Interpretation of this Part
129B. In this Part, unless the context otherwise requires —“clearing” means any arrangement, process, mechanism or service provided by a person in respect of transactions, by which parties to those transactions substitute, through novation or otherwise, the credit of such person for the credit of the parties;
“specified derivatives contract” means any derivatives contract that is, or that belongs to a class of derivatives contracts that is, prescribed by the Authority by regulations made under section 129G for the purposes of this definition;
“specified person” means —(a)
any bank that is licensed under the Banking Act 1970;
(b)
any merchant bank licensed under the Banking Act 1970;
(c)
any finance company licensed under the Finance Companies Act 1967;
(d)
any insurer licensed under the Insurance Act 1966;
(e)
[Deleted by Act 4 of 2017]
(f)
any holder of a capital markets services licence; or
(g)
any other person who is, or who belongs to a class of persons which is, prescribed by the Authority by regulations made under section 129G for the purposes of this definition.[34/2012; 10/2013; 4/2017; 1/2020]
Clearing of specified derivatives contracts
129C.—(1) Every specified person who is a party to a specified derivatives contract must, within such time as the Authority may prescribe by regulations made under section 129G, cause the specified derivatives contract to undergo clearing, by a clearing facility operated by an approved clearing house or a recognised clearing house, in accordance with the business rules of the approved clearing house or recognised clearing house, as the case may be.[34/2012]
(2) Any specified person who contravenes subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part of a day during which the offence continues after conviction.[34/2012]
(3) Except where the parties to a specified derivatives contract have entered into an express agreement to the contrary, the specified derivatives contract is not, by reason only of a contravention of subsection (1) in relation to the specified derivatives contract, voidable or void.[34/2012]
Power of Authority to obtain information
129D.—(1) The Authority may require any person to provide the Authority with such information or documents as the Authority considers necessary for determining —(a)
whether any derivatives contract or class of derivatives contracts should be prescribed for the purposes of the definition of “specified derivatives contract” in section 129B;
(b)
whether the person or any other person or class of persons should be prescribed for the purposes of paragraph (g) of the definition of “specified person” in section 129B; or
(c)
whether the purpose or effect of any contract, arrangement, transaction or class of contracts, arrangements or transactions is to avoid, directly or indirectly, any requirement that is, or that would otherwise have been, imposed under section 129C(1).[34/2012]
(2) Subject to subsections (4) and (5), a person must comply with every requirement imposed on the person under subsection (1).[34/2012]
(3) 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 and, in the case of a continuing offence, to a further fine not exceeding $5,000 for every day or part of a day during which the offence continues after conviction.[34/2012]
(4) A person who complies with a requirement imposed under subsection (1) is not to be treated as being in breach of any restriction upon the disclosure of information imposed by written law, any rule of law, any contract or otherwise.[4/2017]
(5) Nothing in this section compels an advocate and solicitor, or a legal counsel referred to in section 128A of the Evidence Act 1893, to provide any information on, or any document containing, any privileged communication made by or to him or her in that capacity.[34/2012]
(6) Where a person claims, before providing the Authority with any information or documents that the person is required to provide under subsection (1)(c), that the information or documents might tend to incriminate the person, the information or documents —(a)
are not admissible in evidence against the person in criminal proceedings other than proceedings under subsection (3); but
(b)
are admissible in evidence for civil proceedings under Part 12.[34/2012]
Directions on alternative clearing arrangements
129E.—(1) Where the Authority is of the opinion that any clearing facility operated by any approved clearing house or recognised clearing house is not available for the clearing of, or is incapable of clearing, any specified derivatives contract or any class of specified derivatives contracts under section 129C(1), the Authority may issue directions, whether of a general or specific nature, by written notice, to any specified person who is a party to that specified derivatives contract, or any class of specified persons who are parties to that class of specified derivatives contracts, requiring the specified person or class of specified persons to cause that specified derivatives contract or that class of specified derivatives contracts to undergo clearing in the manner and within the time specified by the Authority in that notice.[4/2017]
(2) A specified person referred to in subsection (1) must comply with every direction issued to the specified person under that subsection.[34/2012]
(3) A specified person is treated to have complied with section 129C(1) in relation to a specified derivatives contract if, while a direction issued to the specified person under subsection (1) remains in force, the specified person complies with that direction in relation to that specified derivatives contract.[34/2012; 4/2017]
(4) The Authority may cancel a direction issued under subsection (1) in relation to any clearing facility operated by any approved clearing house or recognised clearing house, if the Authority is of the opinion that the grounds for the issue of the direction have ceased to apply.[34/2012]
(5) Any specified person who, without reasonable excuse, contravenes a direction issued to the specified person under subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part of a day during which the offence continues after conviction.[34/2012]
(6) It is not necessary to publish any direction issued under subsection (1) in the Gazette.[34/2012]
Compliance with laws and practices of relevant clearing jurisdiction
129F.—(1) Subject to subsection (2), a specified person who is a party to a specified derivatives contract is treated to have complied with section 129C(1) in relation to the specified derivatives contract, if —(a)
any other party to the specified derivatives contract is incorporated, formed or established under the laws of, or has a place of business in, a relevant clearing jurisdiction; and
(b)
every party to the specified derivatives contract is required to comply with, and has complied with, in relation to the specified derivatives contract, the requirements relating to the clearing of specified derivatives contracts under the laws and practices of the relevant clearing jurisdiction.[34/2012; 4/2017]
(2) Subsection (1) does not apply to any specified derivatives contract that is, or that belongs to a class of specified derivatives contracts that is, prescribed by the Authority by regulations made under section 129G for the purposes of this subsection.[34/2012]
(3) In this section —“place of business”, in relation to a party to a specified derivatives contract, means a head or main office, a branch, a representative office or any other office of the party;
“relevant clearing jurisdiction” means a foreign jurisdiction that is prescribed by the Authority by regulations made under section 129G for the purposes of this definition.[34/2012]
Power of Authority to make regulations
129G.—(1) Without affecting section 341, the Authority may make regulations for the purposes of this Part, including regulations to prescribe anything which may be prescribed under this Part.[34/2012]
(2) In deciding whether to prescribe any derivatives contract or class of derivatives contracts for the purposes of the definition of “specified derivatives contract” in section 129B, the Authority may have regard to —(a)
the level of systemic risk posed by that derivatives contract or class of derivatives contracts;
(b)
the characteristics and level of standardisation of the contractual terms and operational processes relating to that derivatives contract or class of derivatives contracts;
(c)
the depth and liquidity of the market for that derivatives contract or class of derivatives contracts;
(d)
the availability of fair, reliable and generally accepted pricing sources for that derivatives contract or class of derivatives contracts;
(e)
the international regulatory approach towards that derivatives contract or class of derivatives contracts;
(f)
whether there is any anti‑competitive effect associated with that derivatives contract or class of derivatives contracts;
(g)
the availability of approved clearing houses or recognised clearing houses that operate clearing facilities for the clearing of that derivatives contract or class of derivatives contracts; and
(h)
any other matters that the Authority deems to be relevant.[34/2012]
Exemption from section 129C
129H.—(1) Without affecting section 337(1), the Authority may, by regulations made under section 129G, exempt any specified person or class of specified persons from all or any of the provisions of section 129C, subject to such conditions or restrictions as the Authority may prescribe in those regulations.[34/2012]
(2) The Authority may, by written notice, exempt any specified person from all or any of the provisions of section 129C, subject to such conditions or restrictions as the Authority may specify by written notice.[34/2012; 4/2017]
(3) It is not necessary to publish any exemption granted under subsection (2) in the Gazette.[34/2012]
(4) Every specified person that is granted an exemption under subsection (1) or (2) must satisfy every condition or restriction imposed on the specified person under the applicable subsection.[34/2012]
(4A) The Authority may at any time add to, vary or revoke any condition or restriction imposed under this section.[4/2017]
(5) Any specified person who contravenes subsection (4) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part of a day during which the offence continues after conviction.[34/2012]
Source: Singapore Statutes Online (Attorney-General's Chambers), © Government of Singapore.
