SINGAPORE Law and Practice Contributed by: Renu Menon, May Ng, Blossom Hing, SC and Ong Ken Loon, Drew & Napier LLC
tional and renewable energy projects remains strong. Singapore has expanded its support mechanisms for green financing under the Enterprise Financing Scheme – Green (EFS-Green), introduced by Enter- prise Singapore. After October 2021, EFS-Green remains a key initiative to enable better access to green financing for enterprises that are project devel- opers, system integrators and technology & solution enablers which develop enabling technologies and solutions to reduce waste, resource use or green- house gas emissions. As part of the Singapore Budget 2024, the scheme was expanded to provide support for enterprises that adopt technologies and solutions that are green or transitional. Enterprise Singapore will provide a 70% risk-share to spur lending from par- ticipating financial institutions. Applications are open until 31 March 2026. Under Singapore law, no person may carry on or hold him- or her-self out in any way as carrying on the busi- ness of a moneylender without holding the requisite moneylenders’ licence, unless he/she is an exempt or excluded moneylender. The relevant legislation, the Moneylenders Act 2008 (Moneylenders Act), provides that any person, other than an excluded moneylender, who lends a sum of money in consideration of a larger sum being repaid (ie, charges interest) shall be pre- sumed, until the contrary is proved, to be a money- lender. 2. Authorisation 2.1 Providing Financing to a Company Under the Moneylenders Act, an excluded money- lender includes, amongst others, any person licensed, approved, registered or otherwise regulated by the MAS under any other written law. This would include banks or finance companies which are required to hold a valid licence to be granted by the MAS under the Banking Act 1970 and the Finance Companies Act 1967 respectively for the conduct of banking business and financing business in Singapore. Such excluded moneylender also includes any person who lends money solely to corporations or who lends money solely to accredited investors within the meaning of Section 4A of the Securities and Futures Act 2001. Hence, a non-bank lender would fall outside the
licensing regime under the Moneylenders Act so long as it falls within the meaning of an “excluded money- lender” under the act. 3. Structuring and Documentation 3.1 Restrictions on Foreign Lenders Providing Loans Foreign lenders may provide loans in Singapore only if they are licensed under the Moneylenders Act, unless they are exempt or excluded moneylenders – see 2.1 Providing Financing to a Company . 3.2 Restrictions on Foreign Lenders Receiving Security There are generally no restrictions on foreign lend- ers receiving security or guarantees from a Singapore entity. 3.3 Restrictions and Controls on Foreign Currency Exchange There are currently no exchange controls in Singa- pore. 3.4 Restrictions on the Borrower’s Use of Proceeds In Singapore, borrowers are generally free to use pro- ceeds from loans or debt securities if their use com- plies with the terms agreed with the lender under the lending documents and certain relevant regulatory requirements (depending on the type of loan, borrower and intended use of funds). A non-exhaustive list of such regulatory requirements is detailed below. • Debt securities – the Securities and Futures Act (SFA) governs offers to the public, mandating a prospectus registered with the MAS unless exemp- tions apply, such as offerings to institutional inves- tors or accredited investors, subject to certain con- ditions, under Sections 274 and/or 275 of the SFA. This framework allows issuers flexibility regarding the use of proceeds without direct restrictions, provided they adhere to disclosure requirements when marketing debt instruments to specified investors. Additionally, the Singapore Exchange (SGX) mandates disclosure of any material informa- tion impacting securities’ prices, protecting inves-
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