Securities and Futures (Offers of Investments) (Shares and Debentures) Regulations 2005

No. S 611

Securities and Futures Act

(Chapter 289)

Securities and Futures (Offers of Investments) (Shares and Debentures) Regulations 2005

In exercise of the powers conferred by sections 240, 240A, 243, 249, 251, 262, 272A, 272B, 277, 280, 318, 337, 339, 341 and 343 of the Securities and Futures Act (as amended by the Securities and Futures (Amendment) Act 2005 (Act 1 of 2005)), the Monetary Authority of Singapore hereby makes the following Regulations:

PART I

PRELIMINARY

Citation

1. These Regulations may be cited as the Securities and Futures (Offers of Investments) (Shares and Debentures) Regulations 2005 and shall come into operation on 15th October 2005.

Definitions

2.—(1) In these Regulations, unless the context otherwise requires —

“asset-backed securities” has the same meaning as in section 262(3) of the Act;

“continuously issued structured notes” means structured notes —

(a)	which are issued and offered by a specified financial institution in the ordinary course of its business; and
(b)	of which the terms applicable to each offer are negotiated and agreed upon over-the-counter, at the time of the transaction, between the specified financial institution and the person to whom the offer is made;

“reference assets”, in relation to an offer of structured notes, means —

(a)	any securities, equity interest, commodity or index;
(b)	any basket consisting of any securities, equity interests, commodities or indices;
(c)	any entity or basket of entities; or
(d)	any interest rates or currency exchange rates,

which payments to holders are or will be linked to;

“securitisation transaction” has the same meaning as in section 262(3) of the Act;

“single purpose vehicle” means an entity that is established solely in order to, or a trust that is established solely in order for its trustee to, do either or both of the following:

(a)	act as counterparty to arrangements which involve the use of derivatives to create exposure to assets from which payments to holders of any structured notes are or will be primarily derived;
(b)	issue any structured notes;

“specified financial institution” means —

(a)	any bank licensed under the Banking Act (Cap. 19); or
(b)	any entity, or any entity of a class, specified by the Authority by notification published in the Gazette to be an entity, or an entity of a class, for the purposes of issuing structured notes;

“structured notes” means any type of debentures or units of debentures —

(a)

which are issued —

(i)	pursuant to a synthetic securitisation transaction; or
(ii)	by a specified financial institution; and

(b)

in respect of which —

(i)	either or both of the principal sum and any interest are payable;
(ii)	one or more of the underlying securities, equity interests, commodities and currencies are to be physically delivered; or
(iii)	either or both of the principal sum and any interest are payable, and one or more of the underlying securities, equity interests, commodities and currencies are to be physically delivered,

in accordance with a formula based on one or more of the following:

(A)	the performance of any type of securities, equity interest, commodity or index, or of a basket of more than one types of securities, equity interests, commodities or indices;
(B)	the credit risk or performance of any entity or a basket of entities;
(C)	the movement of interest rates or currency exchange rates;

“synthetic securitisation transaction” means an arrangement involving the use of derivatives to create exposure to assets that are not transferred to or are otherwise a part of an asset pool held by a single purpose vehicle;

“WAP phone” means a wireless application protocol phone.

(2) Any word or expression used in these Regulations which is defined in section 239 of the Act shall have the same meaning as in that section.

(3) Any word or expression used in the Fifth to Sixteenth Schedules shall, unless the context otherwise requires, be interpreted in accordance with this regulation and the Fourth Schedule.

Obligations of specified financial institution

3.—(1) The Authority may, by notice in writing —

(a)	impose such conditions or restrictions on a specified financial institution in relation to the issue of structured notes by the specified financial institution as the Authority thinks fit; and
(b)	at any time vary or revoke any condition or restriction so imposed,

and the specified financial institution shall comply with every such condition or restriction which has not been revoked.

(2) Any specified financial institution which contravenes any condition or restriction imposed under paragraph (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 and, in the case of a continuing offence, to a further fine not exceeding $5,000 for every day or part thereof during which the offence continues after conviction.

Forms

4.—(1) The forms to be used for the purposes of Division 1 of Part XIII of the Act and these Regulations are those set out at the Authority’s Internet website at http://www.mas.gov.sg (under “Legislation and Notices”, “Securities and Futures”), and any reference in these Regulations to a numbered form shall be construed as a reference to the current version of the form bearing the corresponding number which is displayed at that website.

(2) Any document required to be lodged with the Authority under any provision of Division 1 of Part XIII of the Act or these Regulations shall be lodged using Form 1.

(3) All forms used for the purposes of Division 1 of Part XIII of the Act and these Regulations shall be completed in the English language and in accordance with such directions as may be specified in the form or by the Authority.

(4) The Authority may refuse to accept any form if —

(a)	it is not completed or lodged in accordance with this regulation; or
(b)	it is not accompanied by the relevant fee referred to in regulation 5.

Fees

5.—(1) Subject to paragraph (2), the fees specified in the First Schedule shall be payable to the Authority for the purposes specified therein, and shall not be refundable.

(2) The Authority may waive in whole or in part any fee under item 4, 5 or 20 of the First Schedule as it thinks fit.

Made this 19th day of September 2005.

HENG SWEE KEAT

Managing Director,
Monetary Authority of Singapore.

[SFD-CFD 017/2005; AG/LEG/SL/289/2005/14 Vol. 6]

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