The MAS has published two consultation papers with proposals to enhance safeguards for prospecting and marketing of financial products. MAS’ proposals seek to enhance existing safeguards and introduce new measures to strengthen market conduct. particularly with the resumption of roadshows and the increasing use of social media and other digital media for prospecting and marketing activities.
The proposals regarding (i) prospecting activities at public places and via telemarketing and (ii) prospecting activities via digital applications and social media are separately set out in each of the two consultation papers. For physical prospecting at public places, the proposals include: making existing safeguards such as the disclosure of representatives’ identities and the financial institutions they represent mandatory, limiting the conduct of prospecting activities to commercial premises; requiring financial institutions to provide customers with additional time to consider whether to make a purchase, and limiting the use of gift offers which may influence decision-making. For digital marketing, the proposals include: strengthening controls over online advertisements to avoid misleading content, and tightening practices when appointing third party service providers to generate leads online.
It is proposed that amendments will be made to the Guidelines on Standards of Conduct for Marketing and Distribution Activities (“Guidelines”) issued by the MAS on 23 December 2016 to include new practices relating to prospecting activities at public places and that new Notices will be issued by MAS to legislate these enhanced safeguards following feedback on the consultations. The proposed safeguards for digital marketing are set out in draft Guidelines on Standards of Conduct for Digital Prospecting and Marketing Activities set out in the consultation paper. It is proposed that the new Notices and revised Guidelines for prospecting activities at public places and via telemarketing and the new Guideline on Standards of Conduct for Digital Prospecting and Marketing Activities will be effected six to nine months from their issuance date.
The consultation papers may be accessed at the links on this page. If you require assistance to provide feedback on the proposals, please reach out to our Financial Services Regulatory team.
Our Financial Services Regulatory (FSR) Practice advises on a broad range of issues that concern FIs. Reach out to our FSR Partners Elaine Chan, Rosabel Ng, Chan Jia Hui, Tian Sion Yoong, or find out more about our practice here.