Second Reading Speech of The Massage Establishments Bill 2017 - Speech by Mrs Josephine Teo, Minister, Prime Minister’s Office, Second Minister for Home Affairs and Second Minister for Manpower

A. Introduction

1. Mr Speaker, I beg to move, "That the Bill be now read a second time".

2. The Massage Establishments Act regulates massage establishments ( MEs ), by licensing the operators and imposing conditions on their activities.

3. The aim is to prevent MEs from being used for vice activities, or causing law and order problems.

4. MHA has reviewed the ME regulatory regime to ensure that it remains effective in the changing landscape. Under the enhanced regime:

a. We will take tougher action against unlicensed MEs.

• There is a clear case for action.

• Between 2013 and 2016, there was a 40% increase in the number of unlicensed MEs detected by the Police.

• Many of these were not in fact MEs but fronts for vice activities, the proverbial "wolf in sheep's clothing" or what in Chinese we refer to as "挂羊头卖狗肉".

b.     For licensed MEs, we will take a more calibrated approach.

• Today, we have about 1,200 licensed MEs that are sited both within residential and non-residential areas.  About 300 or one quarter are found in HDB housing estates. They include reputable MEs that have been operating for a long time.

• The evidence is that there is a clear difference between licensed and unlicensed MEs.  In 2016, Police enforcement found less than 3% of licensed MEs to have vice-related infringements. This is significantly lower than the 40% of unlicensed MEs with vice-related offences.

• Even as we tighten the regulations on higher-risk activities, and take stricter and more punitive action against errant operators, there is room to lighten the regulatory burden for the vast majority of low-risk and compliant operators who are meeting a genuine demand for massage services.  This differentiated approach will also allow Police to focus its resources accordingly.

5. Given the substantial amendments to the Massage Establishment Act, the Ministry of Home Affairs ( MHA ) will repeal the existing Act and re-enact it. All existing licences granted under the current Act will continue to be in force, but they will be treated as granted under the new Act, and subject to the new regulatory regime.

B. Key Clauses in Bill

B1. Strengthen Levers against Unlicensed MEs

6. I will first explain the provisions to strengthen the Police's levers against unlicensed MEs.   We will use a combination of measures to more effectively deter and penalise those who are involved in unlicensed ME operations.

Increase penalties for unlicensed MEs

7. Today, the penalty for unlicensed ME operations is a maximum fine of $1,000. This is grossly insufficient compared to the profits that unlicensed MEs can make, especially by engaging in vice activities.

• Clause 5 of the Bill increases the penalty for operating unlicensed MEs to a maximum fine of $10,000 or 2 years' imprisonment or both.

• For repeat offenders, the punishment will increase to a maximum fine of $20,000 or 5 years' imprisonment or both.

• The significantly higher fines and the inclusion of imprisonment as a punishment will be a stronger deterrent.

8. If the unlicensed ME also engages in vice activities, the operator can be liable for additional vice-related offences under the Women's Charter.

Premises closure order

9. The enhanced penalties will ensure that unlicensed ME operators face serious consequences upon conviction .

• However, court proceedings take time, especially if the unlicensed operator claims trial.

• There have been cases of unlicensed operators blatantly continuing to operate even after being charged in court, due to the lucrativeness of their illegal activities.

10. To address such behaviour, Clause 19 will empower the Commissioner of Police to issue a premises closure order.

• This power will be used if the Police have reasonable grounds to suspect that despite ongoing criminal proceedings, the operator continues to operate the unlicensed ME.

• The premises closure order will require the unlicensed ME premises to be vacated within a specified time and physically secured thereafter.

• If the order is not complied with, the Police is empowered to take necessary steps, or use reasonable force, to enforce the closure of the premises.

11. Under Clauses 20 and 21, any person who breaks the lock or enters the premises without prior permission from the Police, will be deemed to have breached the order.

• The person could face a maximum fine of $15,000 or 3 years' imprisonment or both.

12. The premises closure order is intended to only prevent the continued operation of illegal activities, and will not penalise usage of the premises for legitimate businesses. Clause 19 therefore sets out the circumstances under which the order will be lifted.

13. In addition, under Clause 22, the accused may appeal to the Minister against the Commissioner's premises closure order, but the order will remain in force during the appeal process.

Punish landlords who knowingly lease their premises to unlicensed ME operators

14. The Bill will also deal with the upstream problem of irresponsible landlords who knowingly lease their premises to unlicensed ME operators.

15. We will require landlords to evict tenants who have been convicted of unlicensed ME operations, and provide them with early notice.

• The Police will notify the landlord when their tenant is charged in court for operating an unlicensed ME.

• This is a legal requirement under Clause 28. Landlords will therefore have no reason to be unaware of their tenants' illegal activities.

16. After the tenant has been convicted of operating an unlicensed ME, under Clause 29, the landlord must require the tenant to hand over possession of the premises within a month.

• There is typically some time between the tenant being charged in court and conviction.

• As such, the early notification under Clause 28 will give landlords sufficient lead time to make the necessary preparations.

17. We recognise that some tenants could be difficult to deal with, and may not leave despite the landlord's request. In these cases, the landlord is expected to take the following steps to discharge his obligations under the Bill.

• If the tenant refuses to hand over possession of the premises within a month, the landlord is empowered under Clause 29 to terminate the lease or tenancy without being liable for breach of agreement with the occupier.

• Thereafter, if the tenant still refuses to move out, the landlord should apply to the Magistrate's Court for a summary order for the delivery of possession of the premises. There will be penal consequences for the tenant if he refuses to vacate the premises.

• If the landlord has taken these steps, he will have fulfilled his obligations and no action will be taken against him.

18. Otherwise, the Police will take action against the landlord for the offence of allowing his premises to be used for operating an unlicensed ME under Clause 5. This offence carries the same penalties as the offence of operating an unlicensed ME.

B2. Reduce Regulatory Burden for Compliant Licensed MEs but Take Errant Ones to Task

19. The second set of amendments will refocus the regulatory regime on higher-risk activities, and reduce the regulatory costs on low-risk activities and compliant MEs. At the same time, we will enhance levers and powers available to the Police to deal with errant ME licensees.

Revise definition of "massage"

20. The current definition of "massage or special treatment" under the Massage Establishments Act includes manicure, light treatment for hair removal, fish spas and baby spas.

• Such activities do not pose the same law and order concerns as traditional MEs offering body massages in private rooms.

• MHA will amend the definition of "massage" so that these activities no longer require a licence. This will reduce the regulatory costs for such businesses.

• However, if any person provides massage services under the guise of such low-risk activities, they will face the increased penalties for unlicensed ME operators.

Keep unsuitable persons out of the massage industry

21. We will also introduce a suite of measures to keep unsuitable persons out of the massage industry.

Expand assessment of licensee suitability to other "relevant persons" in the business

22. Under the current regime, the Licensing Officer assesses the fitness and propriety of an applicant or licensee, when deciding whether to issue or revoke a licence.

23. Under Clauses 7 and 12, MHA will expand this assessment to include other "relevant persons", besides the applicant or licensee, who can influence the decisions of the business.

• These "relevant persons" include the "responsible officers" of the business entity as defined in Clause 2, and all persons with substantial interest in, or have control or direction over, the business.

• If the applicant, licensee or "relevant persons" are not fit and proper, the Licensing Officer can refuse to issue a ME licence, and revoke an existing one.

24. This will reduce the risk of MEs being started or operated by persons who are unfit or improper but are hiding behind a veil of propriety. The Police will publish the criteria and requirements for applicants, licensees and "relevant persons" on their website at a later date.

Suspension powers when licensee or "relevant persons" have been charged for serious offences

25. Under Clause 11, the Licensing Officer can immediately suspend a ME licence when the licensee or a "relevant person" has been charged in Court for serious offences that will be specified in the schedule of the Act.

• Examples of these serious offences include vice-related offences under the Women's Charter, as well as offences relating to trafficking-in-persons and organised crime.

26. This allows the Police to take immediate action to prevent the licensee from using the ME premises for such serious crimes, without having to wait for the potentially lengthy court proceedings to be concluded.

• Under Clause 12, when the licensee or "relevant person" is subsequently convicted of the scheduled serious offences, the Licensing Officer will then proceed to revoke the ME licence.

Powers to grant and cancel approval for ME employees

27. The licensee is also required to seek the Licensing Officer's approval before hiring an employee. Not doing so will be an offence under Clause 13.

28. Employees who are not fit and proper will not be allowed to work in a ME.

• The fit and proper criteria for ME employees will be set out in the subsidiary legislation at a later stage.

• For example, if any employee has any involvement with vice activities, or has been convicted of serious offences such as outrage of modesty, he or she will not be allowed to work in the ME.

29. The licensee or employee may appeal to the Minister against the Licensing Officer's decision, but the decision will remain in force pending the outcome of the appeal.

Enhance the Police's Powers to Take Swift and Effective Action

30. We have also enhanced the Police's powers to take swift and effective action against errant licensees.

Powers to modify licence conditions

31. Clause 10 creates a new provision to allow the Licensing Officer to modify licence conditions, in order to intervene promptly against problems and dis-amenities associated with MEs.

• For example, if a licensed ME poses law and order problems, the Licensing Officer may decide to curtail its operating hours for the remaining duration of its licence term.

32. Clause 10 prescribes the process for modifying licence conditions, which is straightforward and I will not go into here.

Powers of forced entry

33. The Police have encountered cases where MEs lock their doors to obstruct or delay enforcement.

34. Clause 24 empowers Licensing Officers and Police Officers to enter ME premises using necessary force and without a warrant, if there is reasonable suspicion that offences under the Act are being, or have been, committed within.

Appointment of authorised persons

35. Clause 4 of the Bill allows the Licensing Officer to appoint suitably-trained individuals, such as Auxiliary Police Officers or retired Police Officers, as "authorised persons".

• This will provide the Police with deployment flexibility and allow them to conduct more frequent checks.

36. Authorised persons will be empowered under Clause 23 to enter and inspect ME premises. Under Clause 26, authorised persons can request for records, accounts, and other information relating to the ME for purposes of compliance checks.

• Authorised persons, however, will not be given the more specialised powers that the Licensing Officer and Police Officers have, for example, powers of investigation and the new power of forced entry.

Protection from personal liability

37. Clause 30 protects Licensing Officers, Police Officers and authorised persons from personal liability, as long as they have acted in good faith and executed their duties with reasonable care.

Increase penalties for regulatory breaches

38. Finally, we will also increase the penalties for regulatory breaches, so as to deter and penalise errant licensed operators. The penalty today for all regulatory breaches is a maximum fine of $1,000.

• We will increase the penalty for regulatory breaches to a maximum fine of $5,000 for first-time offenders.

• Repeat offenders will face a maximum fine of $10,000 or 2 years' imprisonment or both.

C. Support from Industry

39. As part of the review, MHA consulted the Spa Association Singapore, the Spa & Wellness Association of Singapore, and the Real Estate Developers' Association of Singapore, on the proposed amendments.

40. The industry associations and their members are supportive of the proposals under the Bill. The Bill allows tougher action to be taken against unlicensed operators and errant licensees, who damage the image of the massage industry.

D. Conclusion

41. Mr Speaker, please allow me to conclude my speech in Mandarin.

42. 这项"按摩院法案"(Massage Establishments Bill) 将授权警方对违法的按摩院业者采取更严厉的执法行动；同时，对于按规矩经营的业者，这项法案也将适度放宽管制。

43. 我前面提到，无照经营的按摩院从2013年到2016年增加了百分之四十，当中许多是挂羊头卖狗肉，暗地里从事非法活动。这项法案将通过几个方面赋予警方更大的权力，来取缔这些无照经营的按摩院。

44. 第一，这项法案将对无照经营按摩院施以更严厉的刑罚。第二，在被控上法庭后，如果业者还执意继续无照经营按摩院，警方将有权下令按摩院关闭。第三，对于在知情的情况下还将店面出租给无照按摩院的商店业主，警方会追究责任。

45. 对于持有经营执照的按摩院，过去的案例明显反映他们犯罪的倾向相对低.  因此, 这项法案将集中管制风险较高的按摩活动，也为此推出几项新的管制措施。比如，为了确保有执照的按摩院都由适当人士经营，警方将不止评估执照申请者和执照持有人是否适宜妥当，也会审核其他幕后的推手。

46. 内政部对"按摩院法令"所提出的这些修订条款，将加强我们对按摩院的管制框架。

47. 谢谢！