Wrap-Up Speech for 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

Introduction

1. Mr Deputy Speaker, I thank the 11 members who was speaking in support of the Bill. They raised many useful points which I will try to address.

A. MEs within Residential Areas

2. Let me start with Massage Establishments (MEs) within residential areas. Ms Foo Mee Har, Mr Melvin Yong, and Dr Fatimah Lateef who rightly pointed out that it is not a walk in the park. Mr de Souza said that Police should prioritise anti-vice enforcement efforts in residential areas. Mr Murali asked whether the Police will engage relevant stakeholders in deciding whether to grant new ME licences, and whether the Police will take into account land use considerations when assessing ME licence applications. Mr Desmond Choo suggested working with merchant associations to strengthen intelligence on illegal establishments, and gathering feedback on licensed MEs that flout the rules.

Zero tolerance approach towards vice in MEs

3. MHA understands and shares the underlying concerns of our MPs. Mr Kok Heng Leun said that "massage worker" refers to masseuses who provide "happy ending services" in massage parlours. He added that under the current Act, MEs can continue to operate even when they have been fined for being non-compliant. Let me correct that misconception.

4. Masseuses are not sex workers. Massage workers can earn a living without providing sexual services. That is the first thing we have to acknowledge. Not all masseuses are trying to provide additional services. They perform massage services, it is their livelihood and there is nothing untoward about that. I will state categorically that when it comes to vice and other illegal activities in MEs, Police has zero tolerance, especially in residential estates. The licenses are also liable to be revoked. So that is the baseline.

5. The Police and HDB take all feedback or complaints from residents and the community seriously. We will assess each feedback and take necessary actions to enforce our laws.

Multi-pronged approach towards managing numbers of, and potential dis-amenities from, MEs within residential areas

6. To mitigate the risks of vice and dis-amenities due to MEs, the Police take a much stricter licensing approach for MEs in residential areas compared to those that operate outside residential areas.

7. Firstly, when assessing a new ME application, the Police works closely with URA and HDB. The agencies will assess the suitability of the location. We will not allow new MEs in an area if the existing MEs are problematic, and pose law and order issues. The agencies will also assess whether the proposed ME will cause dis-amenities to the surrounding areas. In residential areas, we take into account feedback from the community. Clause 7(3) of the Bill now expressly specifies that the Licensing Officer must take into account URA's or HDB's planning considerations. This will ensure that the various agencies' processes are fully coordinated. They are not as coordinated as they need to be now, but Clause 7(3) of the Bill now makes that a requirement.

8. Secondly, even if a location in a HDB estate is assessed to be suitable for a ME, the licence applicant must meet more stringent qualifying criteria than if he planned to operate elsewhere. So, as some members have noted, licensed MEs in HDB estates must obtain what is known as a Category One licence under the Police licensing framework. What assurances does this give us? The more stringent criteria for Category One licences include the need to obtain CaseTrust accreditation which indicates good business practices, covering areas such as regulatory compliance, safety and hygiene, which Mr De Souza asked about, and consumer protection. Another criterion is a minimum capital investment of $50,000, which provides some deterrence against fly-by-night operators hoping to roll over quick profits of a ME. Such criteria help to ensure that the applicants are bona fide operators who have put in the effort and investment to run legitimate massage businesses.

9. Thirdly, the Police impose specific conditions to reduce the potential dis-amenities from MEs in residential areas.  Ms Foo Mee Har gave suggestions on more stringent licensing conditions that could be imposed on MEs situated within residential estates; several of these are already in place today. For instance, employees of licensed MEs are required to wear uniforms that are approved by the Licensing Officer. It is pretty strict. There is a uniform, it is approved. If you are not wearing the uniform, you have breached the licensing condition. So if you know of any instance where someone is not dressed appropriately, let us know and we will enforce. They are also prohibited from touting for business outside the ME premises. Mr Desmond Choo and Ms Foo Mee Har asked if the Ministry would consider limiting the operating hours of MEs located in housing estates. The Police have started to restrict the operating hours for MEs in HDB estates, and only allow them to operate from 6am to 11pm daily. This applies to licences granted or renewed since August this year. What about existing licenses? Under Clause 10 of the Bill, the Licensing Officer will be empowered to modify existing licence conditions and the restricted operating hours will be fully implemented for all licensees within HDB estates after the re-enacted Act comes into force. So, if you are in a HDB estate, once this new Act comes into force, the limited curtailed operating hours apply.

10. Mr Desmond Choo, Ms Foo Mee Har and Mr Melvin Yong highlighted concerns about inappropriate advertisements by MEs, and urged the Ministry to subject MEs to advertising guidelines. We understand the concerns. The Police intends to impose a new licensing condition to prohibit licensees from displaying indecent advertisements.  We will need some time to work out the specific details but the intent is clear: advertisements will have to be within certain guidelines.

Number of licensed MEs within residential estates with vice-related infringements, and whether they will be allowed to operate MEs in future

11. Mr Desmond Choo asked about the number of licensed MEs within residential estates with vice-related infringements, and whether they will be allowed to operate MEs in future.

12. In 2016, about 3% of licensed MEs in HDB premises were found to have vice-related infringements. If a ME has vice-related infringements, the licensee will no longer be considered fit and proper to hold a ME licence. The Licensing Officer will revoke the ME licence, and he will not be granted a new ME licence.

B. Levers against Unlicensed MEs and Those Involved In Illegal Vice Activities

13. Mr Deputy Speaker, I will next address the main problem we face in the ME industry today – the risks posed by a growing number of unlicensed MEs, many of which are fronts for vice activities.

Number of unlicensed MEs

14. Dr Fatimah Lateef asked about the number of unlicensed MEs in Singapore. In 2016, the Police detected close to 300 unlicensed MEs, which we already know is a 40% increase from 2013. So it's not to cause undue alarm. Let me clarify that the vast majority of these unlicensed MEs were found in non-HDB properties. A relatively small, 7% of the unlicensed MEs were found in HDB properties. To say it in another way, most unlicensed MEs were not in HDB properties and most licensed MEs in HDB properties did not have vice infringements; less than 3%. So we should not assume that all of them are somehow involved in vice.

Police's enforcement plans against unlicensed MEs and MEs with illegal vice activities

15. Ms Foo Mee Har, Mr Gan Thiam Poh, and Mr Louis Ng asked about the Police's enforcement plans against such unlicensed MEs.

16. We will not tolerate such errant operators that exhibit a flagrant disregard for the law. Where specific feedback is received about suspected unlicensed MEs and their illegal vice activities, the Police will assess the information and take necessary actions. The Police naturally have to work within their resource constraints, but the intention is to maintain the enforcement pressure against unlicensed MEs. To share with members, in 2016, on a monthly basis, Police carried out more than 100 enforcement checks. The Bill will provide Police with the levers to act more effectively against unlicensed MEs which take up a lot of time.

Low-risk MEs that are not required to be licensed may provide unlicensed massage services

17. Ms Foo Mee Har, Mr Melvin Yong, Mr Alex Yam and Mr Louis Ng cautioned that "low-risk activities" do not mean no risk, and you are worried that they are not required to obtain a ME licence and yet they could be fronts for illicit massage or vice activities.

18. The situation today is not quite like this, except for a small number of bad hats.  As I shared in my opening speech, vice activities are far more prevalent in unlicensed MEs, not even in those that are exempted.

19. We may be reducing regulatory costs for bona fide operators but they won't be getting a free pass to use their businesses as a façade for something else. If a business purports to be providing low-risk services like manicure and pedicure, but is in effect offering massage services, it will have to apply for a licence. If it fails to do so, the business will be treated no differently from any other unlicensed ME operators, and penalised.

Whether the revised fines for unlicensed MEs serve as sufficient deterrence

20. Ms Joan Pereira asked whether the revised fines for unlicensed MEs would serve sufficient deterrence, given the lucrativeness of their illicit activities.

21. We are doing more than raising fines. We are adopting a suite of measures that, as Mr de Souza puts it, gives the "extra teeth necessary" to clamp down on unlicensed MEs. First, the fines are significantly higher. More than that, the offenders can now face imprisonment. Second, should an unlicensed ME continue to operate even after the operator has been charged in court, Police can order the closure of premises. Third, we will go upstream to tackle the supply of premises, by taking irresponsible landlords to task, if they knowingly lease their premises to unlicensed ME operators.

22. Mr Desmond Choo asked if harsher penalties can be imposed on the landlords who repeatedly have such establishments operating on their premises. Indeed, this is our intent. Under Clause 5(4)(b), irresponsible landlords will be liable for fines up to $20,000 or 5 years' imprisonment or both, if they reoffend.

23. Ms Joan Pereira also said that convicted unlicensed ME operators should be disallowed from subsequently operating any beauty salons or health centres, given the ease with which these premises can be reconfigured for illicit vice activities.

24.    Given their history of non-compliance, convicted unlicensed ME operators who intend to run beauty salons or health centres that offer massage services will not be considered 'fit and proper' to hold a ME licence. So that's very clear. You tell us that you want to operate a ME and your track record is that you have been non-compliant, you have been convicted before, then you are not fit and proper. If they offer massage services without a license, then the same penalties as operating an unlicensed ME applies, even if they call it a beauty salon or health centre. It doesn't matter what you call it, we look at what actual activities are taking place.  But if Ms Pereira is suggesting that they be prevented from operating a bona fide beauty or health business, for example doing facials or selling organic supplements, then from a Yellow Ribbon perspective, and also comments from Mr Kok Heng Leun and Mr Louis Ng, that may be going too far.

Displacement of vice activities to residential areas

25. Some MPs spoke on tackling vice more generally, beyond MEs. Ms Joan Pereira is concerned about the possible displacement of vice activities to residential areas. She raised concerns that many of these vice workers are foreign nationals who have entered Singapore as visitors, and suggested that entry bans be imposed on foreigners involved in vice-related activities. Mr Kok Heng Leun asked about the Ministry's plans to ensure that vice does not happen where we do not want it to. Mr Alex Yam also asked about action that can be taken against masseuses found to be providing illegal sexual services.

26. Over the past five years, about 12% of offenders caught for abetting vice activities were involved in illegal brothels operating from HDB flats. An offender convicted of managing a brothel under the Women's Charter faces a fine of up to $10,000, or up to five years' imprisonment, or both.

27. The Police keep a close watch on the vice situation in Singapore, and will not hesitate to take the necessary enforcement actions to stamp out vice activities that spring up in residential areas.

28. In cases where Police have received complaints and detected brothels in HDB flats, Police will also investigate the owner of the flat. The Police will also notify the Housing Development Board, who will take stern action if the flat owner is found to have misused his flat, including imposition of fines, and possibly compulsory acquisition and debarment from buying another HDB flat quite stiff.

29. Mr Louis Ng and Mr Kok Heng Leun talked about the personal circumstances of Singaporean sex workers. Prostitution is not a crime per se and there is no intention to criminalise their actions in this Bill. But, for providing sexual services in a ME, the person will be cease to be 'fit and proper' and will no longer be allowed to work in a ME. For those who wish to transit to other types of work, I appreciate it really may not be easy for them but help is available and we are most willing to reach out to them.

30. Moreover, foreign nationals who are arrested for vice-related activities will have their work passes or visit passes cancelled. They will be removed from Singapore, and may not be allowed to re-enter.

C. Clarifications on Other Provisions within the Bill

31. Mr Speaker, I will now address queries on other provisions within the Bill.

Punish landlords who knowingly lease their premises to unlicensed ME operators

32. Mr Melvin Yong, Mr Alex Yam, and Mr Gan Thiam Poh sought clarifications about the proposal to punish landlords who knowingly lease their premises to unlicensed ME operators.

33.     I have addressed these points in my earlier speech. In summary, a landlord will know about the charge against his tenant through Police's notification. The landlord will not be caught in a situation where he is unaware. Once a person has been charged, we will inform them. After the tenant has been convicted of operating an unlicensed ME, the landlord must require the tenant to hand over possession of the premises within a month. Thereafter, the Bill allows the landlord to terminate the lease without any contractual liability. 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. If the landlord takes these steps to evict the tenant, the Police will not take action against him.

34. Mr Melvin Yong, Mr Alex Yam, and Mr Gan Thiam Poh suggested imposing additional obligations on landlords, such as placing the onus on landlords to proactively check whether their tenants have ME licences, putting in place sanctions on premises that have been used for vice activities, or confiscating such properties.

35. We do expect responsible landlords to check whether their tenants have valid ME licences, both before and during the tenancy agreement. However, this is not always possible. There could be mala fide unlicensed ME operators who mislead the landlord into believing that the premises will be used for legitimate businesses. Other tenants may decide to operate a ME midway through its tenancy agreement, without first informing the landlord. In such cases, it will not be fair to penalise the landlord. But, bear in mind also that egregious landlords can be imprisoned, which is likely a stronger deterrent than any sanctions on the property.

36. Mr Desmond Choo asked if the provision to penalise landlords who knowingly lease their premises to unlicensed ME operators can be extended to premises with licensed MEs that are involved in vice activities. He also asked whether termination of tenancy can be considered if the premise is a HDB commercial property.

37. In holding landlords responsible, we need to strike a balance. If the landlords have done their due diligence by leasing the premises to only licensed MEs, it may not be fair to take them to task for something that occurred within the licensed MEs which they are genuinely not aware of. In addition, as I have shared in my earlier speech, the incidence of vice in licensed MEs is significantly lower than that in unlicensed MEs. As such, the main problem that this provision seeks to tackle, is that of irresponsible landlords who have contributed to the problem of increased numbers of unlicensed MEs.

38. Nevertheless, if unlawful vice activities are detected within HDB commercial properties, HDB can take action to terminate the tenancy.

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

39. Mr Melvin Yong and Dr Fatimah Lateef raised the point that persons who are not 'fit and proper' may apply for the licence via a third party, such as a family member or friend with a clean record.

40. Clause 7 of the Bill seeks to address this by expanding the assessment of licensee suitability to other "relevant persons" in the business. At the point of licence application, Police will carefully screen the background of the applicant and other persons with influence over the business. If any relevant person is assessed to be not fit and proper, the Police will reject the licence application.  This seeks to prevent errant operators from hiding behind clean applicants to continue to operate MEs.  Members who have been in law enforcement know how difficult it can be to detect persons who deliberately hide. At least with this provision, the Police is clearly empowered to reject an application they suspect is being made by a bad hat operating behind the scenes. This will empower the Police to say we suspect this is not a clean applicant, someone is hiding behind this, the law says the Police cannot say I reject the application, whereas previously, it was left unsaid.

41. Dr Fatimah Lateef also surfaced concerns that after the licence has been granted, there may be illegal operations at the premises. The Police conducts regular enforcement checks to ensure that MEs comply with regulations. I shared earlier more than a hundred enforcement actions, a month. Licensed operators who run afoul of the law will face increased penalties under the Bill.

Powers to modify licence conditions

42. Mr Gan Thiam Poh suggested that MEs in buildings with higher concentration or recurrence of seedy MEs be required to install CCTVs along the corridors and entrances to deter illegal activities.

43.     Clause 10 of the Bill will allow Police to modify licence conditions to address this concern. Should licensed MEs pose law and order problems, the Police can intervene quickly and impose additional licensing conditions. One such condition could be the installation of CCTV cameras, to deter crimes in and around the ME, and to facilitate investigations into any such crimes that take place.

D. Other Queries or Suggestions Raised by MPs

44. Mr Deputy Speaker, let me deal with some other queries which have been raised.

Whether a Demerit Point System should be introduced for MEs

45. Mr Murali and Dr Fatimah Lateef asked whether we will consider a Demerit Point System for MEs, similar to that for the Public Entertainment (PE) licensing regime.  In a demerit point system, the licence infringements are less reprehensible and the offender is given several chances to avoid more serious consequences. Because of the kind of concerns that members have spoken about, we prefer a stricter regime for MEs and to serve notice that even a first infringement could attract very serious consequences, such as the immediate revocation of licenses.  Repeat offenders also face the risk of imprisonment. So I hope you see the comparison. This is stricter than a demerit point system – one strike and you could be out.

Ensuring that licensed MEs display licences

46. Mr Murali said that all licensed MEs should be made to display their licences, which would serve as a deterrence against the operation of unlicensed MEs and provide some form of consumer protection.

47. We agree. Today, under the licensing conditions, ME licensees are already required to prominently display the ME licence within the ME premises, to ensure that patrons and inspecting officers can easily identify licensed MEs. Failure to comply with this requirement is a breach of the licensing conditions, and licensees will face stiff penalties under the updated regulatory regime.  What I can also share with members that in fact Police have taken operators to task for failing to display their licence.

Ensuring that ME employees meet minimum professional qualifications

48. Ms Foo Mee Har, Mr Melvin Yong, and Mr Gan Thiam Poh said that all masseuses hired at licensed MEs should meet minimum professional qualifications.

49. Today, in deciding whether to grant a ME licence or to grant written approval for an individual to work in a ME, the Licensing Officer already considers whether employees possess the necessary recognised qualifications or certifications. This is made clear in Clauses 7(3) and 15(1) of the Bill. In other words, not any one is allowed to work in a massage establishment. There are criteria, 'fit and proper', an assessment of your qualifications. Of course, if you do not have those, then you are in breach and the operator is also in breach and you take them to task.

What constitutes a "good track record"

50. Mr Melvin Yong asked for a clearer definition of what constitutes a "good track record" that will entitle licensees to a longer licence validity period.

51. By "good track record", we refer to compliant operators without any adverse records or infringements over several years.

Activities that will be exempted from obtaining a licence

52. Mr Murali asked whether existing exemptions will continue under the updated regulatory regime. Mr Alex Yam asked if TCM services will be covered under the Act, while Mr Louis Ng mentioned that the current amendment does not cover TCM clinics.

53. The principle remains unchanged. We will continue to exempt MEs that are assessed to be providing low vice risk activities. These include outlets where treatment is personally administered by a registered medical professional, so if you have a  shop front that says "TCM clinic", you go inside, the practitioner has got a registration under the TCM practitioners' act, that is issued by the TCM board, and that medical professional personally administers the treatment, that can be exempted but not otherwise. Not otherwise if you are not personally administering the treatment, ie. you have got someone else doing it, or if in fact you call yourself a TCM practitioner but you do not have a licence, you do not have a registration with the TCM board. Then, we can also exempt open concept massage establishments, where everything is within visibility. Nothing is behind closed doors, no curtains, you can see everything that is going on in the premises – that is what is known as open concept massage establishment. Now Mr Muralli asked about Ayurvedic treatments. I do not think they can, if they do not take place in an open concept, have a premise, then they need to get the licence. They cannot say "We do not want licence", "We are not high risk". They need to get a licence because it is not open concept, we cannot see what is going on so they need a licence.

E. Partnering the Industry

54. Dr Fatimah Lateef suggested that we work with the industry trade associations for the upcoming implementation of this Bill.

55. MHA has consulted the Spa Association Singapore, the Spa & Wellness Association of Singapore, and the Real Estate Developers' Association of Singapore, and obtained their strong support for the proposals under this Bill.

Conclusion

56. Mr Deputy Speaker, I hope I have addressed members' concerns.  The Massage Establishments Bill is important in ensuring that our regulatory regime continues to remain effective and relevant.  But as Dr Fatimah Lateef reminded us, it is not a walk in the park – there remains a lot of work to be done. You know from what I said earlier – advertising requirements, some of the other licensing conditions, all of these, we would have to proceed to implement. But with the support of the House, Mr Deputy Speaker, I beg to move.