eOASIS is Rajah & Tann Singapore LLP's legal information website for clients, containing business and legal information prepared from a practitioner's viewpoint. It has four different modules, updated regularly, and materials range from commentaries on the latest legal developments to key legal and business information.
Additional Conveyance Duties to be Imposed on Transfers of Equity Interests in Property Holding Entities into Living Trusts
On 9 May 2022, the Stamp Duties (Amendment) Bill 2022 ("Bill") was introduced in Parliament. The Bill seeks to effect two main changes: (a) Introduce the Additional Conveyance Duties for Trust, which will be payable on transfers of equity interests in property-holding entities ("PHEs") into a living trust, provided the significant ownership threshold has been reached; and (b) Sets out the stamp duty payable on the renunciation of an interest in a residential property held on bare trust.
The Bill is part of the measures introduced by the Government to plug a gap in the existing Additional Conveyancing Duties and Additional Buyer's Stamp Duty regime relating to the transfer of property, or equity interests in PHEs, into a living trust. This Update provides a summary of the key points of the Bill.
Recoverability of Wage Payments Made to Seafarers by a P&I Club as Sheriff's Expenses – A Landmark Decision in India
The Indian courts, in the recent decision of the Bombay High Court in The Swedish Club v V8 Pool Inc. and Other. (Commercial Appeal Nos. 108 and 111 of 2021), were accorded the opportunity to pronounce upon whether crew wages incurred post-arrest could be ranked as Sheriff's (or marshal's) expenses. The judgment also considered whether recoupment of such wages, as well as sustenance provisions supplied by a Protection & Indemnity Club ("P&I Club") pursuant to the Maritime Labour Convention, are also to be treated as Sheriff's expenses by virtue of subrogation to all "top-drawer" recovery.
Rajah & Tann Singapore LLP was heartened by the opportunity to act alongside the P&I Club's Hong Kong offices, and to formulate legal submissions in conjunction with its Bombay counsel team. The Club was advised by Kendall Tan and Yip Li Ming from the Shipping & International Trade Practice.
Additional Buyer's Stamp Duty (ABSD) Imposed on All Transfers of Residential Property into Living Trust
When a residential property is transferred into a living trust, buyer's stamp duty is payable. Additional buyer's stamp duty ("ABSD") may also be payable, depending on the profile of the beneficial owners of the residential property transferred into the trust. The Singapore Government imposes ABSD on the transfer or sale and purchase agreements of residential properties in Singapore as part of the cooling measures on the purchase of residential properties.
On 8 May 2022, the Singapore Government announced changes to the ABSD regime by imposing ABSD at the rate of 35% for all conveyance, assignments or transfers on sale and purchase of residential properties into a living trust that occur on or after 9 May 2022 (regardless of whether there are identifiable beneficial owners of the residential properties) ("ABSD (Trust)"). ABSD (Trust) is to be paid upfront when the residential properties are transferred into the living trust, but is subject to remission if certain prescribed conditions are met.
This Update sets out a summary of the key changes to ABSD (Trust) and highlights some practical issues to note in determining the appropriate trust structure to hold residential properties for succession planning purposes.
MAS Consults on Revised Notices on Misconduct Reporting Requirements under Financial Advisers Act, Insurance Act, Securities and Futures Act
On 19 April 2022, the Monetary Authority of Singapore ("MAS") issued a Consultation Paper on "Revised Notices on Misconduct Reporting Requirements under the Financial Advisers Act, Insurance Act and Securities and Futures Act" ("2022 Consultation Paper"). This follows from a 2018 consultation exercise conducted by MAS where it sought views on, among other things, changes to misconduct reporting requirements under the Financial Advisers Act 2001 ("FAA"), Insurance Act 1966 ("IA") and Securities and Futures Act 2001 ("SFA"). MAS issued its Response to feedback received on the 2018 consultation in 2021.
At present, financial institutions ("FIs") are required under the FAA, IA and SFA to lodge a report with MAS when they become aware of misconduct committed by their representatives or broking staff. The misconduct reporting requirements are set out in the following existing MAS Notices: FAA-N14 Notice on Reporting of Misconduct of Representatives by Financial Advisers ("FAA Notice"); MAS 504 Notice on Reporting of Misconduct of Broking Staff by Insurance Brokers ("IA Notice"); and SFA 04-N11 Notice on Reporting of Misconduct of Representatives by Holders of Capital Markets Services Licence and Exempt Financial Institutions ("SFA Notice").
The 2022 Consultation Paper seeks comments on the proposed legal amendments to the FAA Notice, IA Notice and SFA Notice to implement the proposed changes to the misconduct reporting requirements. MAS also seeks views on the new prescribed templates for FIs to submit the misconduct and investigation reports to MAS. The 2022 consultation exercise closes on 20 May 2022.
This Update briefly highlights some of the key proposed changes to the misconduct reporting requirements following feedback from the 2018 MAS consultation and the new prescribed templates for misconduct and investigation reports.