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Exemption from requirement to hold financial adviser’s licence for certain persons in respect of certain activities

Financial Advisers Regulations

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—(1) Subject to this regulation, the following persons are exempt from holding a financial adviser’s licence under section 20(1)(g) of the Act:(a)an approved headquarters company or approved Finance and Treasury Centre which carries on business involving the provision of all or any type of financial advisory service, but only to the extent that such provision of financial advisory service has been approved as a qualifying service in relation to that headquarters company or Finance and Treasury Centre under section 43D(2)(a) or 43E(2)(a) of the Income Tax Act 1947, as the case may be;(b)a corporation which provides all or any type of financial advisory service to any of its related corporations;(c)a person who provides all or any type of financial advisory service to any of its connected persons;(d)a person resident in Singapore who acts, whether directly or indirectly, as a financial adviser in giving advice in Singapore, either directly or through publications or writings or by issuing or promulgating research analyses or research reports, concerning any investment product (other than life policies), to not more than 30 accredited investors on any occasion; (e)a person who provides all or any type of financial advisory service to an institutional investor;(f)a person who acts, whether directly or indirectly, as a financial adviser in —(i)giving advice in Singapore, either directly or through publications or writings, and whether in electronic, print or other form; or(ii)issuing or promulgating research analyses or research reports, whether in electronic, print or other form,in respect of the person’s business of fund management that is carried out in accordance with paragraph 5(1)(j) or (k) of the Second Schedule to the Securities and Futures (Licensing and Conduct of Business) Regulations;(g)a person who carries on business of advising accredited investors or expert investors, either directly or through publications or writings or by issuing or promulgating research analyses or research reports, concerning OTC derivatives contracts the value of which is determined by reference to —(i)the value or amount of one or more commodities; or(ii)fluctuations in the values or amounts of one or more commodities;(h)an approved global trading company which carries on business of advising others, either directly or through publications or writings or by issuing or promulgating research analyses or research reports, concerning OTC derivatives contracts the value of which is determined by reference to —(i)the value or amount of one or more commodities; or(ii)fluctuations in the values or amounts of one or more commodities.(1A) For the purposes of paragraph (1)(d), where a person acts as a financial adviser in giving advice in Singapore in the manner specified in that paragraph in the period from 8 October 2018 to 7 April 2019 (both dates inclusive) to an ex-accredited investor who is the person’s existing customer, that ex-accredited investor is treated as an accredited investor.(1B) For the purposes of paragraph (1)(g), where a person carries on business of advising any ex-accredited investor who is an existing customer of the person in the manner mentioned in that paragraph and in the period from 8 October 2018 to 7 April 2019 (both dates inclusive), the person is treated as carrying on the business of advising accredited investors in that manner.(2) A person who is exempt under paragraph (1)(a), (b) or (c) may, in ascertaining the number of accredited investors for the purpose of exemption under paragraph (1)(d), exclude those persons on behalf of whom he provides all or any type of financial advisory service under paragraph (1)(a), (b) or (c).(3) [Deleted by S 639/2024 wef 01/08/2024](3A) A person otherwise exempted under paragraph (1)(d) shall not be, or shall cease to be, so exempt if —(a)the person has not commenced business in accordance with paragraph (1)(d) within 6 months from the date of commencement of business as specified in the notice that the person has lodged with the Authority in accordance with regulation 37(2); or(b)the person has ceased to carry on business in accordance with paragraph (1)(d), and has not resumed business in the same regulated activity in accordance with that paragraph within a continuous period of 6 months from the date of cessation.(3B) For the purposes of section 20(9) of the Act, a person otherwise exempted under paragraph (1)(d) must notify the Authority of the following facts, immediately after becoming aware of that fact:(a)that any development (including any development in relation to any associate of the person or any other entity treated as part of the person’s group of companies according to the accounting standards applicable to the person) has occurred or is likely to occur which the person has reasonable grounds to believe has materially and adversely affected, or is likely to materially and adversely affect —(i)the financial soundness or reputation of the person;(ii)the person’s ability to carry on business in any type of financial advisory service to which its exemption relates; or(iii)such other matters as the Authority may specify by notice in writing;(b)where the person is an entity —(i)that the person’s chief executive officer or director is, in accordance with the Guidelines on Fit and Proper Criteria, no longer fit and proper to hold that office or appointment;(ii)that a substantial shareholder of the person or a person mentioned in regulation 14A(1)(b)(iii)(C) is, in accordance with the Guidelines on Fit and Proper Criteria, no longer fit and proper to be a substantial shareholder of the person or to control such power or hold such shares or share of ownership as mentioned in that regulation, as the case may be; or(iii)that the person is not likely to be able to conduct its business prudently or to comply with the provisions of the Act and directions made thereunder, having regard to the likely influence over the person of a substantial shareholder of the person or a person mentioned in regulation 14A(1)(b)(iii)(C).(4) Section 42 of the Act shall, with the necessary modifications, apply to the persons referred to in paragraph (1).(5) A person otherwise exempt under paragraph (1) shall not be, or shall cease to be, so exempt if he also carries on a business of providing any financial advisory service other than in accordance with paragraph (1)(a), (b), (c), (d), (e), (f), (g) or (h).(6) A person referred to in paragraph (1)(c), (d), (e), (f) or (g) who is an individual shall not be, or shall cease to be, exempt from holding a financial adviser’s licence under section 20(1)(g) of the Act if —(a)he is or becomes an employee or representative of a licensed financial adviser or an exempt financial adviser;(b)he has been adjudged a bankrupt, whether in Singapore or elsewhere; or(c)he has been convicted —(i)whether in Singapore or elsewhere, of any offence in connection with the promotion, formation or management of a corporation or involving fraud or dishonesty, or the conviction for which involved a finding that he had acted fraudulently or dishonestly;(ii)of any offence under the Companies Act 1967 involving lack of diligence, or the conviction for which involved a finding that he had acted with a lack of diligence, in the discharge of his duties as a director of a corporation;(iii)of any offence under the Act; or(iv)of any offence under the Banking Act 1970, the Finance Companies Act 1967, the Financial Services and Markets Act 2022, the Insurance Act 1966, the Monetary Authority of Singapore Act 1970, the Payment Services Act 2019, the Penal Code 1871 or the Securities and Futures Act 2001.(7) A person referred to in paragraph (1)(a), (b), (c), (d), (e), (f), (g) or (h) which is a corporation shall not be, or shall cease to be, exempt from holding a financial adviser’s licence under section 20(1)(g) of the Act if —(a)the corporation or any of its substantial shareholders is in the course of being wound up or otherwise dissolved, whether in Singapore or elsewhere;(b)a receiver, receiver and manager, judicial manager, or such other person having the powers and duties of a receiver, receiver and manager or judicial manager, has been appointed, whether in Singapore or elsewhere, in relation to, or in respect of any property of, the corporation or any of its substantial shareholders;(c)the corporation or any of its substantial shareholders has, whether in Singapore or elsewhere, entered into a compromise or scheme of arrangement with his or its creditors, being a compromise or scheme of arrangement that is still in operation;(d)an enforcement order against the corporation or any of its substantial shareholders in respect of a judgment debt has been returned unsatisfied in whole or in part; or(e)the corporation or any of its substantial shareholders has been convicted —(i)whether in Singapore or elsewhere, of any offence in connection with the promotion, formation or management of a corporation or involving fraud or dishonesty, or the conviction for which involved a finding that he or it had acted fraudulently or dishonestly;(ii)of any offence under the Companies Act 1967 involving lack of diligence, or the conviction for which involved a finding that he had acted with a lack of diligence, in the discharge of his duties as a director of a corporation;(iii)of any offence under the Act; or (iv)of any offence under the Banking Act 1970, the Finance Companies Act 1967, the Financial Services and Markets Act 2022, the Insurance Act 1966, the Monetary Authority of Singapore Act 1970, the Payment Services Act 2019, the Penal Code 1871 or the Securities and Futures Act 2001.(8) In this regulation —“approved Finance and Treasury Centre” means an approved Finance and Treasury Centre under section 43E of the Income Tax Act 1947;“approved global trading company” means an approved global trading company under section 43I of the Income Tax Act 1947;“approved headquarters company” means an approved headquarters company under section 43D of the Income Tax Act 1947;“fund management” has the same meaning as in section 2(1) of the Securities and Futures Act 2001;[Deleted by S 639/2024 wef 01/08/2024]“resident in Singapore” has the same meaning as in section 2(1) of the Income Tax Act 1947.

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