Singapore Parliament Passes Bill to Regulate Certain Digital Token Service Providers, Harmonise and Enhance MAS Regulatory Power over Fis

The Financial Services and Markets Bill (“FSM Bill“), which seeks to implement a financial sector-wide regulatory approach for financial services and markets, was passed in Parliament on 5 April 2022. The FSM Bill will consolidate the provisions and powers that relate to the Monetary Authority of Singapore’s regulatory oversight of different financial institution classes in a single Act.

The FSM Bill contains provisions on the following key areas:

1. Regulation of certain digital token service providers created in Singapore for anti-money laundering and countering of financing of terrorism purposes;
2. Harmonised power to impose technology risk management requirements on financial institutions and increased maximum penalty for breaches of such requirements;
3. Harmonised and expanded power to issue prohibition orders; and
4. Statutory protection from liability for mediators, adjudicators and employees of an operator of an approved dispute resolution scheme.

This Update provides an overview of these key areas to be regulated under the FSM Bill.