LTA amends Road Traffic Act to facilitate ERP 2.0 transition

With projected changes to the transport rules first announced in January 2026, LTA has now confirmed that the Road Traffic Act has been amended to facilitate transition to the ERP 2.0 system.

This means that from 1 January 2027, all Singapore-registered motor vehicles must have the ERP 2.0 system’s On-Board Unit (OBU) installed to travel on public roads in Singapore.

And from 15 February 2026, vehicle owners who have been invited to install the OBU but have yet to do so will receive a final reminder from LTA. They will then be given the next three months from the date of issuance of the final reminder to install the OBU for free. If not, they will have to pay $35 and $70 for the installation of the OBU in motorcycles and other vehicles respectively.

From 1 January 2027, all Singapore-registered motor vehicles must have the ERP 2.0 system's OBU installed to travel on public roads in Singapore

Unauthorised OBU-related services such as installation, manufacture, modification, repositioning, removal, repair, and advertising are liable to be punished, with serious cases likely to receive penalties of up to $20,000 or imprisonment for a term not exceeding 12 months, or both.

Additionally, the MOT and LTA will exempt certain vehicles from the installation of the OBU, with existing Classic or Vintage Vehicle (CVV) owners given the option of installing a free OBU in they prefer (subject to technical feasibility assessment). From 1 January 2027, CVV vehicles that do not have the OBU installed will be subjected to a flat-rate ERP fee ($3 for motorcycles, $10 for all other vehicles) for every ERP operational day that the vehicle travels on Singapore roads.

And as previously mentioned, LTA will decriminalise missed ERP payments and treat them as an administrative matter. From 1 January 2027, vehicle owners, rather than drivers, will be responsible for settling outstanding ERP charges. Vehicle owners who fail to do so within the grace period of five days from LTA's SMS notification will be unable to transact with LTA until the missed charge and a $10 administrative fee are paid.

From 1 January 2027, vehicle owners, rather than drivers, will be responsible for settling outstanding ERP charges

Vehicle owners who do not settle outstanding ERP payments within the grace period will be denied access to vehicle services such as renewal of road tax and the use and encashment of Preferential Additional Registration Fee rebate and COE residual.

The announcement also mentions the increase of penalties for the illegal alteration of motor vehicles, with the aim of deterring workshops from permitting such instances on their premises. Individuals face fines of up to $20,000 or imprisonment for a term not exceeding two years or both. Penalties are doubled for repeat offenders. For non-individuals, first time offenders can be fined up to $40,000 and $80,000 for repeat offenders.

Penalties for keeping or using unregistered/ deregistered vehicles have also been enhanced to be commensurate with the severity of such an offence. Offenders can be fined up to $20,000 and/or jailed up to two years for the first offence, with penalties doubled for repeat offenders.

These enhanced penalties will take effect from 27 February 2026.