Statute Details
- Title: Financial Services and Markets (Digital Token Service Providers) Regulations 2025
- Act Code: FSMA2022-S342-2025
- Type: Subsidiary legislation (SL)
- Status: Current version as at 27 Mar 2026
- Enacting Authority: Monetary Authority of Singapore (MAS)
- Authorising Act: Financial Services and Markets Act 2022 (FSMA 2022)
- Legal Basis: Powers conferred by sections 167 and 192 of FSMA 2022
- Citation: S 342/2025 (Financial Services and Markets Act 2022)
- Commencement: 30 June 2025
- Made Date: 29 May 2025
- Key Parts/Divisions (as reflected in the extract): Part 1 (Preliminary); Part 2 (Licensing of Digital Token Service Providers) including Divisions 1–4
- Key Provisions Highlighted in Extract: s 2 (Definitions); s 3 (Forms); s 4 (Time for documents to be lodged); s 5 (Fees); s 6 (Application for licence); s 7 (Prescribed financial requirements); s 8 (Lapsing of licence); s 9 (Financial requirements while licence is in force); s 10 (Approval of key persons); s 11 (Audit report); Schedule (Fees)
What Is This Legislation About?
The Financial Services and Markets (Digital Token Service Providers) Regulations 2025 (“DTSP Regulations 2025”) are subsidiary legislation made under the Financial Services and Markets Act 2022 (“FSMA 2022”). In practical terms, they operationalise the licensing regime for “digital token service providers” by setting out the procedural and regulatory requirements that sit alongside the main provisions in FSMA 2022.
While FSMA 2022 establishes the overall framework for regulating digital token-related activities, the DTSP Regulations 2025 fill in the operational details: how applications must be made, what financial requirements are prescribed, when licences lapse, what ongoing financial obligations apply during the licence period, the approval process for senior management and controllers, and the audit reporting expectations. The Regulations also address administrative matters such as the forms to be used, time limits for lodging documents, and the fees payable to MAS.
For lawyers advising applicants, licensed entities, or prospective controllers, the Regulations are important because they translate statutory concepts into concrete compliance steps. They also create enforceable obligations through procedural requirements (e.g., using the correct forms and paying the correct fees) and substantive requirements (e.g., prescribed financial requirements and audit reporting).
What Are the Key Provisions?
1) Definitions that drive capital and eligibility calculations (s 2). The Regulations include detailed definitions that affect how a firm’s financial position is measured. A central example in the extract is the definition of “base capital” for a company. “Base capital” is calculated by taking specified components from the latest accounts—such as paid-up ordinary share capital and paid-up irredeemable and non-cumulative preference share capital—plus unappropriated profit or loss, and then subtracting interim losses and dividends declared since the latest audited accounts.
The definition also includes a carefully structured description of “irredeemable and non-cumulative preference share capital”. This is not merely descriptive; it sets conditions that preference shares must satisfy to qualify for the capital computation. These conditions include: the principal being perpetual; non-callability at the initiative of the company or shareholders; repayment being restricted except in permitted reduction/repurchase scenarios under written law; and the company having full discretion to cancel dividends, with additional safeguards ensuring dividend cancellation does not trigger default under agreements, does not impair access to cancelled dividend payments to meet obligations, and does not impose restrictions except in relation to dividend payments to ordinary shareholders.
2) Forms, submission mechanics, and MAS’s acceptance controls (s 3). Section 3 is a procedural “gatekeeping” provision. It requires that forms used for purposes of the Regulations are the current versions displayed on MAS’s website. It also requires documents to be lodged/submitted in the relevant form and manner specified by MAS, and completed in English and in accordance with any directions in the form or by MAS.
Critically, MAS may refuse to accept a form if (a) it is not completed or lodged/submitted in accordance with s 3, or (b) where a fee is specified in the Schedule for the matter, the form is not accompanied by the fee. This means that compliance is not only substantive; it is also administrative. For practitioners, this is a reminder to treat form completion and fee payment as part of the legal validity of an application or submission.
Section 3 also provides flexibility: where strict compliance with a form is not possible, MAS may allow necessary modifications or alternative compliance in the manner it thinks fit. This can be valuable in edge cases (e.g., structural changes, translation issues, or information that does not map neatly to a prescribed template), but it remains discretionary.
3) Time limits for lodging documents when not otherwise specified (s 4). Section 4 addresses a common compliance problem: what happens when FSMA 2022 or the Regulations require a document to be lodged but do not specify a time period. The rule is default and practical—if the period is not prescribed or specified by MAS by written notice, the document must be lodged within 14 days after the occurrence of the event to which it relates. This default timeline applies to documents required under Part 9 of FSMA 2022 or under the Regulations.
For counsel, this provision is important for building internal compliance calendars. It also affects enforcement risk: failure to lodge within the required period can become a breach, even if the underlying substantive event (e.g., a change in information) was otherwise handled.
4) Fees are non-refundable and set out in the Schedule (s 5 and Schedule). Section 5 provides that fees specified in the third column of the Schedule are payable to MAS on a non-refundable basis in respect of matters set out opposite in the second column. This is a straightforward but significant commercial/legal point. Applicants and licensed entities should budget accordingly and ensure that fee payment is correctly matched to the relevant matter/form, because MAS can refuse acceptance if the fee is not accompanied with the form (s 3(4)(b)).
5) Licensing and ongoing compliance architecture (Part 2, Divisions 1–4). Although the extract provides only headings and the enacting formula plus s 2–5 in full, it clearly shows the structure of Part 2. Division 1 covers application for a licence (s 6), prescribed financial requirements under section 138(3)(e) of FSMA 2022 (s 7), and lapsing of licence (s 8). Division 2 addresses financial requirements while the licence is in force (s 9). Division 3 requires approval of key persons—chief executive officer, directors, partners, or managers of licensees (s 10). Division 4 requires an audit report (s 11).
From a practitioner’s perspective, this structure indicates that the Regulations are designed to ensure that digital token service providers meet minimum financial resilience standards at entry and maintain them during the licence period, that governance and accountability are anchored through MAS approval of key persons, and that independent audit oversight is built in through audit reporting requirements.
6) Practical implications of “base capital” and preference share qualification. The detailed capital definitions in s 2 are not academic. They directly influence whether a firm’s capital instruments qualify for regulatory capital purposes. For corporate structuring, this can affect how preference shares are drafted (e.g., dividend cancellation discretion, non-callability, and default triggers). Lawyers advising on funding, capital injections, or restructuring should treat these definitions as drafting constraints, not merely interpretive guidance.
How Is This Legislation Structured?
The DTSP Regulations 2025 are organised into two main parts in the extract:
Part 1 (Preliminary) contains: (i) the citation and commencement provision (s 1); (ii) definitions (s 2); (iii) forms and submission rules (s 3); (iv) default time limits for lodging documents (s 4); and (v) fees (s 5).
Part 2 (Licensing of Digital Token Service Providers) is divided into four divisions:
- Division 1: Application for licence (s 6), prescribed financial requirements (s 7), and lapsing of licence (s 8).
- Division 2: Conduct of business, including financial requirements while the licence is in force (s 9).
- Division 3: Approval of key persons (s 10).
- Division 4: Audit, including audit report requirements (s 11).
Finally, the Schedule sets out the fees payable to MAS. This schedule is operationally linked to s 3 (acceptance of forms depends on fee accompaniment) and s 5 (non-refundable basis).
Who Does This Legislation Apply To?
The Regulations apply to entities that seek or hold a licence under section 138 of FSMA 2022 for digital token service provider activities. In other words, the DTSP Regulations 2025 are primarily aimed at (i) applicants for a licence and (ii) licensed digital token service providers, including their governance and financial management arrangements.
They also indirectly affect persons who must be approved by MAS—such as chief executive officers, directors, partners, or managers of licensees—because the Regulations require MAS approval for these key roles. Accordingly, controllers and senior management should consider the Regulations when planning appointments, reorganisations, or changes in management.
Why Is This Legislation Important?
First, the DTSP Regulations 2025 provide the compliance “how-to” for the licensing regime. Even where FSMA 2022 sets the high-level legal requirements, the Regulations determine how applications are processed, what documents must be lodged and when, and how MAS can refuse acceptance. This matters because licensing outcomes can turn on procedural compliance as much as substantive eligibility.
Second, the Regulations embed financial resilience expectations through prescribed financial requirements and detailed capital definitions. The inclusion of complex definitions—such as the conditions for preference shares to qualify as “irredeemable and non-cumulative”—signals that MAS is concerned with the quality and permanence of capital, not just the nominal amount. For practitioners, this affects corporate structuring, treasury policies, and the drafting of shareholder instruments.
Third, the Regulations support ongoing supervision through financial requirements during the licence period, governance approvals for key persons, and audit reporting. In practice, this means that licensed entities must maintain systems for (i) monitoring capital adequacy, (ii) managing changes in key personnel, and (iii) producing audit reports on time. Section 4’s default 14-day lodging rule further underscores the need for robust internal compliance workflows.
Related Legislation
- Financial Services and Markets Act 2022 (FSMA 2022) — including section 138 (licensing) and the provisions referenced for regulatory powers
- Companies Act 1967 — definition of “financial year” (as referenced in s 2)
- Markets Act 2022 — referenced in the statute metadata (contextual/related framework)
Source Documents
This article provides an overview of the Financial Services and Markets (Digital Token Service Providers) Regulations 2025 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.