Statute Details
- Title: Gas (Gas Importer’s Licence) (Exemption) Order 2018
- Act Code: GA2001-S12-2018
- Legislation Type: Subsidiary Legislation (SL)
- Authorising Act: Gas Act (Cap. 116A)
- Enacting Authority: Energy Market Authority of Singapore (EMA), with approval of the Minister for Trade and Industry (Industry)
- Enacting Provision: Made under section 8 of the Gas Act
- Citation: No. S 12
- Commencement: In force from 1 January 2018
- Expiry: Ends at 2359 hours on 28 January 2040 (as reflected in the legislation timeline)
- Key Operative Provision: Section 2 (Exemption)
What Is This Legislation About?
The Gas (Gas Importer’s Licence) (Exemption) Order 2018 is a targeted regulatory instrument made under the Gas Act (Cap. 116A). In plain terms, it creates a narrow exemption from the licensing requirement applicable to certain gas importers—specifically, persons importing liquefied natural gas (LNG)—so long as they meet defined contractual and operational conditions.
Under the Gas Act framework, importing gas is generally regulated through licensing. The exemption order modifies that baseline by disapplying a particular licensing provision (section 6(1)(h) of the Gas Act) for qualifying importers. The policy rationale is pragmatic: it allows certain market participants to import LNG without being caught by the relevant licensing prohibition, provided they have secured storage and send-out arrangements with Singapore LNG Corporation Pte Ltd and have not previously failed to consume or send out LNG within the required timeframe.
Importantly, the exemption is not open-ended. It is time-bound (commencing 1 January 2018 and expiring on 28 January 2040) and is conditional. It also excludes “ineligible persons”, including certain existing licence holders and certain electricity licence holders, thereby preventing regulatory arbitrage and ensuring that the exemption does not undermine the licensing regime.
What Are the Key Provisions?
1. Citation and commencement (Section 1)
Section 1 provides the formal name of the Order and sets out its temporal operation. The Order is in force starting on 1 January 2018 and ending at 2359 hours on 28 January 2040. For practitioners, this matters for compliance timing: LNG import arrangements and any reliance on the exemption should be assessed against whether the relevant import occurred during the Order’s active period.
2. The exemption from section 6(1)(h) of the Gas Act (Section 2(1))
The core operative rule is in section 2(1). It states that section 6(1)(h) of the Gas Act does not apply to any person (subject to the “not being an ineligible person” limitation) that satisfies three cumulative conditions:
- (a) Imports LNG — the person must be importing LNG.
- (b) Has a qualifying contract with Singapore LNG Corporation Pte Ltd — on the date of the LNG import, the person must have a contract with Singapore LNG Corporation Pte Ltd for storage and send-out of the LNG. The contract must commence no later than the import date and must not exceed 12 months, including any extension or renewal.
- (c) No failure to consume or send out within 12 months — the person must not, in respect of any LNG previously imported by the person (imported on or after 1 January 2018) to which sub-paragraph (b) applies, have failed to consume or send out the LNG within 12 months after the date of import.
In practical terms, the exemption is designed to support LNG importers who have secured the necessary infrastructure access (storage and send-out) through Singapore LNG Corporation Pte Ltd and who demonstrate operational reliability. The 12-month “consumption or send-out” condition functions as a compliance safeguard: it prevents repeat importers from benefiting from the exemption if they repeatedly fail to move the LNG through the system within the contractual and regulatory timeframe.
3. Definition of “ineligible person” (Section 2(2))
Section 2(2) defines an “ineligible person” for the purposes of the exemption. The exemption does not apply to any person that falls within any of the following categories:
- (a) Gas licence holders — a person that holds a licence mentioned in section 7(3)(a), (b) or (f) of the Gas Act.
- (b) LNG importing licence holders — a person that holds a licence mentioned in section 7(3)(h) of the Gas Act for importing LNG.
- (c) Electricity licence holders — a person that holds a licence mentioned in section 9(1)(b), (ba), (e) or (g) of the Electricity Act (Cap. 89A).
This exclusion is significant. It indicates that the exemption is intended for a specific class of importers who are not already operating within certain regulated licensing categories. From a legal risk perspective, counsel should not assume that “not having an LNG importer’s licence” is sufficient; the analysis must also consider whether the person holds other relevant gas licences or electricity licences that would render them “ineligible”.
4. Interaction with prior imports (Section 2(1)(c))
The “previous failure” condition is particularly important. It applies only to LNG previously imported by the person that was imported on or after 1 January 2018 and that falls within the contract condition in section 2(1)(b). This means the compliance history is anchored to the Order’s commencement date. Practitioners should therefore track LNG import dates and ensure that records of consumption/send-out performance are maintained for at least the relevant period.
How Is This Legislation Structured?
The Order is very short and consists of two provisions:
- Section 1 (Citation and commencement): identifies the Order and sets the start and end dates of its operation.
- Section 2 (Exemption): provides the substantive exemption from section 6(1)(h) of the Gas Act, sets out the qualifying conditions for LNG importers, and defines “ineligible persons”.
Although the Order is concise, it relies on cross-references to the Gas Act and the Electricity Act. For legal interpretation, those cross-references are essential: the exemption’s scope depends on how the referenced licensing provisions are structured and what categories of licences they cover.
Who Does This Legislation Apply To?
The exemption applies to “any person” importing LNG, but only if that person is not an “ineligible person” and satisfies the three conditions in section 2(1). The phrase “any person” is broad and can include companies and other legal entities, provided they are the importer of LNG and can demonstrate compliance with the contractual and operational requirements.
However, the Order’s practical applicability is constrained by the ineligible-person exclusions. In particular, persons holding certain gas licences (including licences for importing LNG) and certain electricity licences are excluded. Therefore, the exemption is best viewed as a compliance pathway for a specific subset of market participants rather than a universal relaxation of licensing rules.
Why Is This Legislation Important?
This exemption order is important because it affects how LNG importers structure their regulatory compliance and commercial arrangements. For counsel advising on LNG supply chains, the Order creates a conditional route to avoid the application of section 6(1)(h) of the Gas Act. That can influence contracting, timing of imports, and the selection of counterparties for storage and send-out.
From an enforcement and risk-management standpoint, the Order also imposes a clear performance expectation: the importer must not fail to consume or send out LNG within 12 months after import, for LNG imported on or after 1 January 2018 under qualifying storage/send-out contracts. This means that compliance is not merely “paper compliance” (having a contract) but also “operational compliance” (meeting consumption/send-out timelines). Practitioners should ensure that internal systems can track these milestones and that evidence is available to demonstrate compliance if questioned by the regulator.
Finally, the ineligible-person exclusions underscore that the exemption is not intended to be used by already-licensed participants to circumvent the licensing regime. For legal practitioners, this requires careful licence mapping: a client’s existing gas and electricity licences must be reviewed against the specific categories listed in section 2(2). Failure to do so could lead to reliance on an exemption that is legally unavailable.
Related Legislation
- Gas Act (Cap. 116A) — in particular section 6(1)(h), section 7(3) and section 8 (power to make orders)
- Electricity Act (Cap. 89A) — in particular section 9(1)(b), (ba), (e) and (g) (licence categories that render a person “ineligible”)
Source Documents
This article provides an overview of the Gas (Gas Importer’s Licence) (Exemption) Order 2018 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.