"When you look at other countries in the region it's hard to see anyone immediately breathing down the neck of Singapore and Hong Kong," said John Ure, executive director of AIC. "But things can change. Five to 10 years is not a long time."
Singapore has attracted major internet companies to its shores in part because of its commitment to what it has called a "light touch" when it comes to policing the Web.
Yahoo's popular Singapore news site was the only foreign website among the 10 listed by the MDA, but critics fear the rules could be extended to cover other websites, including those critical of the government.
A senior official at the Ministry of Communications and Information (MCI) responsible for the ruling, Permanent Secretary Aubeck Kam, told a gathering of the Singapore Computer Society on Thursday that the rules would not cover commentary sites, and that the government had never ordered removal of content because it was critical of the government under existing regulations.
"Monsters under the bed"
The new rules will come under scrutiny later on Monday, with the opposition Workers' Party tabling questions such as how authorities would treat online news services catering to Singapore's large financial sector and individual Facebook pages with large followings.
A Yahoo spokesman said it had no official comment on the regulation but that the AIC's position was "broadly consistent with ours".
Rights groups have joined local bloggers in criticising the move. Phil Robertson, deputy director of Human Rights Watch's Asia division, said that major internet companies adding their voice should give Singapore serious pause about its approach.
The government, "like a little boy in a dark bedroom, imagines that every bump in the night means there are monsters under the bed ready to pounce on Singapore's much vaunted social stability", he said.
Ure said the coalition's members had been unnerved by the announcement coming "out of the blue" at a time when it had been holding discussions with the Singapore government on several Internet-related issues.
The regulations, he said, "muddied the waters" and that "anything that is seen to be a hindrance to the free flow of content and data" was of concern to his members.
"It's particularly concerning to the AIC that Singapore should appear to be giving the wrong signal, and countries around the region that are far less open and liberal might take their cue from Singapore," he said.
Singapore has defended the revision to its regulations, and professed surprise at the opposition.
Kam, the MCI official, said that such concerns would likely be accommodated via consultations with the 10 websites over the wording of the licenses. "There is no need to read signals because we are communicating what we think," he told Ure during a question and answer session at the computer users' gathering.
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