Singapore legislation
Regulation 24A
Regulation 24A
Margin requirements for contracts for differences and spot foreign exchange contracts for the purposes of leveraged foreign exchange trading
Subregulation 1
Subject to paragraph (2), a holder of a licence dealing in contracts for differences must obtain from its customers margin that meets the minimum margin requirements in respect of each contract for differences that the holder enters into with a customer —
before 8 October 2018 and which remains in force on or after that date; or
on or after 8 October 2018.
Subregulation 2
A holder of a licence that was carrying on business in dealing in foreign exchange contracts for differences immediately before 8 October 2018 need not comply with paragraph (1) but must on and after 8 October 2019 obtain from its customers margin that meets the minimum margin requirements in respect of each foreign exchange contract for differences that the holder enters into with a customer —
before 8 October 2019 and which remains in force on or after that date; or
on or after 8 October 2019.
Subregulation 3
Subject to paragraph (4), a holder of a licence dealing in spot foreign exchange contracts for the purpose of leveraged exchange trading must obtain from its customers margin that meets the minimum margin requirements in respect of each spot foreign exchange contract for the purpose of leveraged exchange trading that it enters into with its customers.
Subregulation 4
A holder of a licence that was carrying on business in dealing in spot foreign exchange contracts for the purpose of leveraged exchange trading immediately before 8 October 2018 need not comply with paragraph (3) but must on and after 8 October 2019 obtain from its customers margin that meets the minimum margin requirements in respect of each spot foreign exchange contract for the purpose of leveraged exchange trading that the holder enters into with a customer —
before 8 October 2019 and which remains in force on or after that date; or
on or after 8 October 2019.
Subregulation 5
The minimum margin requirements required under paragraphs (1) to (4) must be in the form of acceptable collateral.
Subregulation 6
A holder of a licence that is required to obtain margin from a customer under paragraph (1), (2), (3) or (4) must, if the current market value of acceptable collateral in the customer’s trading account falls below the minimum margin requirements, contact that customer immediately and inform the customer to provide additional acceptable collateral to make good the shortfall in value within 2 business days after being so informed by the holder of the licence.
Subregulation 7
In this regulation —
Definition
“acceptable collateral” has the same meaning as in regulation 24(6);
Definition
“contract for differences” means any over-the-counter derivatives contract which is traded on a margin basis, the purpose or purported purpose of which is to secure a profit or avoid a loss by reference to fluctuations in —
the value or amount of one or more underlying things; (b)the value or price of any group of underlying things; or (c)an index of one or more underlying things,and which does not involve the actual taking or physical delivery of any of the underlying things;
Definition
“minimum margin requirements” means the minimum margin requirements specified in Table 18 of the Fourth Schedule;
Definition
“over-the-counter derivatives contract” means a derivatives contract that is not an exchange-traded derivatives contract;
Definition
“trading account”, in relation to a customer, means an account of the customer through which a holder of a licence enters or has entered into any transaction in —
any contract for differences; or (b)any spot foreign exchange contracts for the purposes of leveraged foreign exchange trading.