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Singapore Amends and Levels the Playing Field for Cross-Border Financial Business Arrangements

In a move to strengthen its regulatory framework, Singapore’s Monetary Authority of Singapore (MAS) has introduced new requirements for financial institutions (FIs) operating cross-border business arrangements.

New Requirements for FIs

According to a recent announcement, FIs must obtain opt-in agreements from customers who are classified as “Artificial Intelligence” (AI) by the Singapore Entity or Foreign Representative Company (FRC). This requirement is part of the MAS’s efforts to ensure compliance with anti-money laundering and counter-terrorism financing (AML/CFT) regulations.

Customer Due Diligence Measures

Under the new framework, FIs must conduct customer due diligence (CDD) measures on all customers served under cross-border business arrangements. This includes:

• Keeping records of CDD performed for a period of five years
• Ensuring adequate internal policies and procedures are in place to ensure consistency with AML/CFT requirements
• Providing MAS with requested information

Active Role in Formulating Policies and Procedures

The MAS has also emphasized the importance of FIs taking an active role in formulating policies and procedures relating to cross-border arrangements, and maintaining oversight over the conduct of FRCs or Foreign Branches.

Key Takeaways

• FIs must obtain opt-in agreements from customers classified as AI
• CDD measures must be conducted on all customers served under cross-border business arrangements
• FIs are responsible for ensuring compliance with AML/CFT regulations
• FIs must take an active role in formulating policies and procedures relating to cross-border arrangements

Contact

For more information or advice on complying with these new regulations, please contact:

Lena Ng, Partner at Clifford Chance Email: lena.ng@cliffordchance.com Phone: +65 6410 2215