Singapore legislation
Section 36
Section 36
Recommendations by licensed financial advisers
(1)
A licensed financial adviser must not make a recommendation with respect to any investment product to a person who may reasonably be expected to rely on the recommendation if the licensed financial adviser does not have a reasonable basis for making the recommendation to the person.
(2)
For the purposes of subsection (1), a licensed financial adviser does not have a reasonable basis for making a recommendation to a person unless —
the licensed financial adviser has, for the purposes of ascertaining that the recommendation is appropriate, having regard to the information possessed by the licensed financial adviser concerning the investment objectives, financial situation and particular needs of the person, given such consideration to, and conducted such investigation of, the subject matter of the recommendation as is reasonable in all the circumstances; and
the recommendation is based on the consideration and investigation mentioned in paragraph (a).
(3)
Where —
a licensed financial adviser, in making a recommendation to a person, contravenes subsection (1);
the person, in reliance on the recommendation, does a particular act, or refrains from doing a particular act;
it is reasonable, having regard to the recommendation and all other relevant circumstances, for the person to do that act, or to refrain from doing that act (as the case may be) in reliance on the recommendation; and
the person suffers loss or damage as a result of doing that act, or refraining from doing that act (as the case may be),then, without affecting any other remedy available to that person, the licensed financial adviser is liable to pay damages to that person in respect of that loss or damage.
(4)
In this section, a reference to the making of a recommendation is a reference to the making of a recommendation expressly or by implication.
(5)
This section does not apply to any licensed financial adviser or class of licensed financial advisers in such circumstances or under such conditions as may be prescribed.[27