SINGAPORE Law and Practice Contributed by: Doos Choi, Pierre Dzakpasu, Janelene Chen and Pieter de Ridder, Mayer Brown
2.3 Restrictions on Foreign Investments There are no specific restrictions on such invest - ment. 2.4 Compliance and Reporting Requirements If a private credit lender is regulated by the MAS, certain ongoing reporting requirements will apply. For example, fund managers licensed under the SFA and moneylenders licensed under the MLA are subject to certain reporting require - ments. Except for the above, there are no compliance and reporting requirements which apply specifi - cally to private credit providers in Singapore (for the purposes of this exercise, requirements that may apply to private funds generally, regardless of whether private credit, private equity, etc, and whether any financial reporting and tax filings apply to businesses generally, will not be taken into account). 2.5 Club Lending and Antitrust We are not aware of any recent antitrust cases in Singapore where the principal antitrust regu - lator, the Competition and Consumer Commis - sion, has expressed any particular concerns with respect to the private credit market. 3. Structuring and Documentation 3.1 Common Structures Given that so many private credit investments in Asia are bespoke arrangements to suit a par - ticular need and will have to be sensitised to local laws and regulations (such as cross-bor - der foreign-exchange controls and limitations on cross-border guarantees and security), it is difficult to generalise and comment on “com - mon” structures. Indeed, with so many deals
being cross-border in nature, one of the princi - pal external factors which drives changes to the structuring of private credit deals is the evolving legal and regulatory landscape – eg, whether local laws permit cross-border property mort - gages to be granted in favour of a foreign lender; revisions to foreign-exchange rules which may be tightened or loosened according to the views of the current administration, etc. Looking at a purely domestic Singapore sen - ior secured situation, the structure will appear very similar to that adopted by commercial bank lenders, although, for example, a private credit fund may offer higher LTVs than a commercial bank lender may be prepared for (in the real estate context) or permitted to accept. Investments in the form of junior debt may be in the form of holdco loans without any direct credit support from the underlying assets or business such that intercreditor arrangements (ICAs) with underlying senior debt tranches are not always required. Most private credit transactions are term loan facilities and may be delayed-draw, depending on the circumstances. Revolving credit facili - ties are unlikely to be provided by private credit funds, although some structures have enabled capital to be recycled under certain circum - stances (although they are not typical working capital-style revolving credit facilities). 3.2 Key Documentation The key documentation involved in a private credit transaction is similar to that of a bank loan. For example, for a senior secured transaction, there will be a facility agreement incorporating any guarantees to be provided (sometimes there will be a separate local law-governed guaran - tee); the security documents will vary depending
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