Statute Details
- Title: Securities and Futures (Collective Investment Scheme) (Excluded Arrangements) Notification 2018
- Act Code: SFA2001-S853-2018
- Type: Subsidiary Legislation (SL)
- Authorising Act: Securities and Futures Act (Cap. 289) (“SFA”)
- Notification Number: S 853
- Enacting Authority: Monetary Authority of Singapore (MAS)
- Enacting Provision: Made in exercise of powers under paragraph (xii) of the definition of “collective investment scheme” in section 2(1) of the SFA
- Citation and Commencement: Comes into operation on 25 December 2018
- Key Provisions:
- Section 1: Citation and commencement
- Section 2: Excluded arrangements (sets out what is not a “collective investment scheme” for the purposes of the SFA definition)
- Status: Current version as at 27 March 2026
What Is This Legislation About?
The Securities and Futures (Collective Investment Scheme) (Excluded Arrangements) Notification 2018 is a short but practically significant MAS Notification. Its core function is to clarify that certain types of financial arrangements do not fall within the statutory definition of a “collective investment scheme” (CIS) under the Securities and Futures Act (SFA).
In plain language, the Notification addresses a classification question: when does an arrangement that involves pooling or investment-like features count as a CIS, and therefore trigger the regulatory framework for CISs? The SFA’s CIS definition is broad, but it contains carve-outs. This Notification is one of those carve-outs: it specifies particular arrangements that are excluded from being treated as CISs for the relevant purpose in the SFA definition.
The Notification focuses on two categories of arrangements: (i) securitisation transactions, and (ii) arrangements consisting only of the issuance of structured notes. By excluding these from the CIS definition, the Notification reduces regulatory uncertainty and helps market participants structure transactions without inadvertently triggering CIS licensing or prospectus requirements that would otherwise apply to CISs.
What Are the Key Provisions?
Section 1 (Citation and commencement) is straightforward. It provides the short title and confirms that the Notification comes into operation on 25 December 2018. For practitioners, this matters for determining whether the exclusion applies to transactions executed on or after the commencement date, and for assessing any regulatory filings or compliance steps taken around that time.
Section 2 (Excluded arrangements) is the substantive provision. Section 2(1) states that, for the purposes of paragraph (xii) of the CIS definition in section 2(1) of the SFA, each of the following arrangements is not a collective investment scheme:
(a) a securitisation transaction; and
(b) an arrangement that consists only of an issuance of structured notes.
This is a legal classification rule. If an arrangement fits within one of these categories, it is excluded from the CIS definition (at least for the specific definitional pathway referenced by paragraph (xii)). The practical effect is that the arrangement should not be treated as a CIS, and therefore should not attract the CIS regulatory regime that would otherwise apply to CISs under the SFA.
Section 2(2) (Interpretation provisions) defines key terms by reference to other parts of the SFA. Specifically:
- “securitisation transaction” has the meaning given by section 262(3) of the SFA.
- “structured notes” has the meaning given by section 240AA(5) of the SFA.
For legal work, this cross-referencing is crucial. The Notification does not create standalone definitions; instead, it imports the statutory meanings from the SFA. A practitioner must therefore analyse the transaction against those definitions in the SFA to confirm that the arrangement truly qualifies as a “securitisation transaction” or as an issuance of “structured notes”.
Scope nuance: “consists only of” structured notes. The wording in section 2(1)(b) is deliberately narrow: the arrangement must consist only of an issuance of structured notes. This suggests that if the arrangement includes additional features beyond the issuance of structured notes—such as additional pooling mechanisms, collective participation rights, or other elements that could be characterised as a CIS—then the exclusion may not apply. In practice, lawyers should review the full transaction documentation (offering documents, subscription agreements, trust deeds, underlying asset arrangements, and investor rights) to ensure that the arrangement is truly limited to structured notes issuance.
Scope nuance: exclusion is tied to paragraph (xii) of the CIS definition. The Notification operates “for the purposes of paragraph (xii) of the definition of ‘collective investment scheme’ in section 2(1) of the Act”. This indicates that the SFA’s CIS definition is structured with multiple paragraphs, and paragraph (xii) is a pathway that allows MAS to exclude certain arrangements by notification. Practitioners should therefore confirm how paragraph (xii) interacts with other paragraphs in the CIS definition, particularly where an arrangement might arguably fall within other CIS limbs even if it is excluded under this Notification.
How Is This Legislation Structured?
The Notification is structured as a short instrument with an Enacting Formula and two operative sections:
- Section 1: Citation and commencement (sets the effective date).
- Section 2: Excluded arrangements (lists the categories and provides interpretive cross-references).
There are no schedules, no detailed conditions, and no procedural requirements in the text provided. The Notification’s legal work is done through its classification rule and its incorporation of definitions from the SFA.
Who Does This Legislation Apply To?
This Notification applies to market participants and transaction structures that could otherwise be characterised as a “collective investment scheme” under the SFA. In practice, the main affected parties are:
- financial institutions and issuers involved in securitisation transactions;
- issuers, arrangers, and distributors of structured notes;
- law firms and compliance teams advising on whether a product is regulated as a CIS.
It does not directly impose obligations on investors. Instead, it affects how the SFA’s regulatory framework is triggered for certain arrangements. If an arrangement is excluded from the CIS definition, the parties may not need to comply with CIS-specific requirements (subject to the rest of the SFA and any other applicable regulatory regimes).
Because the exclusion is tied to statutory definitions in the SFA, applicability depends on the substance and legal form of the arrangement. Lawyers should therefore treat the Notification as a starting point for classification, not as a substitute for a full legal analysis of the transaction against the SFA definitions of securitisation transactions and structured notes.
Why Is This Legislation Important?
Although the Notification is brief, it has meaningful consequences for regulatory classification. The CIS concept is a cornerstone of Singapore’s capital markets regulation: where an arrangement is a CIS, it can trigger licensing, disclosure, and conduct requirements designed to protect investors and ensure market integrity. By excluding securitisation transactions and certain structured note issuances, MAS is effectively recognising that these products—when structured within the statutory definitions—should not be treated as CISs.
From a practitioner’s perspective, the Notification reduces uncertainty and supports transaction efficiency. Securitisation and structured notes are common instruments in global markets, and they often involve complex legal structures. Without clear exclusions, issuers might face heightened compliance burdens or delays while assessing whether their offerings fall within the CIS definition. This Notification provides a clearer regulatory pathway for at least two categories of arrangements.
Enforcement and compliance implications follow from classification. If a transaction is incorrectly treated as a CIS (when it is excluded), parties may incur unnecessary regulatory costs and delays. Conversely, if a transaction is incorrectly assumed to be excluded (for example, because it does not truly “consist only of” structured notes, or because it does not meet the SFA definition of a securitisation transaction), the parties could face regulatory risk for misclassification. Therefore, the Notification should be used alongside careful document review and definitional analysis.
Finally, the Notification illustrates MAS’s approach to tailoring the CIS regime. Rather than applying a one-size-fits-all test, the SFA definition includes mechanisms for excluding arrangements that, while investment-like, are regulated through other frameworks or are not intended to be captured by CIS regulation. This helps maintain proportionality and ensures that regulatory attention is focused where it is most needed.
Related Legislation
- Securities and Futures Act (Cap. 289) — in particular:
- Section 2(1) (definition of “collective investment scheme”, including paragraph (xii))
- Section 262(3) (definition of “securitisation transaction”)
- Section 240AA(5) (definition of “structured notes”)
- Futures Act — listed in the provided metadata (relevant only to the extent it appears in the platform’s cross-references; the Notification itself is made under the SFA)
- Legislation Timeline / MAS legislative updates — for confirming the correct version and any subsequent amendments
Source Documents
This article provides an overview of the Securities and Futures (Collective Investment Scheme) (Excluded Arrangements) Notification 2018 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.