Legislation Update

New Acts

Singapore Armed Forces (Amendment) Act 2000 (A9/2000)

The Singapore Armed Forces Act has been amended for the following purposes:

1. to empower the Chiefs of Air Force, Army and Navy to try summarily and punish officers of the rank of lieutenant-colonel, to empower the Chief of Defence Force to try summarily and punish officers of the rank of colonel, and to empower the Senior Disciplinary Committee to try summarily and punish officers of the rank of brigadier-general;
2. to establish a new provident fund scheme called the Premium Plan which is to apply to soldiers, in addition to the existing SAVER Plan which applies to officers; and to rename the existing SAVER fund as the SAVER-Premium Fund, which is to be used to meet the payment of all benefits under both the SAVER Plan and the Premium Plan; and
3. to empower the Armed Forces Council to make regulations in respect of the SAVER Plan and the Premium Plan for the payment of loans or other benefits to servicemen.

The amendments are effective from 31 March 2000.

Mutual Assistance In Criminal Matters Act 2000 (A12/2000)

The Mutual Assistance In Criminal Matters Act 2000 has come into force on 1 April 2000. The Act facilitates the provision and obtaining, by Singapore, of international assistance in criminal matters. It provides the legislative basis for Singapore to enter into arrangements with other countries for international co-operation in criminal matters. The forms of assistance provided for by the Act include:

1. the obtaining of evidence and other articles;
2. the making of arrangements for persons to give evidence or assist in criminal investigations;
3. the recovery and forfeiture of, and the restraining of dealings in, proceeds and instrumentalities of crime;
4. the execution of requests for search and seizure;
5. the location and identification of persons; and
6. the service of documents.

In general, assistance under the Act may be obtained or provided in relation to any ‘criminal matter’, which is defined to mean a criminal investigation, criminal proceedings or an ancillary criminal matter (ie the restraining of dealing in, or the seizure, forfeiture or confiscation of, proceeds or instrumentalities of crime, or the obtaining, enforcement or satisfaction of a confiscation order).

The criminal matter must –

1. in the case of assistance sought by Singapore, relate to a Singapore offence, ie an offence in the First or Second Schedule to the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits ) Act (the CDTSCA); or
2. in the case of assistance sought by a foreign country, relate to a foreign offence, ie a drug offence or an offence that consists of or includes conduct which, if it had occurred in Singapore, would have constituted an offence under the Second Schedule to the CDTSCA.

Agri-Food and Veterinary Authority Act (A14/2000)

The Agri-Food and Veterinary Authority Act 2000 establishes and incorporates a new public corporation to be called the Agri-Food and Veterinary Authority and transfers to the corporation the functions, property, liabilities and employees of the existing Primary Production Department. The Act came into force on 1 April 2000.

Changes to Subsidiary Legislation

Central Provident Fund (Amendment of First Schedule) Notification 2000 (S156/2000)

The Central Provident Fund (Amendment of First Schedule) Notification 2000 implements the restoration in the employer’s CPF contribution rate from 10% to 12%.

In November 1998, the government had introduced cost cutting measures to counter the regional crisis. One of these measures was a reduction in the employer’s CPF contribution rate from 20% to 10% effective from 1 January 1999. The 10% reduction was comprised of 6% from the Ordinary Account and 4% from the Special Account. The CPF cut was to remain in place for two years after which the government would review the situation.

In November 1999 (only one year after the cut), the government reviewed the situation and restored the employer’s CPF contribution rate by 2% points to 12%. This 2% point restoration will be allocated fully to the Special Account. This change takes effect from 1 April 2000.

The government’s intention is to restore employer CPF contributions fully to 20%. If conditions are favourable, contributions will be restored fully within 5 years.

Income Tax (Singapore-Myanmar) (Avoidance of Double Taxation Agreement) Order 2000 (S161/2000)

The Government of the Republic of Singapore and the Government of the Union of Myanmar have entered into an Agreement for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income.

The taxes to which the agreement will apply are:

1. in Singapore, the income tax;
2. in Myanmar, the income tax imposed under the Income Tax Law 1974 (Law No 7 of 1974).

Pursuant to Article 10, the dividends paid by a company which is a resident of a Contracting State to a resident of the other Contracting State may be taxed in that other State. Such dividends may also be taxed in the country in which the company is resident, although, at present, both Contracting States do not impose tax on dividends in addition to the tax chargeable on the profits or income of a company.

In the future, if either or both Contracting States impose a tax on dividends, the tax so charged in the country of residence of the company shall not exceed:

1. 5% of the gross amount of the dividends if the beneficial owner is a company which owns at least 25% of shares of the company paying the dividends; or
2. 10% of the gross amount of the dividends in all other cases.

Interest arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State. Such interest may also be taxed in the State in which it arises but if the recipient is the beneficial owner of the interest, the tax so charged shall not exceed:

1. 8% of the gross amount of the interest if it is received by any bank or financial institution;
2. 10% of the gross amount of the interest in any other case.

Royalties arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State. Such royalties may also be taxed in the State in which it arises but if the beneficial owner of the royalties is a resident of the other Contracting State, the tax so charged shall not exceed:

1. 10% of the gross amount of the royalties in respect of payments of any kind received as a consideration for the use of, or the right to use, any patent, design or model, plan, secret formula or process, or for the use of, or the right to use, industrial, commercial or scientific equipment, or for information concerning industrial, commercial or scientific experience.
2. 15% of the gross amount of the royalties in any other case.

Futures Trading (Exempt Futures Market) Declaration 2000 (S185/2000)

The futures markets of the following futures exchanges have been exempted from the prohibition under section 3(1) of the Futures Trading Act with effect from 17 February 2000:

1. the Chicago Mercantile Exchange (‘CME’) that operates as a futures exchange organised under the laws of the United States of America;
2. the Societe Des Bourses Francaises (‘SBF’) that operates as a futures exchange organised under the laws of France; and
3. the New York Mercantile Exchange (‘NYMEX’) that operates as a futures exchange organised under the laws of the United States of America.

The exemption is subject to the requirements, conditions and restrictions imposed by the Monetary Authority of Singapore in the letters of approval issued in respect of the respective futures exchanges.

Section 3(1) of the Futures Trading Act provides for the general position that no person shall establish or assist in establishing or maintaining or hold himself out as providing or maintaining a futures market in Singapore that is not the futures market of a Futures Exchange that has been approved by the Monetary Authority of Singapore.

Telecommunications (Class Licences) Regulations 2000 (S187/2000)

The Telecommunications (Class Licences) Regulations 2000 provide for the class licensing of specified telecommunication systems and services. These Regulations are effective from 1 April 2000.

The following telecommunication systems and services are deemed to be class licensed:

1. store-and-retrieve value-added network services;
2. audiotex services;
3. resale of public switched telecommunication services;
4. public chain payphone services;
5. call-back and call re-origination services;
6. internet based voice and data services; and
7. International Calling Card (ICC) services.

Upon registration with the Info-communications Development Authority of Singapore and payment of the requisite fees, an operator shall be deemed to have been granted a class licence as may be appropriate to the type of specified telecommunications systems and services run by the operator.

The Telecommunications (Class Licences) Regulations (Cap 323, Reg 10) have been revoked. Previously, under the revoked regulations, only the following telecommunication systems and systems were deemed to be class licensed:

1. bulletin board services;
2. store-and-retrieve value-added network services;
3. audiotex services;
4. resale of public switched telecommunication services; and
5. public chain payphone services.

Any person who was granted a licence for bulletin board services under the revoked regulations shall be deemed to have been granted a class licence for store-and-retrieve value-added network services where no leased circuits are used.

Subordinate Courts Notification 2000 (S197/2000)

The President of the Republic of Singapore has appointed Court No 3 in the Supreme Court building as a Court House for the Magistrates’ Courts, with effect from 12 April 2000.

Goods and Services Tax Act (Amendment of Fourth Schedule) Order 2000 (S204/2000)

The Fourth Schedule to the Goods and Services Tax Act lists those transactions which are exempt supplies pursuant to section 22 of the Act. The Fourth Schedule has been amended by adding to the list of exempted supplies the transfer or assignment of the provision of the facility of instalment credit finance in a hire-purchase agreement. The change is effective from 15 April 2000.

Elizabeth Wong
Allen & Gledhill