Legislation

Central Provident Fund (Amendment) Bill 2006 (B6/2006)

The Central Provident Fund (Amendment) Bill 2006 was introduced in Parliament on 13 February 2006 and passed on 3 April 2006.

Among other things, the Bill will amend the Central Provident Fund Act for the following purposes:

1   to increase the number of grounds on which a member may withdraw his CPF savings under s 15(2). New grounds include situations where the member is suffering from a medical condition leading to a severely impaired life expectancy, or where he is suffering from a terminal illness or disease;

2   to allow the amount in a deceased member’s medisave account to be used for the payment of expenses for medical treatment received by the member;

3   to clarify the ambit of the prohibitions and protection under s 24 (protection of benefits from assignment, transfer, attachment, sequestration, set-off); and

4   to clarify how the amount payable on the death of a member under s 25(2) (no person nominated) should be disposed of.

National Research Fund Bill 2006 (B10/2006)

The National Research Fund Bill 2006 was read a second time and passed in Parliament on 3 April 2006. The Bill was first introduced on 27 February 2006.

The Bill will establish a new government fund to be called the National Research Fund to facilitate the better accounting and management of public moneys for research and development activities. The Bill also makes consequential amendments to the Agency for Science, Technology and Research Act and the Standards, Productivity and Innovation Board Act.

Electricity (Amendment) Act 2006

The Electricity (Amendment) Act 2006 (the ‘Amendment Act’) was gazetted on 26 April 2006 and came into force on 1 May 2006.

The Amendment Act was introduced as the Electricity (Amendment) Bill in Parliament on 27 February 2006 and was passed on 3 April 2006. The Amendment Act amends the Electricity Act (the ‘Act’) principally to enhance the Energy Market Authority’s (‘EMA’) regulation of the transmission of electricity. In January/February 2006, the EMA conducted a public consultation requesting feedback on proposed amendments to the Act.

Key amendments to be effected by the Amendment Act include the following:

1   EMA to license SP PowerGrid Ltd (‘SPPG’), which manages the grid operations for and on behalf of SP PowerAssets Ltd (‘SPPA’), the transmission licensee which owns the grid assets;

2   New Part IVA to the Act, which will allow EMA to control ownership changes in electricity licensees and other entities involved in the transmission business. There will be a requirement for EMA’s approval for the appointment of persons to key management positions in electricity licensees involved in the transmission business;

3   EMA will have wider scope of power to obtain information and documents and to retain any document or information without payment;

4   Strengthened penalty framework for effective regulation of the electricity industry. For instance, there will be an additional fine of up to S$12,500 for each day an offence of carrying out a licensable activity without an electricity licence continues after conviction;

 5  The Energy Market Company will be required to modify the market rules governing the electricity market in accordance with EMA’s directions and there will be financial penalties for breach of market rules; and

6   An electricity licensee must first seek the approval of EMA to carry out any relevant work in relation to an electric line, electrical plant or other specified matter which is owned or operated by another electricity licensee.

Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (Amendment of Second Schedule) Order 2006

Pursuant to the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (Amendment of Second Schedule) Order 2006 (S254/2006), the list of offences included as serious offences under the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (the ‘Act’) is expanded to include, inter alia, insider trading and market misconduct offences under the Securities and Futures Act (the ‘SFA’). The amendment will effectively make the laundering of proceeds or benefits gained from insider trading and the market misconduct offences under the SFA an offence.

 The Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (Amendment of Second Schedule) Order 2006 is operative since 8 May 2006.

Banking (Amendment) Regulations 2006

Section 4A of the Banking Act (the ‘Act’) imposes restrictions on the carrying on of deposit-taking business and the soliciting of deposits in Singapore.

Section 4A(1) provides that no person shall, in the course of carrying on a deposit-taking business (whether in Singapore or elsewhere), accept in Singapore any deposit from any person in Singapore.

Section 4A(2) provides that no person shall, whether in Singapore or elsewhere, offer or invite or issue any advertisement containing any offer or invitation to the public in Singapore: (a) to make any deposit, whether in Singapore or elsewhere; or (b) to enter into any agreement to make any deposit, whether in Singapore or elsewhere,

where such deposit is to be made with any person in the course of the carrying on (whether in Singapore or elsewhere) of a deposit-taking business by 
that person.

Pursuant to the Banking (Amendment) Regulations 2006 (S170/2006) (the ‘Amendment Regulations’), the following exemptions took place with effect from 24 March 2006:

1   Section 4A (1) of the Act will not apply to any foreign entity in respect of any deposit accepted in Singapore, on behalf of the foreign entity by its agent bank, from any accredited investor in Singapore.

2   Section 4A (2) of the Act will not apply to any agent bank of a foreign entity in respect of: (a) any offer or invitation to make any deposit, or to enter or offer to enter into any agreement to make any deposit, with the foreign entity; or (b) any advertisement containing such offer or invitation, where such offer, invitation or advertisement is made or issued to accredited investors in Singapore by the agent bank on behalf of the foreign entity.

An agent bank which accepts or solicits deposits from an accredited investor on behalf of a foreign entity in the circumstances specified in paragraph (1) or (2) is obliged to provide specified information to the accredited investor, in writing, when soliciting or accepting any deposit from the accredited investor.

The term ‘accredited investor’ is defined in the Amendment Regulations.

Elizabeth Wong

Allen & Gledhill