Legislation

New Acts

Housing and Development (Amendment) Act 2002 (A31/2002)

The Housing and Development (Amendment) Act 2002 will come into force on 1 January 2003.

Following the commencement of the Housing and Development (Amendment) Act 2002, the Housing and Development Act (Cap 129) will be amended for various purposes including:

• amending s 51 to allow an approved mortgagee or statutory chargee to attach a Housing and Development Board (‘HDB’) flat in exercise of its powers under the mortgage or charge, as the case may be. Section 51 will be amended to provide two exceptions to the general prohibition against attaching HDB flats by court order. The two exceptions are where the application to the court for attachment of an HDB flat is made by an approved mortgagee or a statutory chargee; and
• amending s 48A to provide that both the HDB and lessees will be discharged from the restrictive covenant in leases that prohibit the use of HDB flats for any trade, business, manufacture or commercial purpose, regardless of the building the flat is situated in. This is to further facilitate implementation of the Technopreneur Home Office Scheme. Section 48A will also be amended to provide that a lessee must obtain the HDB’s prior written approval before using his HDB flat for a purpose other than that permitted by the lease. This is to enable the HDB to control the use of HDB flats for purposes consistent with the Technopreneur Home Office Scheme.

Property Tax (Amendment) Act 2002 (A33/2002)

The Property Tax (Amendment) Act 2002 will come into force on 1 January 2003.

The Property Tax Act (Cap 254) will be amended for the following main purposes:

• to change the payment of property tax from twice a year to once a year in January;
• to abolish the public inspection of and objection to the Valuation List for the following year in the month of August;
• to allow taxpayers to lodge objections to the annual values of their properties at any time during the current year;
• to allow the Comptroller to impose a penalty not exceeding 5% of the unpaid tax immediately upon the expiration of the time period stipulated for payment and to dispense with the need to issue a notice of demand before the penalty can be imposed; and
• to establish a Street and Building Names Board to determine or alter the name of any building, estate or street.

Media Development Authority of Singapore Act 2002 (A34/2002)

The Media Development Authority of Singapore Act 2002 comes into operation on 1 January 2003.

This new Act establishes and incorporates a new public corporation to be called the Media Development Authority of Singapore, and effects the transfer to the Media Development Authority the functions, property, liabilities and employees of the Films and Publications Department in the Ministry of Information, Communications and the Arts, the Singapore Broadcasting Authority and the Singapore Film Commission.

Central Provident Fund (Amendment) Act 2002 (A36/2002)

The Central Provident Fund (Amendment) Act 2002 will largely come into force on 1 January 2003. The changes which will come into force on 1 January 2003 are as follows:

• Amendment of s 13B (relating to voluntary Central Provident Fund (‘CPF’) contributions):
  

1. to disallow voluntary CPF contributions by any person who is not a citizen or permanent resident of Singapore;
2. to limit voluntary contributions, including voluntary contributions paid by employers, to S$28,800 per year; and
3. to empower the Minister to prescribe another amount in place of S$28,800.
   

Read with the Central Provident Fund (Exemption — Foreign Employees) Order 2002 (S523/2002) (the ‘Order’), the effect of the amendment to s 13B is to preclude foreign employees altogether from the CPF scheme. The Order provides that, with effect from 1 October 2002, s 7 of the Central Provident Fund Act (Cap 36) shall not apply to an employer of a foreign employee who is neither a citizen nor permanent resident of Singapore. Section 7 provides for the obligation of employers to contribute to the Central Provident Fund.

• Amendment to s 15(3) to shorten the three year interval for withdrawal of CPF contributions after the age of 55 to one year or such other interval as the Minister may direct.
• Amendment to s 15(12) to clarify that a bank is prohibited from setting-off any debt owed to the bank by a member against the CPF minimum sum deposited by the member in any account with that bank.
• Insertion of a new s 21B to create an automatic charge on an HDB flat in favour of the Board when a member withdraws CPF funds to:
  

1. finance or re-finance the purchase of the HDB flat;
2. pay any improvement contribution for upgrading works carried out on the HDB flat under Part IVA of the Housing and Development Act; or
3. pay any other costs incurred in connection with those purposes.
   

The new s 21B will apply in respect of any such withdrawal whether made before, on or after 1 January 2003. The charge on the HDB flat is constituted immediately upon such withdrawal. The charge confers on the Board the power of sale and all other powers relating or incidental thereto notwithstanding that it is not registered under the Land Titles Act (Cap 157).

The changes which are ‘not yet in force’ relate to the use of the common seal of the Central Provident Fund Board and the appointment of a chief executive officer of the Board.

Payment and Settlement Systems (Finality and Netting) Act (A39/2002)

The Payment and Settlement Systems (Finality and Netting) Act 2002 is operative from 9 December 2002. The Act protects payment and settlement systems from disruptions that may lead to risks to the financial system. Proper protection of such systems is critical to the effective functioning of the financial system. The Act provides a conducive environment for the operation of stable and secure payment and settlement systems by empowering the Monetary Authority of Singapore (‘MAS’) to designate payment and settlement systems. These designated systems will be exempted from the application of various laws, including the law of insolvency.

The Act also provides the legal certainty that will enable Singapore banks to participate in the Continuous Linked Settlement (‘CLS’) system, which is a global system for the settlement of foreign currency transactions, and eventually pave the way for the Singapore dollar to be included within the CLS system.

The Payment and Settlement Systems (Finality and Netting) Act 2002 repeals s 59A of the Banking Act (Cap 19). Section 59A provided for the establishment of a Clearing House.

At the same time, the Monetary Authority of Singapore Act (Cap 186) is amended with the insertion of a new s 29A. Section 29A empowers the MAS to establish and operate one or more real-time gross settlement systems for the transfer of funds, settlement of payment obligations and the transfer and settlement of book-entry securities and instruments between or among participants approved by the MAS. The MAS may enter into agreements with participants of a settlement system and issue to the participants in writing rules for the operation of the settlement system and such rules shall not be deemed to be subsidiary legislation.

Rapid Transit Systems (Amendment) Act 2002 (A41/2002)

The Rapid Transit Systems (Amendment) Act 2002 is operative from 13 December 2002.

Following the commencement of the Rapid Transit Systems (Amendment) Act 2002, the following changes have been made to the principal Act.

Section 15 is amended to empower the Land Transport Authority of Singapore (the ‘Authority’) to impose conditions relating to the following matters when granting a licence to operate any rapid transit system:

• the approval by the Authority of the appointment, re-appointment or removal of any person as the chairman or as a director of the licensee;
• the control and restriction on the creation, holding or disposal of shares in the licensee or its shareholders, or of interests in the undertaking of the licensee or any part thereof;
• the restriction on the carrying on by the licensee of any trade or business not related to the activity which the licensee is authorised by its licence to carry on; and
• the standards of performance to be complied by the licensee in the maintenance or operation of the rapid transit system or the provision of rapid transit system services.

Three new sections have been inserted, namely, ss 15A, 15B and 15C.

The new s 15A empowers the Authority to add, delete or modify the terms or conditions of a licence granted under s 13 and provides for the procedure by which such terms or conditions may be added, deleted or modified.

The new s 15B empowers the Authority to issue or approve and from time to time modify codes of practice in connection with:

• the maintenance or operation of rapid transit systems and any equipment relating thereto;
• the provision of rapid transit system services;
• the conduct of licensees; and
• the safety of persons who use or who are engaged in any work on the rapid transit system.
  

The new s 15C empowers the Authority to give directions to be observed by licensees for or in respect of the following matters:

• the extent, hours and general level of the services to be provided by licensees;
• the extension of the operating hours of the services provided by the licensees;
• the maintenance and operation of the rapid transit system; and
• any other matters affecting the interests of the public in connection with the services provided by licensees.
  

Sections 16 and 17 have been repealed and re-enacted.

The new s 16 provides for the measures by which the Authority may deal with errant licensees and spells out the circumstances under which, and the procedure by which, the Authority may:

1. suspend or cancel the licence of a licensee;
2. forfeit the whole or any part of any security deposited by a licensee; or
3. require a licensee to pay a financial penalty not exceeding S$1m.
   

The new s 17 provides for an appeal to the Minister from:

1. any licence condition imposed by the Authority under s 15(g) or 15(h);
2. any addition, deletion or modification of the terms or conditions of its licence under s 15A;
3. any code of practice as issued, approved or modified by the Authority under s 15B;
4. any direction given by the Authority under s 15C;
5. any decision made by the Authority under sub-s 16(1)(i), (ii) or (iii); or
6. the refusal of the Authority to renew its licence.

New Subsidiary Legislation

Payment and Settlement Systems (Finality and Netting) (Designated System) Order 2002 (S620/2002)

With effect from 9 December 2002, the CLS system, being a system for settling payment obligations and entitlements arising from foreign exchange transactions and operated by CLS Bank International, has been named a designated system for purposes of the Payment and Settlement Systems (Finality and Netting) Act.

Companies (Amendment) Act (Transitional Provisions) Regulations 2002 (S636/2002)

Sections 201, 202, 203, 207, 209A and 373 of the Companies Act (Cap 50) as amended by the Companies (Amendment) Act 2002, and s 61 of the Companies (Amendment) Act 2002 (pertaining to repeal of Ninth Schedule) shall not apply to any accounts to be submitted by a company in respect of a ‘financial year which commences before 1 January 2003’, and ss 201, 202, 203, 207, 209A and 373 of and the Ninth Schedule to the Companies Act (Cap 50) in force immediately before that date shall continue to apply to such accounts.

Central Provident Fund (Approved Mortgagees) Notification 2002 (S639/2002)

With effect from 1 January 2003, the following entities are approved as mortgagees for the purposes of the Central Provident Fund Act (Cap 36):

• Any bank licensed under the Banking Act (Cap 19).
• Any finance company licensed under the Finance Companies Act (Cap 108).
• Any direct insurer registered under the Insurance Act (Cap 142).
• The Minister for Finance incorporated under the Minister for Finance (Incorporation) Act (Cap 183).
• Any merchant bank approved as a financial institution under the Monetary Authority of Singapore Act (Cap 186).
• Any statutory body established by or constituted under any Act.
  

The Central Provident Fund (Approved Mortgagees) Notification (N 3) is cancelled.

Companies (Accounting Standards) Regulations 2002 (S644/2002)

The Companies (Accounting Standards) Regulations 2002, which will come into force on 1 January 2003, set out the Accounting Standards applicable to companies. These Accounting Standards are known as Financial Reporting Standards.

The Companies (Accounting Standards) Regulations 2002 are made by the Accounting Standards Committee (known as the Council on Corporate Disclosure and Governance) with the approval of the Minister for Finance.

Elizabeth Wong
Allen and Gledhill