By Lee Su Shyan

FINANCE sector professionals are set to benefit from changes to the law to cut red tape in licensing procedures.

The proposed changes to the Securities and Futures Act (SFA) will also streamline disclosure requirements for directors and large shareholders of listed companies.

They are the result of consultation between the Monetary Authority of Singapore (MAS) and industry players launched in 2006.

A key change involves the capital markets licensing procedure.

Now, those holding such licences, including corporate finance bankers and fund managers, have to renew their licences every three years.

With the change, there will be a perpetual licensing regime for them. The proposed law will also make clearer which appointments at banks and fund management outfits need the MAS' approval.

Another set of changes relates to market misconduct.

It will be easier for evidence to be transferred between the Commercial Affairs Department - representing the criminal aspect - and the MAS, which handles civil cases.

The law will also change such that the MAS can ask the court to prevent someone whose trading account was used by his broker for illegal trades, from keeping the gains.

Disclosure requirements are also being simplified for large shareholders and directors of listed companies. Previously, they needed to inform the company and the Singapore Exchange of changes in their stakes. Now, they only need to tell the company, which will inform investors.

Another set of changes beefs up the MAS' regulatory powers.

Its emergency powers have been extended in the event that any of the brokerages or exchanges fails.

The MAS is allowed to appoint an adviser to help the outfit manage its business.

The proposed changes also make the authorities more responsive to market innovation and new products.

The definition of securities in the SFA will be tweaked to allow new products to be introduced more efficiently. The Financial Advisers Act will be amended in similar ways, for example, with regard to licensing procedures.

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This article was first published in The Straits Times on September 16, 2008.