The Monetary Authority of Singapore (MAS) requires parties to a Specified Derivative Contract (SDC) to report to a licensed trade repository or licensed foreign trade repository under the Securities and Futures (Reporting of Derivatives Contracts) Regulations 2013.
What is the reporting obligation?
MAS requires only certain over-the-counter (OTC) derivative contracts to be reported. Exchange-traded derivatives contracts including futures contracts and block futures contracts are not in the scope of the regime and therefore, they don’t need to be reported.
TRAction has summarised which OTC SDCs are to be included and excluded in your MAS trade reports in the table below:
Please refer to section 2 of the Regulations for detailed definitions of these five types of reportable derivatives.
Who is required to report?
The following entities are required to report subject to exemptions:
- any holder of a capital markets services licence (CMSL) subject to exemption;
- any Significant Derivatives Holder (SDH) as set out in section 6 of the Regulations (see below for more detail);
- any bank in Singapore licensed under the Banking Act (Chapter 19);
- any subsidiary of a bank incorporated in Singapore subject to exemption;
- any merchant bank approved as a financial institution under the Monetary Authority of Singapore Act;
- any finance company licensed under the Finance Companies Act; and
- any insurer licensed under the Insurance Act subject to exemption.
This is covered at Section 124 of the Act and Section 6 of the Regulations,
Who are Significant Derivatives Holders (SDH)?
- The person does not fall into any category above (see Who is required to report?);
- The person is a resident in Singapore; and
- The person’s aggregate gross notional amount of SDCs which are traded in Singapore for the year exceeds SGD 8 billion.
What to report and to whom?
Depending on the class of SDCs, the reporting details required are different. The following are the reporting information fields required for all classes of SDCs:
- contract information such as Unique Transaction Identifier (UTI);
- counterparty information such as Legal Entity Identifier (LEI);
- clearing information;
- contract confirmation;
- trade execution;
- transactional data;
- timestamp information; and
- option data, if applicable.
All MAS OTC derivative trades are to be reported to a designated TR regulated under MAS. As it stands, DTCC is the only regulated TR for Singapore MAS trade reporting. Reporting entities are required to report the trade information described below within two (2) business days (T+2).
Are you exempt from trade reporting obligations?
The Regulations provide some exemptions from the reporting obligations for the following entities:
- a Capital Markets Services Licence (CMSL) holder:
- which has carried on its business or operations for less than 4 consecutive quarters;
- if the threshold of SGD 5 billion threshold* is met; or
- the counterparty to the relevant SDC is not an accredited investor or an institutional investor (i.e. retail investors);
- an approved trustee mentioned in section 289 of the Act;
- a licensed trust company that entered into the SDC as a trustee;
- a subsidiary of a bank incorporated in Singapore:
- which has carried on its business or operations for less than 4 consecutive quarters; or
- if the threshold of SGD 5 billion threshold is met;
- a licensed insurer:
- which has carried on its business or operations for less than 4 consecutive quarters; or
- if the threshold of SGD 5 billion threshold is met; or
- any persons as specified in the fourth schedule of the Regulation including the Singapore government, central banks, multilateral development agencies and international organisations.
*The SGD 5 billion threshold refers to the aggregate gross notional amount of relevant derivatives contracts for past 4 calendar quarters not exceeding SGD 5 billion. The gross notional amount for each quarter is be assessed on the last day of that quarter.
Specifically in the case of a CMSL, the calculation of the aggregate gross notional amount:
- excludes derivatives contracts where a party to the contract is not an accredited investor or institutional investor; and
- includes both derivatives contracts to which the CMSL is a party and to which the CMSL has entered into on behalf of another person.
Where can I find the MAS reporting rules?
The reporting obligations are set out in Securities and Futures Act (Chapter 289) (the Act), Securities and Futures Act (Chapter 289) and Securities and Futures (Reporting of Derivatives Contracts) Regulations 2013 (the Regulations) and you may also find the Frequently Asked Questions on the Regulations useful.