On 22/05/2013,
you requested for the version in force on 22/05/2013
incorporating all amendments published on or before 22/05/2013.
The closest version currently available is that of 15/07/2011.
PART II
LICENSING OF FINANCE COMPANIES
3.
—(1) No financing business shall be transacted in Singapore except by a public company that is in possession of a valid licence granted by the Authority authorising it to conduct financing business in accordance with the provisions of this Act.
(2) Any person who contravenes subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $20,000 or to imprisonment for a term not exceeding 3 years or to both.
[33/84]
4.
—(1) No person or body of persons, whether incorporated or not, other than a finance company licensed under this Act shall, without the consent of the Authority, use the words “finance company” or any of its derivatives in any language, or any other words indicating that it transacts financing business, in the name, description or title under which that person or body of persons is transacting business in Singapore or make or continue to make any representations to that effect in any bill-head, letter-paper, notice, advertisement or in any other manner.
(2) Nothing in this section shall prohibit an association of finance companies formed for the protection of common interests from using the words “finance company” or any of its derivatives in any language as part of its name or description of its activities.
5.
—(1) Whenever the Authority has reason to believe that a person is conducting financing business without a licence, the Authority may call for the books, accounts and records of that person in order to ascertain whether or not that person has violated or is violating any provisions of this Act.
(2) Any person wilfully refusing to submit such books, accounts and records shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $5,000 or to imprisonment for a term not exceeding 12 months or to both.
[33/84]
(3) Upon the conviction of any person under subsection (2), the court shall have power to order the production of any books, accounts and records to the Authority.
[9/2003]
(4) Any person failing to comply with any order under subsection (3) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $5,000 or to imprisonment for a term not exceeding 12 months or to both and, in the case of a continuing offence, to a further fine not exceeding $500 for every day during which the offence continues after conviction.
[33/84]
6.
—(1) Any public company proposing to conduct financing business in Singapore shall, before commencing any such business, apply in writing to the Authority for a licence under this Act.
(2) In considering any application by a public company for a licence, the Authority may require to be satisfied as to —
(a)
the financial condition of the company;
(b)
the character of the management of the company;
(c)
the adequacy of the capital structure and earning prospects of the company;
(d)
the objects of the company as disclosed in its memorandum of association;
(e)
the convenience and needs of the community to be served; and
(f)
whether the public interest will be served by the granting of a licence.
(3) The Authority may grant a licence with or without conditions, or refuse to grant a licence.
(4) The Authority may at any time vary or revoke any existing conditions of a licence or impose additional conditions.
(5) Where a licence is granted subject to conditions, the finance company shall comply with those conditions and any finance company that fails to comply with any of the conditions of its licence shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $20,000 and, in the case of a continuing offence, to a further fine of $2,000 for every day during which the offence continues after conviction.
[33/84]
(6) Any person who knowingly or recklessly furnishes any document or information which is false or misleading in a material particular in connection with an application for a licence falling within subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 3 years or to both.
[33/84]
(7) Every finance company shall pay such annual licence fee (including fees in respect of each of its branches) as the Authority may determine by notice in writing and in such manner as the Authority may determine.
[27/94]
(8) Any applicant who is aggrieved by the refusal of the Authority to grant a licence under subsection (3) may, within 30 days of the decision of the Authority, appeal in writing to the Minister whose decision shall be final and shall be given effect to by the Authority.
[27/94]
7.
—(1) Subject to this Act, a company shall not be granted or hold a licence unless —
(a)
in the case of a finance company which holds a licence to carry on financing business on 18th January 1995, its capital funds are, subject to this section, not less than $50 million; and
(b)
in the case of a finance company which is granted a licence to carry on financing business after 18th January 1995, its issued and paid-up capital is not less than $50 million and its capital funds are not less than that amount.
[27/94]
(2) Notwithstanding subsection (1)(a), the Authority may, at any time, after 8 years from 18th January 1995, by order require the issued and paid-up capital of a finance company to which that subsection applies to be not less than $50 million within such time as may be specified in that order.
[27/94]
(3) Subject to subsection (4), a finance company to which subsection (1)(a) applies which has capital funds of less than $50 million on 18th January 1995 shall be exempt from the requirement of that provision for 8 years from 18th January 1995 and shall not during that period allow its capital funds to be less than its capital funds on that date.
[27/94]
(4) If 20% or more of the issued and paid-up capital of a finance company is acquired by one or more persons who, alone or acting together with any associate or associates, by virtue of such acquisition becomes a substantial shareholder of the finance company on or after 18th January 1995, the finance company —
(a)
shall have not less than $50 million in issued and paid-up capital; and
(b)
shall cease to be eligible for the exemption under subsection (3),
unless all the new substantial shareholders are finance companies each with capital funds of not less than $50 million at the time of the acquisition.
[27/94]
(5) A finance company shall not reduce its paid-up capital during the currency of its licence without the approval of the Authority.
[27/94]
(6) The Authority may restrict or suspend the operations of a finance company which fails to comply with subsection (2), (3), (4) or (5).
[27/94]
(7) In this section, “substantial shareholder” has the same meaning as in section 81 of the Companies Act (Cap. 50).
[27/94]
7A.
—(1) The Authority may require every finance company to maintain capital funds in Singapore in proportion to its total assets or to every category of assets at such ratio or ratios as may from time to time be determined by the Authority by notice in writing.
[27/94]
(2) A finance company shall maintain a capital adequacy ratio of not less than 12% or such other percentage as may be determined by the Authority from time to time, as calculated in accordance with such form, content and manner as may be determined by the Authority by notice in writing.
[27/94]
(3) The Authority may suspend or restrict the operations of a finance company which fails to comply with subsection (2) or any requirement of the Authority under subsection (1).
[27/94]
8.
—(1) No finance company shall open any new branch, agency or office, whether in Singapore or elsewhere, without submitting an application in writing to the Authority.
(2) In considering the application, the Authority may require to be satisfied by an inspection under section 33 or otherwise, as to —
(a)
the financial condition of the company;
(b)
the general character of the management of the company;
(c)
the adequacy of the capital structure and earning prospects of the company;
(d)
the convenience and needs of the community to be served; and
(e)
whether the public interest will be served by the opening or, as the case may be, change of location of the place of business.
(3) Upon being so satisfied as to the matters referred to in subsection (2), the Authority may —
(a)
grant the application; or
(b)
without assigning any reason, refuse to grant the application,
and the decision of the Authority shall be final.
(4) Any finance company which fails to comply with subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $2,000 for every day during which the default continues.
[33/84]
9.
—(1) No finance company carrying on business in Singapore shall be merged or consolidated with or acquire a majority interest in any other finance company without the prior approval of the Authority.
(2) In considering such an application, the Authority shall have power to call for such information as it may require.
(3) The Authority may approve or refuse the application.
10.
—(1) This section and sections 11 and 12 shall apply to and in relation to all natural persons whether resident in Singapore or not and whether citizens of Singapore or not, and to all bodies corporate or unincorporate, whether incorporated or carrying on business in Singapore or not.
[33/84]
(2) Without prejudice to section 9, no person shall enter into an agreement to acquire shares of a finance company that is incorporated in Singapore by virtue of which he would, if the agreement is carried out, obtain effective control of that finance company without first notifying the Authority of his intention to enter into the agreement and obtaining the approval of the Authority to his entering into the agreement.
[33/84]
(3) For the purposes of this section —
(a)
a person shall be regarded as entering into an agreement by virtue of which he would obtain effective control of a finance company if the person alone or acting together with any associate or associates of that person would be in a position to control not less than 20% of the voting power in the finance company or would hold interests in not less than 20% of the issued shares of the finance company;
(b)
a reference to an agreement by which a person would obtain effective control of a finance company that is incorporated in Singapore includes a reference to an agreement by which the person would acquire any interest in shares in the finance company where, upon the acquisition of those interests and of any other interests in other shares of the finance company that he has offered to acquire, he would have effective control of the finance company;
(c)
a reference to a person offering to acquire interests in shares includes —
(i)
a reference to a person making or publishing a statement, however expressed, that expressly or impliedly invites a holder of interests in shares to offer to dispose of interests in shares; and
(ii)
a reference to a person taking part in or proposing to take part in negotiations with a view to the acquisition of shares;
(d)
a person holds an interest in a share if he has any legal or equitable interest in that share and, without limiting the generality of the foregoing, an interest in shares shall have the meaning assigned to that expression in section 7(6) to (10) of the Companies Act (Cap. 50);
(e)
a reference to the voting power in a finance company is a reference to the total number of votes that might be cast in the general meeting of the finance company;
(f)
the following persons are associates of a person:
(i)
the person’s spouse or a parent or remoter lineal ancestor, son, daughter or remoter issue, brother or sister of the person;
(ii)
any partner of the person;
(iii)
any corporation of which the person is an officer;
(iv)
where the person is a corporation, any officer of the corporation;
(v)
any employee or employer of the person;
(vi)
any officer of any corporation of which the person is an officer;
(vii)
any employee of a natural person of whom the person is an employee;
(viii)
any corporation whose directors are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the person or, where the person is a corporation, of the directors of the person;
(ix)
any corporation in accordance with the directions, instructions or wishes of which, or of the directors of which, the person is accustomed or under an obligation, whether formal or informal, to act;
(x)
any corporation in which the person who is in a position to control not less than 20% of the voting power in the corporation; and
(xi)
where the person is a corporation, a person who is in a position to control not less than 20% of the voting power in the corporation.
[33/84]
(4) Any person who contravenes subsection (2) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 3 years or to both.
[33/84]
11.
—(1) No person shall enter into any arrangement in relation to any finance company that is incorporated in Singapore by virtue of which he would, if the arrangement is carried out, obtain control of the finance company without first notifying the Authority of his intention to enter into the arrangement and obtaining the approval of the Authority to his entering into the arrangement.
[33/84]
(2) For the purposes of this section —
(a)
a person shall be regarded as entering into an arrangement by virtue of which he would obtain control of a finance company if he alone or acting together with an associate or associates would be in a position to determine the policy of the finance company;
(b)
the reference to entering into any arrangement is a reference to any formal or informal scheme, arrangement or understanding, whether expressly or by implication and, in particular, includes a reference —
(i)
creating a trust whether express or implied; and
(ii)
entering into a transaction or agreement,
and references to an arrangement shall be construed accordingly; and
(c)
the reference to associates of a person has the same reference as under section 10.
[33/84]
(3) Any person who contravenes subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 3 years or to both.
[33/84]
12.
—(1) No person shall enter into any agreement to acquire shares by virtue of which he would, if the agreement is carried out, acquire a substantial shareholding in a finance company that is incorporated in Singapore without first notifying the Authority of his intention to enter into the agreement and obtaining the approval of the Authority to his entering into the agreement.
[33/84]
(2) For the purposes of this section —
(a)
a reference to an agreement by which a person would acquire a substantial shareholding in a finance company includes a reference to an agreement by virtue of which the person would acquire any interests in shares in the finance company where, upon the acquisition by him of those interests or of those interests and of any interest in other shares in the finance company, being interests that he has offered to acquire, he would acquire a substantial shareholding in the finance company;
(b)
a reference to a person offering to acquire interests in shares and to a person having an interest in shares shall be construed in the same way as under section 10; and
(c)
a substantial shareholding has the same meaning as in section 81 of the Companies Act (Cap. 50).
[33/84]
(3) Any person who contravenes subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $10,000 or to imprisonment for a term not exceeding 12 months or to both.
[33/84]
Power of Authority to require finance company that is incorporated in Singapore to obtain information as to beneficial interests in shares of finance company
13.
—(1) The Authority may by notice in writing direct a finance company that is incorporated in Singapore to obtain from any shareholder of the finance company and to transmit to the Authority information —
(a)
as to whether that shareholder holds any voting shares in the finance company as beneficial owner or as trustee; and
(b)
if he holds them as trustee, to indicate, as far as it can, the person for whom he holds them (either by name or by other particulars sufficient to enable those persons to be identified) and the nature of their interest,
and the finance company shall comply with that direction within such time as is specified in the notice.
[33/84]
(2) For the purposes of this section, “voting shares” has the same meaning as in the Companies Act (Cap. 50).
[33/84]
(3) A finance company which fails to comply with a direction under this section shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $10,000.
[33/84]
14.
—(1) Every finance company that intends to alter its memorandum of association or articles of association shall, before proposing any resolution in this regard, furnish to the Authority for its approval particulars in writing (verified by a statutory declaration made by the secretary of the finance company) of the proposed alteration.
(2) The Authority may thereupon —
(a)
approve the proposed alteration without modification;
(b)
approve the proposed alteration with modification; or
(c)
refuse to approve the proposed alteration.
(3) If the Authority approves the proposed alteration with modification, the finance company shall adopt the proposed alteration as so modified or not proceed with the proposed alteration.
(4) If the Authority refuses to approve the proposed alteration it may request the finance company to withdraw the proposed alteration and the finance company shall comply with the Authority’s request.
(5) Any finance company which fails to comply with the requirements of subsection (1) or with any request by the Authority made under subsection (4) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $1,000 for every day during which the default continues after conviction.
[33/84]
15.
—(1) The Authority —
(a)
shall, by order, revoke the licence of a finance company if the company ceases to carry on the business for which it has been licensed in Singapore or goes into liquidation or is wound up or otherwise dissolved;
(b)
may, in its discretion, by order, revoke the licence of a finance company if, in its opinion, the finance company —
(i)
has furnished information or documents to the Authority in connection with its application for a licence which is or are false or misleading in a material particular;
(ii)
is carrying on its business in a manner likely to be detrimental to the interests of its depositors;
(iii)
has insufficient assets to cover its liabilities to its depositors;
(iv)
carries on business while its paid-up capital (unimpaired by losses or otherwise) is less than $500,000; or
(v)
is contravening or has contravened the provisions of this Act;
(vi)
is contravening or has contravened any provision of the Deposit Insurance and Policy Owners’ Protection Schemes Act 2011 (Act 15 of 2011) or any Rules issued by the deposit insurance and policy owners’ protection fund agency under the Deposit Insurance and Policy Owners’ Protection Schemes Act 2011; and
(c)
may, also in its discretion, by order, revoke the licence of a finance company —
(i)
if the finance company or any of its directors or officers holding a managerial or executive position in that finance company has been convicted of any offence under this Act; or
(ii)
if, upon taking action under section 35(2), it considers it in the public interest to do so.
[33/84; 31/2005; 15/2011]
(2) Before revoking any licence, the Authority shall give the finance company notice in writing of its intention to do so, specifying a date, not less than 21 days after the date of the notice, upon which the revocation will take effect and calling upon the finance company to show cause to the Authority why the licence should not be revoked.
(3) Where the Authority has revoked a licence under subsection (1), the Authority shall forthwith inform the finance company by notice in writing of the revocation.
[33/84]
16.
—(1) Where an order of revocation becomes effective under section 15 —
(a)
notice of the revocation shall be published in the Gazette; and
(b)
the finance company shall, as from the date of the notice, cease to transact any financing business in Singapore except as may be approved by the Authority for the purpose of winding up its financing business.
[33/84]
(2) Subsection (1)(b) shall not prejudice the enforcement by any person of any right or claim against the finance company or by the finance company of any right or claim against any person.
[33/84]
17.
—(1) The Authority shall cause to be published in the Gazette in the month of April in each year a list of all finance companies to which licences have been issued under this Act.
(2) If any licence is issued or revoked during the interval between the publication of 2 such lists, notice thereof shall also be caused to be published in the Gazette.