Securities Regulations M1 Flashcards

What is the 'safe harbour' provision in securities regulation?

Answer: A legal protection from liability when certain conditions are met

Safe harbour provisions protect individuals or companies from legal liability if they can demonstrate compliance with specified conditions or procedures.

What is the difference between a 'dealing in securities' licence and a 'fund management' licence?

Answer: Dealing involves buying/selling securities; fund management involves managing investment portfolios

Dealing in securities covers the buying and selling of securities for clients, while fund management involves managing pooled investment portfolios on behalf of investors.

What reporting obligation does a substantial shareholder have?

Answer: Must notify the company and SGX when reaching 5% or more of voting shares

A substantial shareholder holding 5% or more of voting shares must notify the company and SGX of their interest and any subsequent changes.

What is the purpose of anti-money laundering requirements in capital markets?

Answer: To prevent the financial system from being used to launder proceeds of crime

AML requirements help prevent criminals from using the financial system to disguise illegal funds as legitimate money.

What is a 'recognised market operator' under the SFA?

Answer: An entity approved by MAS to operate a securities or futures market

A recognised market operator is approved by MAS to operate an organised market for the trading of securities or futures contracts.

What is the cooling-off period for certain investment products in Singapore?

Answer: A period during which the investor can cancel the investment without penalty

The cooling-off period allows investors a short window (typically 7 calendar days) to review and cancel certain investment products without financial penalty.