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On 17 September 2019, the Ministry of Law
(“MinLaw“) issued a press release to
remind dealers of precious stones and precious metals
(“Regulated Dealers“) to register their
business with the Registrar of Regulated Dealers
(“Registrar“) under the Precious Stones
and Precious Metals (Prevention of Money Laundering and Terrorism
Financing) Act 2019 (“PSPM Act“) by 9
October 2019.
Application to the Registrar for Registration as Regulated
Dealers
Applicants must pay a non-refundable application fee of $140
upon submission of a new application (or renewal) and a
registration fee of $300 per place of business per year upon
notification by the Registrar. Applicants have the option to apply
for a specific class of registration, that will determine the
period of registration, viz. Class 3 (3 years), Class 2 (2 years)
and Class 1 (1 Year).
On 10 April 2019, the PSPM Act took effect to establish the
regulatory regime, in particular, anti-money laundering and
countering financing of terrorism
(“AML/CFT“) measures for Regulated
Dealers.
Regulatory Scope of the PSPM Act
Under the PSPM Act, any dealer of precious stones, precious
metals, precious products or asset-backed tokens (as defined
thereunder) are required, amongst other things, to register to be a
“registered dealer”.
An “asset-backed token” refers to a token, certificate
or other instrument backed by precious stones, precious metals or
precious products, but excludes:
- securities or derivatives contracts
within the meanings of the Securities and Futures Act (Cap. 289);
and - commodity contracts within the
meaning of the Commodity Trading Act (Cap. 48A).
Section 6(1) of the PSPM Act prohibits a person from acting or
holding out to be a “regulated dealer” unless the person
is a registered dealer.
A “regulated dealer” as defined under the PSPM Act
means a person who carries on a business of regulated dealing or
carries on a business as an intermediary for regulated dealing.
Whereas “regulated dealing” has been defined under the
PSPM Act as doing any of the following:
- manufacturing any precious stone,
precious metal or precious product; - importing or possessing for sale any
precious stone, precious metal or precious product; - selling or offering for sale any
precious stone, precious metal or precious product; - selling or redeeming asset backed
tokens; or - purchasing any precious stone,
precious metal or precious product for the purposes of resale.
End of Transition Period for Existing Regulated Dealers under
the PSPM Act
From 10 October 2019, it will be an offence for any person to
act as or hold out to be a regulated dealer without registration
unless exempted under the PSPM Act. A person who contravenes the
said statutory provision shall be guilty of an offence and shall be
liable on conviction to a fine not exceeding $75,000 or to
imprisonment for a term not exceeding 3 years or to both and, in
the case of a continuing offence, to a further fine not exceeding
$7,500 for every day or part of a day during which the offence
continues after conviction.
Exemptions from the PSPM Act
Financial institutions regulated by the Monetary Authority of
Singapore are already covered under other AML/CFT measures and
therefore exempted from the PSPM Act. Pawnbrokers are also excluded
from the PSPM Act as they are subject to AML/CFT provisions under
the Pawnbrokers Act.
AML/CFT measures applicable to Regulated
Dealers
Regulated Dealers are required to implement and comply with the
following requirements under the PSPM Act and the
Precious Stones and Precious Metals (Prevention of Money Laundering
and Terrorism Financing) Regulations 2019, inter
alia:
- To perform customer due diligence
(“CDD“) measures under prescribed
circumstances, in addition to the existing requirement to do so for
cash transactions above S$20,000; - To submit a copy of the cash
transaction reports (“CTR“) to the
Registrar, in addition to existing requirements to file a CTR; - To keep records of transactions where
CDD measures are performed, and information obtained through these
CDD measures; - To submit a copy of the information
of suspicious transaction to the Registrar, in addition to the
existing requirements under the Corruption, Drug Trafficking and
Other Serious Crimes (Confiscation of Benefits) Act and the
Terrorism (Suppression of Financing) Act; - To conduct ongoing monitoring of
transactions by periodically reviewing the information and
documents obtained as a result of the CDD measures.
As at 15 September 2019, the MinLaw has received 1,475
applications for registration, with 1,889 unique outlets. For more
information on the registration process and the PSPM Act, you may
access the following materials on the MinLaw website:-
This update is provided to you for general information and
should not be relied upon as legal advice.
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