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MAS unveils proposals to strengthen OTC derivatives market, improve provision of financial advisory services 

June 3, 2015

Jacquelyn Cheok, Business Times

THE Monetary Authority of Singapore (MAS) has unveiled proposals to strengthen Singapore's over-the-counter (OTC) derivatives market and to enhance the provision of financial advisory services.

In a consultation paper released on Wednesday, MAS proposed a regulatory framework for capital markets intermediaries dealing in OTC derivative contracts, as well as refinements to rules governing financial advisory services.

Under the proposed framework, intermediaries dealing in OTC derivatives will have to meet prescribed capital and business conduct requirements, such as putting in place risk management policies and controls to safeguard customers' assets.

MAS also proposes to introduce a set of risk mitigation requirements for intermediaries that deal in non-centrally cleared OTC derivatives, which will serve to enhance legal certainty over the terms of non-centrally cleared OTC derivatives transactions, foster effective management of counterparty credit risk, and facilitate timely dispute resolution.

As for refining the rules governing financial advisory services, MAS proposes to exempt from the Financial Advisers Act (FAA) trading representatives (TRs) who provide advice that is incidental to their execution services.

Read more: TheBusinessTimes

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