Suspension Archives - MARKETECH APAC

Singapore – The Monetary Authority of Singapore (MAS) has directed e-commerce platform Qoo10 to suspend all payment services regulated under the ‘Payment Services Act 2019’ in Singapore, following numerous customer complaints regarding significant delays in processing payments.

Effective immediately, the suspension order does not prevent Qoo10 from operating its e-commerce platform; however, the company may need to enlist a third-party payment service provider to facilitate transactions on the platform.

Between April and August 2024, MAS and other government agencies received several customer complaints against Qoo10 for delays in processing payments to these customers, who are merchants on Qoo10’s e-commerce platform. Qoo10 was asked to address these complaints, and while some were resolved, others remained outstanding.

In early September 2024, Qoo10 notified MAS that a substantial number of merchants would experience payment delays. In response, MAS engaged with Qoo10’s management to address these issues and conveyed serious concerns regarding the situation.

On September 14, The Straits Times (ST) reported that the Singapore Police Force has started investigating complaints filed against Qoo10 and its logistics partner, Qxpress. According to vendors who spoke to ST, Qoo10, which operates in Malaysia, Indonesia, Japan, and Hong Kong, has allegedly failed to make timely payments.

ST also reportedly reviewed documents indicating that vendors using Qxpress for shipping goods to and from Singapore have been facing delays since July.

In an official statement, MAS said, “MAS provided opportunities to Qoo10 to remedy these concerns and required the company to take steps to satisfy MAS that it would be able to meet its obligations to merchants on an ongoing basis, including engaging a third-party payment service provider to offer the covered services.”

However, to date, Qoo10 has failed to provide adequate assurance of its resources and systems to meet its payment obligations to merchants in a timely manner, prompting the financial regulatory authority to issue the suspension order.

“MAS has had to carefully consider the potential disruption the suspension could cause to Qoo10’s e-commerce platform or other services that are integrated with the covered payment services,” MAS explained.

“However, permitting Qoo10 to continue providing covered payments services would expose more merchants using Qoo10’s covered payment services to risks of larger outstanding obligations and potential losses. Qoo10 will be permitted to make payments to satisfy outstanding claims by such merchants but may not take on new payment obligations,” MAS added.

According to MAS, the suspension will only be reconsidered when Qoo10 demonstrates its ability to effectively resolve the payment delays and ensure the ongoing protection of its customers’ interests in Singapore.

It is important to note that when the PS Act was introduced on 28 January 2020, existing payment service providers were granted exemptions to continue their services while their license applications were under review by MAS, ensuring that these services remained uninterrupted. While Qoo10 is not licensed by MAS, it was allowed to continue offering payment services during the review process of its application.

MAS advises merchants facing payment delays to raise their concerns with Qoo10. If these issues remain unresolved, merchants are encouraged to use established commercial dispute resolution processes, including filing a civil claim. Additionally, those experiencing cash flow difficulties due to these delays should reach out to participating financial institutions listed on Enterprise Singapore’s website to apply for the Enterprise Financing Scheme (working capital loan).

According to ST, reports of Qoo10’s issues first surfaced in July, revealing that TMON and WeMakePrice—two South Korean e-commerce platforms owned by Qoo10—had failed to pay their vendors, leading to an investigation by South Korean authorities.

In addition, reports in August indicated that Qoo10 had reduced its workforce in Singapore by approximately 80%. The Ministry of Manpower announced that the Taskforce for Responsible Retrenchment and Employment Facilitation is monitoring the company’s retrenchment efforts.

Singapore – The Monetary Authority of Singapore (MAS) has imposed a six-month pause of DBS Banks’ non-essential services in order to allow the bank to focus more on the essential service of restoring its system resilience, following a slew of prolonged outages and disruptions in the bank’s systems.

Suspended non-essential services include acquiring new business ventures during this period or reducing the size of its branch and ATM networks in Singapore.

The imposed pause was the result of when MAS directed DBS to conduct a third-party independent review of the bank’s systems back in April this year. Through the review, they identified several shortcomings on the bank’s systems which included system resilience, incident management, change management, and technology risk governance and oversight.

Following the independent review, DBS Bank has set out a technology resiliency roadmap to address the shortcomings, improve system resilience, and better position the bank to meet future digital banking needs. The roadmap is being implemented in phases, with the changes affecting its system architecture design taking more time to complete.

Moreover, MAS will review the progress made by DBS Bank on its remediation efforts at the end of six months. MAS may extend the duration of the measures, vary the additional capital requirement currently imposed, or take further actions at that point.

Ho Hern Shin, deputy managing director for financial supervision at MAS, said, “DBS must put in place immediate measures to ensure service reliability while it continues to invest in the longer-term efforts to bolster its operational resilience. We have imposed this six-month pause on the bank to give it the space to take the actions needed to maintain customer trust.”

Following the said statement, DBS has issued an official apology related to its series of digital disruptions, while promising that a roadmap that includes measures to strengthen technology governance, people/leadership, systems and processes is now rolling.

DBS Chairman Peter Seah said, “The Board apologises for the digital banking disruptions. When customers bank with us, they expect to be able to access our banking services conveniently, and at any time of the day. With the incidents of the past year, we have failed to live up to these expectations, and have also fallen short of our own standards. As an acknowledgement that the bank could have done better, senior management will be held accountable, and this will be reflected in their compensation.”

He added, “Over the past few months, the bank has been making every effort possible to strengthen our resiliency and business continuity, and to be able to recover more quickly when incidents happen. This is a work in progress, and we seek customers’ patience as we work through our remedial actions.”

Sri Lanka – French sporting goods retailer Decathlon has announced that it will indefinitely suspend its retail and e-commerce operations in Sri Lanka by October 30 this year, following import concerns amidst the current social unrest in the country.

Decathlon first operated in the country in October 2018 and has operated two stores, as well as an e-commerce store.

In a Facebook statement, Decathlon said that its production activities in Sri Lanka will continue to operate as normal.

“We would like to thank all of our customers and partners for the good will and support they have shown since we first opened our doors. The welcome reserved for our concept and our products was amazing and we sincerely hope to restart our retail activities in Sri Lanka when circumstances permit,” the company said.

They also added that it will also relocate its production sites and its employees, as well as providing financial and return-to-employment support to its employees moving outside the company.

Decathlon’s suspension of operations in Sri Lanka follows the ongoing economic crisis in the country, with Sri Lanka facing its worst economic crisis since 2019. This resulted in the recent Sri Lankan protests that resulted in the government declaring a state of emergency and the resignation of Mahinda Rajapaksa as the prime minister.

Bangkok, Thailand – Cryptocurrency exchange company Huobi has announced that it is shutting down its operations in Thailand by July 1 this year after failing to secure a licence in the country, as well as a new statement from Thailand’s Securities and Exchange Commission delisting Huobi.

In an online statement, Huobi said that by 1 July, the Thai operations are no longer legally affiliated with the Huobi Group and its affiliates. It also encouraged its local users to withdraw their funds from the exchange.

“Since September 2021, we have been trying to contact all clients to withdraw their assets,” the statement said, while also urging other users to contact the exchange via email or Telegram for refund requests.

According to the newest statement from Thailand’s SEC, Huobi was found to have ‘flawed management structure and system’ between February and March 2021. Which, as per the Thailand Securities and Exchange Commission, was not sufficient to ensure compliance with required regulations, leading to its licence suspension’.

“The SEC, at its meeting No. 15/21, held on September 2, 2021, therefore resolved to recommend to the Minister of Finance. to consider revoking the licence to operate a cryptocurrency exchange trading centre and Huobi’s digital token trading centre, and ordered Huobi to suspend its services as a digital asset trading centre,” the SEC statement read.

The update is in line with Thailand’s recent strict guidelines on cryptocurrency use, stating that they are meant to avert potential impacts on the country’s financial stability and economic system.

New York, USA – Global advertising company The Interpublic Group of Companies (IPG) is the latest advertising company that has announced its exit from the Russian market following the Ukrainian crisis caused by Russian invasion.

In a public letter posted by its CEO Philippe Krakowsky on LinkedIn, he stated that they immediately applied all international sanctions and informed clients in Russia who are prohibited parties that they would no longer continue working with them. Krakowsky also added that since IPG never owned a media business in Russia, they did not have significant concerns that their media buying was either fueling the local economy, or funding media being used by the state.

“As you know, we are first and foremost a company that always strives to live up to our values. We believe in speaking up against oppression, whether that has to do with issues of race, or on behalf of other marginalised communities, and speaking up on behalf of democratic principles. We’re committed to initiatives that support sustainability. And we have always been clear that we value and stand by our people and their well-being,” he said.

The Interpublic Group of Companies is composed of five major networks namely FCB, IPG Mediabrands, McCann Worldgroup, MullenLowe Group, and Marketing Specialists.

Krakowsky also added that they will leave their Russian team, approximately around 200 of them, with enough capital on their balance sheet to pay their people for a minimum of six months.

He further said that they will also be engaging with the team in the coming weeks, as they cede control of all aspects of management and operations to the local leadership team, in order to ensure continuity for any non-Russian clients who remain active in the market.

“We have always been clear that we value and stand by our people and their well-being. That’s core to our culture, since the nature of our business requires that we have the industry’s best talent – and that we each act as part of an interconnected global network, showing up for each other and working together for the common good,” Krakowsky said.

IPG is the latest advertising group to exit the Russian market after WPP previously announced that it will be discontinuing its work in Russia. Outcry in the advertising industry has been rampant regarding the crisis, including a statement from the renowned award-giving event Cannes Lions, which said that it has banned Russian entries and delegates for this year’s awards ceremony.

Manila, Philippines – The Association of Accredited Advertising Agencies of the Philippines or known as 4As Philippines has announced the suspension of local creative agency GIGIL’s membership, slated for one year.

This follows after the agency came under fire with the campaign they made for medical-aesthetic clinic Belo Medical Group.

According to 4As Philippines, said ad was found to be in violation of certain terms in their association’s code of ethics.

The ad, titled ‘Pandemic Effect’ features a woman watching a barrage of news while her appearance changes: the skin under her eyes darkens, gets acne, grows facial and body hair, and gains weight. As the ad draws to a conclusion, the woman in focus receives a call from her friend, and catches up with one another.

The ad closes off with the tagline ‘Tough times call for beautiful measures’, alongside a line to encourage customers to book an appointment with Belo Medical Group.

Following the ad release, many netizens have criticized the ad, stating that it was ‘tone deaf’ and body-shamed women in the middle of the pandemic.

Both Belo and GIGIL have taken the ads out of their social media channels by 10 August.

In a statement regarding the 4As Philippines suspension, GIGIL posted on Facebook, “We acknowledge that alongside the unexpected thinking that comes with our work, we must always be mindful of sensitivity and respect.”

They added, “We also assure that this does not in any way hamper our ability to represent and deliver work for clients. Our business continues.”

MARKETECH APAC has reached out to both GIGIL and Belo Medical Group for additional comments.

GIGIL has been known for creating humorous and tongue-in-cheek campaigns for brands such as Julie’s Bakeshop, Unioil, and Allianz. They are also responsible for multiple campaign drives for Netflix Philippines as part of the promotion of the Filipino-based occult series ‘Trese’.