These will boost Singapore’s efforts to stay known as a clean financial hub.
In two weeks, the amended law governing companies will come into effect, boosting Singapore's ongoing efforts of maintaining its reputation as a trusted and clean financial hub.
According to senior minister of state for law and finance Indranee Rajah, one of the key amendments is improving the transparency of companies.
"The first set of amendments seeks to make the ownership and control of business entities more transparent and thus reduce opportunities for the misuse of corporate entities for illicit purposes. This will help Singapore to better meet the recommendations of the Financial Action Task Force or FATF," she said.
The two changes under this category include the registers of controllers, members, and nominee directors. The other is the requirement of locally incorporated companies and foreign companies registered in Singapore to maintain registers of their controllers at prescribed places.
Another key amendment is reducing regulatory burden and improving the ease of doing business in Singapore. Three key changes will be in effect. One will be the inward re-domiciliation regime.
"Inward re-domiciliation is akin to changing 'corporate citizenship'. Transfer of registration will thus be useful to foreign corporate entities that wish to retain their corporate history and identity. Foreign corporate entities may choose to re-domicile for various reasons, such as for a more conducive regulatory framework or to be closer to their shareholders or operational base. A foreign corporate entity that is re-domiciled to Singapore will be required to comply with the requirements of the Companies Act like any other Singapore company," she explained.
Rajah said these transparency-related amendments will enable Singapore to better mitigate the risks of money laundering and financing of terrorism. The Bill will also reduce the regulatory burden on companies and improve corporate governance in Singapore.
There will also be changes in requirements on annual general meetings and annual returns. Moreover, there will be a removal of the requirement for a common seal to execute documents such as deeds and for certain documents such as share certificates.
Rajah also stated there will be an amendment of the debt restructuring framework, citing recent high-profile cases including Hanjin Shipping’s attempted rehabilitation in Korea and ongoing efforts for Singapore-listed businesses like Swiber and Ezra.
With this, she said there will be changes in the schemes of arrangement, highlighting key provisions such as Moratorium, Rescue Financing, Cram Down Provisions, and Pre-Packs.
"The enhanced debt restructuring framework will give business entities in financial difficulties greater flexibility to restructure and survive. Together with the new inward re-domiciliation regime, these amendments will increase our competitiveness and strengthen Singapore as a leading financial centre," she concluded.
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