SINGAPORE Law and Practice Contributed by: Tju Liang Chua and Ulanda Oon, Drew & Napier LLC
business from its account on the market that the DPTSP operates. 2.6 Non-Compliance In the case of Public Prosecutor v Lange Vivian [2021] SGMC 11, the accused was the first person prose- cuted under the PS Act for providing unlicensed DPT services. She received at least 13 fraudulent fund transfers totalling SGD3,350 and used the proceeds to purchase Bitcoin. Singapore applies the regulatory framework consist- ently and proportionately, targeting bad actors rather than the industry broadly, as the regulators do wish to continue to foster innovation. Ultimately, the regulato- ry breaches will often have a Singapore nexus before the regulators act. Even if the business is cross-border in nature, so long as there is a sufficient Singapore nexus, they may fall within regulator’s purview. See 2.2 Crypto-Asset Regulatory Frameworks . 3. Licensing and Set-Up Requirements 3.1 Licensing Requirements See 1.1.3 Regulation of Blockchain Technology and 2.2 Crypto-Asset Regulatory Frameworks for the activities that are regulated under the PS Act, SFA and FSMA, as well as their territorial scope. 3.2 Set-Up Requirements An entity that wishes to obtain a Payment Services Licence needs to be a Singapore-incorporated entity or a Singapore branch of a foreign corporation. At least one executive director of the applicant must be a Singapore citizen or permanent resident – or at least one executive director of the applicant is a Singapore employment pass holder, and at least one other direc- tor of the applicant is a Singapore citizen or perma- nent resident. Presently, the MAS has indicated that it generally does not anticipate issuing any licences under the FSMA, expecting that most entities should be applying for a licence under the PS Act instead. An SPI licence requires a minimum base capital of SGD100,000 while a MPI licence requires a minimum base capital of SGD250,000.
An entity wishing to obtain a CMS licence under the SFA must be a corporation, with a minimum of two directors – of whom one must be resident in Singa- pore. The chief executive officer will also need to have ten years of relevant experience and be resident in Singapore. The base capital requirements for a CMS licence range depending on the specific activity. 3.3 Change of Control The change in control requirements applicable to licensees under the PS Act and FSMA are generally similar to those applicable to CMS licensees under the SFA. A person cannot become a 20% controller of a licensee without applying for and obtaining approval from the MAS. This approval may be subject to conditions imposed by the MAS. For example, the MAS may restrict a person’s disposal or further acquisition of shares in the licensee or restrict a person’s voting power in the licensee. 3.4 Passporting Singapore does not operate a formal licence pass- porting regime akin to the EU’s single-market frame- work, where a licence obtained in one member state automatically confers the right to provide regulated services across all other member states. Generally, under the PS Act, any person, whether in Singapore or elsewhere, who is not a licensee or exempt PS provider under the PS Act, must not solicit the provision of PSs in Singapore or elsewhere. In determining whether the advertisement is made or issued to the public in Singapore, the MAS has pre- scribed certain non-exhaustive factors that it will con- sider under the Payment Services Regulations. These include whether: • the advertisement contains any information specifi- cally relevant to Singapore; • the advertisement is published in any newspaper, broadcast media, website or circular that is prin- 4. Cross-Border Services 4.1 Marketing
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