Jurisdiction - Singapore
Reports and Analysis
Singapore – Fifth Round Of Securities And Futures Act Amendments Take Effect.

13 October, 2012


Legal News & Analysis – Asia Pacific – Singapore – Regulatory & Compliance




The Securities and Futures (Amendment) Act 2009 was passed by Parliament on 19 February 2009, heralding a host of changes to the Securities and Futures Act (“SFA”). The amendments have taken effect in several stages, with the latest set of amendments coming into force on 1 October 2012 and 19 November 2012, pursuant to the Securities and Futures (Amendment) Act (Commencement Notification) 2012.




Disclosure of interests


The main changes under the under the new disclosure regime include:


(a) consolidating the disclosure requirements for listed corporations, business trusts and real estate investment trusts (“REITs”) under the SFA. Previously, the disclosure requirements for listed corporations and REITs were under the Companies Act and the SFA while those for business trusts were under the Business Trusts Act;


(b) no longer requiring directors and substantial shareholders to separately report their interests, and changes in interests, in securities to the SGX. Instead, such disclosure will be to the listed entity and the listed entity will be required to announce this information as soon as possible and no later than the end of the following business day;


(c) extending the notification requirements to CEOs who are not directors;


(d) extending the notification requirements for directors and substantial shareholders to report their interests or changes in interests, which currently apply only to Singapore-incorporated listed companies, to foreign-incorporated corporations with a primary listing on the SGX;


(e) extending the notification regime to managers of REITs and business trusts such that a shareholder of the manager of a REIT or business trust will be required to give notification when his shareholdings in the manager reaches, crosses or falls below threshold levels of 15%, 30%, 50% and 75%. Any acquisition or disposal of interest in the securities of the REIT or business trust by the manager must also be disclosed;


(f) introducing electronic forms for use by directors, CEOs and substantial shareholders / unitholders, and introducing changes to the SGXNet announcement template to allow the listed entity to attach the electronic notification form directly for dissemination; and


(g) introducing a stiffer penalty of up to $250,000 and/or imprisonment for a term not exceeding two years for material contraventions which are committed intentionally or recklessly with the possibility of civil penalties for such flagrant breaches.


Attribution of liability


New provisions introduce a concept of attributed liability whereby an employer which is corporation, a partnership or a limited liability partnership may face liability resulting from a contravention of market conduct provisions of the SFA by its employee, officer, partner or manager if it has either consented to or connived in the contravention, or been negligent as to its internal compliance policies and procedures.


Remedy of disgorgement


A new remedy of disgorgement has been provided for, under which an “innocent” third party to a market misconduct offence may be made to pay any gains he has received into the courts.


The provisions for civil liability have also been amended such that the quantum of such disgorgement is to be deducted from the amount of compensation that a contravening person is liable to pay a claimant under a market misconduct offence. This is to prevent a claimant from being over compensated.


Foreign business trusts


A new regime for the recognition of foreign business trusts has been established. The new provisions enable the Monetary Authority of Singapore (“MAS”) to recognise a foreign business trust if MAS is satisfied of certain matters. Such provisions also require MAS to give an applicant for recognition an opportunity to be heard if MAS proposes to refuse any application.




Some of the more salient amendments made in the previous rounds include:


(a) imposing new conditions for invoking small offers, private placement and restricted offer exemptions for offers of shares, debentures, collective investment schemes or business trusts;


(b) providing for the compulsory acquisition of minority units in a REIT where an acquirer of REIT units may now require dissenting unitholders to sell their units to him if he is able to acquire 90% or more of the units in the REIT (excluding those units already held by him);


(c) enabling a minority unitholder in a REIT to bring an action for minority oppression similar to the action a minority shareholder may bring under the Companies Act; and


(d) introducing a continuing licensing regime for capital markets services (“CMS“) licence holders and a new representative notification framework for representatives of CMS licence holders and entities exempt from holding CMS licenses under the SFA.




Please click on the links below to refer to the relevant documents:


1. Securities and Futures (Amendment) Act 2009

2. Securities and Futures (Amendment) Act (Commencement Notification) 2012

3. Securities and Futures (Disclosure of Interests) Regulations 2012



For further information, please contact:


Gary Pryke, Managing Director, Drew & Napier 

[email protected] 


Petrus Y S HuangDirector, Drew & Napier

[email protected]


Eric Chan, Director, Drew & Napier 

[email protected]


Ralph Lim, Director, Drew & Napier 

[email protected]






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