New regime for corporate service providers to start from May 15

THE enhanced regulatory framework for corporate service providers (CSPs) will take effect from May 15, said Singapore's Accounting and Corporate Regulatory Authority (Acra).

This framework was established under the ACRA (Amendment) Act and its related regulations. The Act was passed by Parliament last year.

CSPs are individuals or business entities providing services as a business to third parties such as acting as a formation agent of legal persons.

Under the new CSP regime, CSPs that help to set up companies must conduct the requisite due diligence checks and have robust systems and processes in place to prevent abuse of such corporate vehicles for criminal or other illegitimate purposes.

Persons wishing to provide CSP services will need to register as Filing Agents (FA) and Qualified Individuals (QIs). The framework also imposes terms and conditions on FAs and QIs, and sets out the range of sanctions that Acra may impose on errant FAs and QIs who breach these terms and conditions.

Acra said that a stronger regime for CSPs will boost Singapore's reputation as a trusted international financial and business centre with robust regulatory frameworks against money laundering and terrorism financing. It will also raise the professional standards of the CSP sector.

To help CSPs understand the new legal requirements, Acra worked with representatives from the Singapore Association of the Institute of Chartered Secretaries and Administrators, Institute of Singapore Chartered Accountants, The Law Society of Singapore, Association of International Accountants, and Institute of Company Accountants, to prepare a set of draft guidelines.

A series of seminars was also conducted by Acra from June to October last year to explain the policies. Over 3,400 CSPs have attended the seminars.