Knowledge Highlights 9 June 2022
The Accounting and Corporate Regulatory Authority (“ACRA”) is conducting a public consultation on proposed amendments to the Companies Act 1967 and the Accounting and Corporate Regulatory Authority Act 2004 and the introduction of a new Corporate Service Providers Bill (“CSP Bill”). The consultation closes on 19 July 2022.
In 2015, the Accounting and Corporate Regulatory Authority Act 2004 was amended to require filing agents and qualified individuals to be registered and comply with the recommendations of the Financial Action Task Force (“FATF”) relating to the combating of money laundering, terrorism financing and financing of proliferation of weapons of mass destruction.
ACRA’s proposals aim to enhance the sector’s regulatory regime to:
- improve Singapore’s compliance with the FATF recommendations and maintain Singapore’s reputation as a trusted financial hub; and
- address the risks presented by the misuse of nominee arrangements in the creation of shell companies to facilitate money laundering, and to require individuals who act as nominee directors, by way of business, to be qualified persons.
Proposed enhancements to the regulatory regime
The key legislative proposals are:
- to enact a new CSP Bill requiring all entities or persons providing corporate secretarial services in and from Singapore to register with ACRA as corporate service providers (“CSPs”), regardless of whether they need to transact with ACRA;
- to increase financial penalties on registered filing agents, CSPs and registered qualified individuals for breaches of terms and conditions of their registration, and introduce a fine for breaches of anti-money laundering/countering the financing of terrorism obligations committed with the connivance of or through the neglect by individuals like directors, owners or partners of CSPs;
- to introduce in the CSP Bill a requirement for CSPs to ensure that individuals they appoint to act as nominee directors are fit and proper, and satisfy prescribed training requirements, if they hold more than a legally prescribed number of nominee directorships by way of business (unless they are qualified persons);
- to introduce a new requirement for nominee directors and shareholders to disclose their nominee status and the identity of their nominator to ACRA, and for ACRA to maintain such information which will be made publicly available - this follows an amendment to the FATF Recommendations in February 2022 to enhance the transparency of nominee arrangements.
The following materials are available on the ACRA website www.acra.gov.sg: