SINGAPORE Law and Practice Contributed by: Renu Menon, May Ng, Blossom Hing, SC and Ong Ken Loon, Drew & Napier LLC
3.11 Disclosure Requirements Financial contract disclosure requirements vary depending on the type of financial product, the intended audience and the legal structure governing the transaction. The SFA sets the baseline for disclosures for financial products such as bonds, securities, and other invest- ment instruments. Under the SFA, issuers offering securities to the public must provide a prospectus with detailed information about the securities, the issuer, and any associated risks. There are exemptions which apply to the requirement for such prospectus to be registered with the MAS. Disclosure requirements also depend on whether the securities are publicly listed or privately offered. The SGX Listing Manual requires issuers to disclose mate- rial information affecting the price of listed debt secu- rities and regularly update investors on redemptions or interest payments. Issuers must also provide imme- diate updates on events impacting security values or investor decisions, and non-compliance may lead to disciplinary actions by SGX. Separately, financial institutions must adhere to MAS Notices, such as MAS Notice 628 on securitisation disclosures, which outline post-transaction reporting and investor transparency requirements. The Financial Reporting Standards (SB-FRS 107) also require dis- closure of financial instruments’ risk exposure, such as credit/liquidity risks, ensuring entities disclose qualitative and quantitative risk information relevant to the provision of financial contracts. Lastly, compliance with AML/CFT obligations adds further disclosure responsibilities, especially when dealing with higher-risk transactions.
There is no prescribed form or length of such loan documentation to satisfy the regulatory requirement in the Code, but the practice is to use a full form docu- ment (such as a facility agreement). There is also no requirement for such loan documentation to be pub- licly filed in Singapore. However, the acquirer/offeror may be required to provide evidence to the SIC to
demonstrate compliance with the Code. 3.9 Recent Legal and Commercial Developments
Recent legal and commercial developments in Sin- gapore have influenced legal documentation, espe- cially in areas like ESG and sustainability-linked lending. Key developments include the introduction of the Guidance for Leveraging the Singapore-Asia Taxonomy in Green and Transition Financing from the SFFA (see 1. Loan Market Overview ), with the inten- tion of promoting broader adoption of the SAT and strengthen sustainable finance practices in the region. In March 2025, the Asia Pacific Loan Market Associa- tion, the Loan Market Association and the Loan Syn- dications and Trading Association jointly published updated versions of the Green Loan Principles, the Social Loan Principles and the Sustainability-Linked Loan Principles. The documents were last updated in 2023. These updates, accompanied by updated guid- ance, reflect current market consensus in the global sustainable finance markets. 3.10 Usury Laws Pursuant to Section 36 (1) of the Moneylenders Act and rule 11 (1) of the Moneylenders Rules 2009, the maximum rate of interest that may be charged on a loan granted to an individual is 4% per month. There are no explicit usury laws that cap the amount of interest that can be charged to an entity. However, to protect entities from excessive or unconscionable interest rates, Section 23 (2) of the Moneylenders Act requires licensing for businesses involved in lending and empowers courts to scrutinise loan agreements for high interest rates, which may be deemed “harsh and unconscionable or substantially unfair”. Here, the court has discretion to adjust terms or nullify the loan if necessary.
4. Tax 4.1 Withholding Tax No Tax on Principal
Singapore imposes tax only on income and not on capital. Accordingly, the receipt of repayment of prin- cipal on a loan is not taxed in Singapore.
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