Product suitability, due diligence and management responsibility: The new regime of regulation 18B of the financial advisers regulations

• Main Author: LOW, Kee Yang
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2012
• Subjects: Asian Studies; Banking and Finance Law; Commercial Law
• Online Access: https://ink.library.smu.edu.sg/sol_research/1397; https://ink.library.smu.edu.sg/context/sol_research/article/3349/viewcontent/_2012__24_SAcLJ_298_313__Reg_18B_FAR_.pdf
• Institution: Singapore Management University

In response to the structured products crisis of 2008, many changes were made to the Singapore regulatory landscape over the past three years. More recently, in July 2011, the Financial Advisers Regulations (Cap 110, Rg 2, 2004 Rev Ed) was amended and an important new provision – reg 18B – was added. Regulation 18B requires a financial adviser and its senior management to conduct a comprehensive due diligence exercise before selling a new product. This comment considers reg 18B’s overall scheme, its interpretational difficulties, the demands of the diligence requirements, its interrelation with s 27 of the Financial Advisers Act (Cap 110, 2007 Rev Ed) and the extent to which the regulatory regime has been altered.