of the directors of the exempt finance company —| (i) | owns (whether legally or beneficially) more than 50% of the issued capital of the umbrella VCC in respect of that sub-fund; or | | (ii) | controls the composition of the board of directors of the umbrella VCC; |
[S 165/2022 wef 08/03/2022] | | (e) | any corporation, other than a bank, that is deemed to be related to the exempt finance company under section 6 of the Companies Act (Cap. 50). |
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