The enhanced guidelines aim to eliminate misleading or speculative claims on overseas property investment advertisements, says Advertising Standards Authority of Singapore, amid a rising number of complaints.
SINGAPORE: From mid-August, enhanced guidelines on advertisements for property investment advertisements will take effect.
The new guidelines for all media platforms aim to eliminate advertising claims that are speculative, misleading, or cannot be substantiated, said Advertising Standards Authority of Singapore.
Singaporeans are one of the top real estate buyers in Asia, according to the Consumers Association of Singapore (CASE). The association said overseas property purchases by Singaporeans have risen significantly in recent years, with more foreign properties being advertised in Singapore.
On the other hand, CASE said it has seen an increase in the number of complaints related to such transactions. Since 2013, it has received 23 complaints, mostly where consumers did not get promised returns on their foreign investments.
Meanwhile, Advertising Standards Authority of Singapore said it has received 41 complaints in the last two and a half years, relating to advertisements on financial products and services, including foreign property investments and investment training seminars. The consumer watchdog said advertisements promise high, guaranteed returns, but lack sufficient warnings against risks.
“We want to ensure that the consumers are not given false hope,” said Mr Seah Seng Choon, executive director at CASE. “For example, the higher returns investors put in their advertisement has to be substantiated. The main objective is really to ensure that advertisements are legal, accurate and ethical. In a nutshell, we want to see transparency in their disclosure and the advertisements should reflect the factual information that consumers should receive. ”
The enhanced guidelines are being recommended by the Advertising Standards Authority of Singapore, an advisory council under CASE. They are aimed at raising the standards of disclosures such as warnings, and qualifications, so that potential investment risks are sufficiently highlighted to investors.
With the changes, advertisements for overseas properties must clearly state information relating to the development and features of the property, as well as potential ownership restrictions and tax liabilities. While the enhanced guidelines may keep investors better-informed, observers said investors, too, need to be careful of where they plan to park their funds.
Said Mr Wong Sui Jau, retirement planning ambassador for iFast Financial: “If you have a situation where they’re making all kinds of promises and implied returns so you get the impression (that) this investment instrument can give you a huge return, there must be a certain amount of risk involved. Either the underlying market is risky, or there may be some of these issues like legal tax which you are probably not aware of.”
The enhanced guidelines will kick in on Aug 12. Advertisers and media owners with contracts signed prior to the effective date will be given a three-month grace period until Nov 11 to fulfil existing contractual requirements and adhere to the enhanced guidelines.
Advertisers who fail to comply will be asked to revise their advertisements or withdraw them altogether. They may also risk losing advertising space and even face negative publicity following investigation by authorities.