Regulatory Updates December 2025 – APAC Region

On 19 April 2022, the Monetary Authority of Singapore (MAS) issued a consultation paper to seek feedback on proposed legislative amendments to the misconduct reporting requirements for representatives and broking staff. The MAS has since completed its review of industry feedback on the revised notices governing misconduct reporting requirements under the Financial Advisers Act (FAA), Insurance Act (IA) and Securities and Futures Act (SFA).

This article summarises the key themes arising from the feedback and MAS’ responses, highlighting what Financial Institutions (FIs) should focus on as they prepare for implementation.

• FIs are required to submit a misconduct report once there are reasonable grounds to believe misconduct has occurred or is likely to have occurred; conclusive findings are not required at the point of initial reporting.
• MAS has provided further guidance on when investigation reports are expected, while emphasising the need for a robust internal investigation process.
• FIs should assess, on a case-by-case basis, whether misconduct involving fraud, dishonesty or potential criminality warrants a police report.
• Guidance has been provided on notifying the individual concerned and managing communications appropriately.
• The timeline for submitting the initial misconduct report has been extended to 21 days from the point reasonable grounds arise (previously 14 days).

To view the responses and revised notices:

• Response to feedback
• FAA N27
• MAS 508
• SFA 04 N24

The MAS issued the Banking and Finance Sectoral Threat Profile for 2025. This paper outlines key IT and cyber security incidents involving FIs and their third-party service providers and identifies the most significant cyber and technology-enabled threats facing Singapore’s financial sector. The following are key observations from the report:

• Ransomware continues to be the most significant cyber risk, largely due to compromised credentials, limited use of MFA, long undetected dwell times and gaps in monitoring, affecting both financial institutions and their service providers
• Third-party and supply-chain exposures remain a key area of concern, as vendor breaches and insider collusion have resulted in data exposure across multiple financial institutions
• DDoS attacks are becoming more complex, with attackers using layered techniques that have, in some cases, exposed coordination and response gaps between financial institutions and their mitigation providers
• Cyber-espionage risks remain elevated, particularly through the exploitation of edge devices such as VPNs and firewalls and the use of zero-day vulnerabilities, even though no direct incidents involving local financial institutions were observed.
• Mobile-enabled and NFC-related fraud continues to evolve, with an increase in malware-driven scams despite an overall decline in total scam losses
• AI-enabled threats are beginning to emerge, including the use of deepfake impersonation and weaknesses in generative AI systems, which increase the risk of fraud and data leakage.

MAS expects FIs to strengthen IT controls and proactively manage emerging cyber security risks.

For further information, please refer to MAS circulars.

On 4 December 2025, the MAS published an information paper setting out the findings of its thematic review of FI’s recruitment, onboarding and training of representatives. The review, conducted on selected FIs regulated under the Financial Advisers Act (FAA), highlights both good practices and areas of weakness, and clarifies MAS’ supervisory expectations in ensuring representatives are fit and proper to carry out regulated activities.

The following are a summary of good and poor practices observed in the study:

Good Practices

• Stronger governance over recruitment: Some firms showed good discipline in hiring, with senior management involved in decisions, proper due diligence, and sensible limits on appointing individuals with adverse information to supervisory roles.
• More effective onboarding training: Well-designed training programmes helped ensure representatives understood products, advisory processes and internal requirements before dealing with clients.
• Clearer controls over assistants: A number of firms put basic but important safeguards in place, such as written undertakings and clearer role boundaries, to prevent assistants from performing regulated activities.

Poor Practices

• Fit and proper checks were not always robust: Assessments of financial soundness and conflicts of interest were sometimes superficial, inconsistent, or poorly documented.
• Monitoring of higher-risk representatives was weak: Enhanced monitoring measures were often generic, poorly enforced, or removed without proper review.
• Training gaps were evident: Some representatives and supervisors were allowed to operate before completing the necessary training, including reliance on third-party materials that were not adequately reviewed.
• Oversight of assistants and outsourcing was inadequate: Weak governance over assistants and outsourced activities resulted in control gaps and increased regulatory risk.

MAS expects firms to take ownership and implement proper recruitment and training processes. Whilst the review targeted FA firms, FIs are encouraged to review the paper and improve internal processes accordingly.

For further information, please click here.

On 05 December 2025, the Securities and Futures Commission (SFC) and the Hong Kong Monetary Authority (HKMA) jointly issued a circular to intermediaries announcing the launch of the 2025 joint survey on the sale of non-exchange-traded investment products by licensed corporations (LCs) and registered institutions (RIs) licensed or registered for Type 1 (dealing in securities), Type 4 (advising on securities) or both regulated activities (Reporting Intermediaries), with submissions required via WINGS by stipulated deadlines in January to March 2026. (circular)

The SFC-HKMA circular outlines the annual survey covering sales of non-exchange-traded investment products (such as collective investment schemes, debt securities, structured products, swaps, swaptions and repos) to non-institutional professional investors and certain corporate professional investors during the period 1 January to 31 December 2025; requires completion of a three-part questionnaire; and notes that information will be treated confidentially with only anonymized aggregated statistics disclosed.

This facilitates understanding of industry landscape, market trends and selling practices to enhance supervision and coordination; questionnaires, guidance notes and instructions are available on WINGS.

For assistance with notifications, please kindly contact Waystone.

To view the circular, please click here.

On 12 December 2025, the Securities and Futures Commission (SFC) issued a circular in relation to the clearing and record keeping rules for the OTC derivatives regime, announcing changes to the list of persons designated as financial services providers (FSPs), with the revised list gazetted on that date and effective from 1 January 2026. (circular)

The SFC circular reminds Licensed Persons that, if their average total position in OTC derivatives during a Calculation Period reaches the Clearing Threshold (USD 20 billion), relevant OTC derivative transactions entered into on or after the corresponding Prescribed Day (seven months after the end of the Calculation Period), including those with FSPs, must be centrally cleared in accordance with the Securities and Futures (OTC Derivative Transactions—Clearing and Record Keeping Obligations and Designation of Central Counterparties) Rules (Clearing Rules).

This supports ongoing compliance with the mandatory clearing regime; Licensed Persons should refer to the Clearing Rules and the Frequently Asked Questions on the Implementation and Operation of the Mandatory Clearing Regime for details.

For assistance with notifications, please kindly contact Waystone.

To view the circular, please click here.

On 22 December 2025, the Securities and Futures Commission (SFC) issued a circular to licensed corporations announcing an exemption for non-centrally cleared equity options (single-stock options, equity basket options and equity index options) from its margin requirements under Part III of Schedule 10 to the Code of Conduct for Persons Licensed by or Registered with the Securities and Futures Commission, effective from 4 January 2026 until further notice. (circular)

The SFC circular defers the originally scheduled margin requirements to align with recent global developments, including a permanent exemption in the European Union effective 24 December 2024 (subject to monitoring and reporting) and an indefinite exemption in the UK implemented on 27 November 2025; notes that licensed corporations’ exposures to such products are currently insignificant, helping prevent regulatory arbitrage; and states that paragraph 7(e) of Part III of Schedule 10 to the Code of Conduct will be amended and gazetted accordingly.

This supports international consistency in risk-mitigation requirements for non-centrally cleared derivatives; licensed corporations should contact their case officers for queries.

For assistance with notifications, please kindly contact Waystone.

To view the circular, please click here.