Statute Details
- Title: Financial Services and Markets (Freezing of Assets of Persons — Yemen) Regulations 2023
- Act Code: FSMA2022-S238-2023
- Legislative Type: Subsidiary legislation (SL)
- Authorising Act: Financial Services and Markets Act 2022
- Enacting Authority: Monetary Authority of Singapore (MAS)
- Citation: S 238/2023
- Commencement: 28 April 2023
- Status: Current version as at 27 March 2026
- Primary Purpose: Implement UN Security Council sanctions measures under Resolution 2140 (2014) by requiring asset freezes for “designated persons” linked to Yemen
- Key Provisions: Regulation 5 (asset freezing), Regulation 6 (duty to provide information), Regulation 7 (revocation), Regulation 8 (saving and transitional provisions)
What Is This Legislation About?
The Financial Services and Markets (Freezing of Assets of Persons — Yemen) Regulations 2023 (“Yemen Freezing Regulations”) are Singapore’s legal mechanism for implementing targeted financial sanctions mandated by the United Nations Security Council. In particular, the Regulations are designed to give effect to UN Security Council Resolution 2140 (2014), which established measures including the freezing of funds and other economic resources belonging to, or controlled by, persons and entities designated by the UN sanctions committee.
In plain terms, the Regulations require financial institutions in Singapore to identify whether they hold or control any funds, financial assets, or economic resources belonging to “designated persons” on the UN List. If they do, they must freeze those assets immediately and ensure that the frozen resources are not made available—directly or indirectly—to or for the benefit of the designated person.
The Regulations also create an information and reporting obligation. Financial institutions must promptly notify MAS where they possess or control relevant assets, or where they have information about transactions involving such assets. This supports enforcement and enables MAS to request further details and, where appropriate, to consider whether exceptions apply.
What Are the Key Provisions?
1. Definitions and the “designated person” concept (Regulation 4)
The Regulations hinge on the UN sanctions framework. “Committee” refers to the UN Security Council Committee established under paragraph 19 of Resolution 2140 (2014). “Resolution” and “UN List” refer to the relevant UN Security Council resolutions and the evolving list of designated individuals and entities maintained by the Security Council or the Committee.
“Designated person” is defined as an individual or entity set out in the UN List, subject to specific timing conditions. The Regulations treat a person as designated with effect from the date immediately following their addition to the UN List; they cease to be designated with effect from the date of removal; and modifications to particulars take effect from the date immediately following the modification. This matters operationally: institutions must ensure their screening and compliance processes can respond quickly to list updates.
2. Mandatory freezing of assets (Regulation 5)
Regulation 5 is the core obligation. Subject to limited exceptions in Regulation 5(3), any financial institution that has in its possession, custody, or control in Singapore any funds, other financial assets, or economic resources owned or controlled, directly or indirectly, by a designated person must do two things immediately:
- (a) Freeze all such funds, financial assets, or economic resources; and
- (b) Prevent availability of those resources to or for the benefit of the designated person, whether directly or indirectly.
Regulation 5(2) expands the reach of the freeze by treating as owned or controlled by the designated person certain assets held through intermediaries. In particular, funds held by an entity owned or controlled (directly or indirectly) by a designated person, or funds held by an individual or entity acting on behalf of or under the direction of a designated person, are treated as belonging to the designated person for freezing purposes. For practitioners, this is a critical “control” and “acting on behalf” extension that reduces the ability to evade sanctions through corporate structures or nominees.
3. Exceptions and permitted uses (Regulation 5(3))
The Regulations recognise that some payments may be necessary even where assets are frozen. However, the exceptions are not automatic; they depend on determinations by MAS. Regulation 5(3) provides that the freezing requirement does not apply to funds or resources that MAS has determined are necessary for:
- Basic expenses (including foodstuff, rent, mortgage discharge, medicine, medical treatment, taxes, insurance premiums, and public utility charges);
- Exclusively certain professional and routine costs, including reasonable professional fees and reimbursement of expenses for legal services, and fees/service charges for routine holding or maintenance of frozen assets;
- Extraordinary expenses (again, subject to MAS determination); and
- Judicial, administrative or arbitral liens or judgments—where the lien or judgment arose or was entered before 26 February 2014 and is not for the benefit of a designated person.
For compliance teams, the practical takeaway is that any “release” or use of frozen funds outside the narrow permitted categories requires MAS engagement. Institutions should not assume that ordinary banking operations (for example, interest accrual or contractual payments) are exempt; they must check whether MAS has made the relevant determination and whether the transaction falls within the permitted framework.
4. Interest, earnings, and pre-existing contractual payments (Regulation 5(4))
Regulation 5(4) allows a financial institution to credit to an account frozen under Regulation 5(1) either:
- interest or other earnings due on the account; or
- payments due under any contract, agreement or obligation that arose before 6 March 2015.
However, the crediting is not a full release. The provision expressly states that such interest, earnings, or payments are still subject to the freezing obligation in Regulation 5(1). In other words, the institution may process accruals and certain contractual entitlements administratively, but it must ensure the credited amounts remain frozen and are not made available to the designated person.
5. Duty to provide information (Regulation 6)
Regulation 6 imposes immediate notification duties. Every financial institution must immediately inform MAS if it has possession, custody, or control in Singapore of relevant funds or resources owned or controlled by a designated person. It must also notify MAS if it has information about any transaction or proposed transaction involving such assets.
Beyond initial notification, the institution must provide any further information relating to the assets or the transaction that MAS may require. This is an important enforcement tool: it enables MAS to monitor compliance, assess whether exceptions should be granted, and determine whether further regulatory or investigative action is needed.
6. Revocation and transitional continuity (Regulations 7 and 8)
Regulation 7 revokes the earlier MAS regulations: the Monetary Authority of Singapore (Freezing of Assets of Persons — Yemen) Regulations 2015 (G.N. No. S 109/2015). This ensures the 2023 Regulations become the operative legal instrument.
Regulation 8 provides continuity. Funds frozen under Regulation 5(1) of the revoked Regulations are treated as frozen under Regulation 5(1) of the new Regulations. Any MAS determinations under the revoked Regulation 5(3) that were in force immediately before 28 April 2023 are treated as determinations under the new Regulation 5(3). Similarly, information already provided under the old Regulation 6 is treated as having been provided under the new Regulation 6, and any further information requirements are treated as requirements under the new Regulation 6. This avoids compliance gaps during the transition.
How Is This Legislation Structured?
The Yemen Freezing Regulations are concise and structured around eight provisions:
- Regulation 1 (Citation and commencement): sets the name and the effective date (28 April 2023).
- Regulation 2 (Object): states the purpose—implementing UN Security Council Resolution 2140 (2014).
- Regulation 3 (Application): applies the Regulations to all financial institutions in Singapore.
- Regulation 4 (Definitions): defines key terms including “Committee,” “designated person,” “funds,” “Resolution,” and “UN List,” and explains when a person becomes designated (or ceases to be designated) based on UN List updates.
- Regulation 5 (Assets to be frozen): sets the mandatory freeze obligation, expands it to controlled/indirect holdings, and provides MAS-determined exceptions and limited permitted credits.
- Regulation 6 (Duty to provide information): requires immediate notification to MAS and ongoing provision of requested information.
- Regulation 7 (Revocation): revokes the 2015 Yemen freezing regulations.
- Regulation 8 (Saving and transitional provisions): preserves the effect of existing freezes, determinations, and information submissions.
Who Does This Legislation Apply To?
Regulation 3 provides that the Regulations apply to all financial institutions in Singapore. While the extract does not reproduce the definition of “financial institution,” the legislative context is the Financial Services and Markets Act 2022 framework, under which “financial institution” typically captures a broad range of regulated entities (for example, banks, insurers, and other entities providing financial services). Practitioners should confirm the exact statutory definition in the FSMA 2022 and any relevant subsidiary instruments to ensure full coverage.
The obligations in Regulations 5 and 6 are triggered by possession, custody, or control in Singapore of relevant assets, or by having information about relevant transactions. This means that even if the designated person is not the direct account holder, the freeze may still apply where the institution holds assets that are owned or controlled (directly or indirectly) by the designated person, including through entities owned/controlled by the designated person or through persons acting on their behalf or under their direction.
Why Is This Legislation Important?
The Yemen Freezing Regulations are significant because they translate UN targeted sanctions into enforceable Singapore obligations. For financial institutions, the Regulations create a clear compliance baseline: screen, identify, freeze immediately, and prevent access. The “immediately” requirement in Regulation 5(1) and the “immediately inform” requirement in Regulation 6 mean that institutions must have operational processes capable of acting quickly when the UN List changes or when a match is identified.
From a legal risk perspective, the Regulations also address common sanctions-evasion techniques. The expanded treatment of assets held by controlled entities and by persons acting on behalf of designated persons reduces the effectiveness of nominee arrangements and complex ownership structures. The MAS-determined exceptions further underscore that institutions must not treat sanctions compliance as purely mechanical; rather, they must engage with MAS where a payment is claimed to be necessary (basic expenses, extraordinary expenses, or certain legal/judicial lien scenarios).
Finally, the transitional provisions in Regulation 8 are practically important. They ensure that freezes and MAS determinations made under the 2015 Regulations continue without interruption after the 2023 revocation. This reduces the risk of inadvertent non-compliance during regulatory changeovers and supports continuity in case management, recordkeeping, and audit trails.
Related Legislation
- Financial Services and Markets Act 2022 (authorising Act)
- Markets Act 2022 (listed in metadata; practitioners should confirm any cross-references relevant to the sanctions regime)
- UN Security Council Resolution 2140 (2014) (the international measure implemented by these Regulations)
- Monetary Authority of Singapore (Freezing of Assets of Persons — Yemen) Regulations 2015 (revoked by Regulation 7)
Source Documents
This article provides an overview of the Financial Services and Markets (Freezing of Assets of Persons — Yemen) Regulations 2023 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.