Public Consultation on the review of the Companies Act & regulatory framework for foreign entities

Detailed description

1. The Ministry of Finance (MOF), together with the Accounting and Corporate Regulatory Authority (ACRA) which administers the Companies Act, invite the public to provide feedback on the "Report of the Steering Committee to Review the Companies Act". MOF and ACRA also invite the public to provide feedback on the review of the regulatory framework for foreign entities in Singapore. The public consultation exercise will run from 20 June 2011 to 16 September 2011.

Steering Committee's report

2. The Steering Committee was set up by MOF in October 2007 to carry out a fundamental review of the Companies Act. The review is aimed at ensuring an efficient and transparent corporate regulatory framework that supports Singapore’s growth as an international hub for both businesses and investors.

3. In its review, the Steering Committee considered existing legislation in leading jurisdictions such as Australia, New Zealand, the United Kingdom and the United States. The Steering Committee recommended that the Companies Act should contain core company law, while provisions relating to specific types of companies (e.g. foreign companies) should be in legislation specifically dealing with such entities. The Steering Committee also consulted key stakeholders before finalising its recommendations. Six consultation papers were issued to businesses, professional bodies, individuals who practise or are interested in corporate law and corporate finance, as well as other stakeholders. The Steering Committee received 128 written comments and held 17 focus group meetings to hear oral comments.

4. The Steering Committee's Report, comprising six chapters and 217 recommendations, is at Annex A [PDF, 3.1 MB] and the highlights of its recommendations are at Annex B [PDF, 111 KB].

Review of the regulatory framework for foreign entities

5. The Companies Act contains provisions relating to foreign companies. The Steering Committee took the view that the laws relating to the registration and regulation of foreign entities, namely branches of foreign corporations registered in Singapore, should be placed in separate legislation to facilitate the streamlining of the Companies Act. There is no intent for any significant widening of the scope of regulation for foreign entities. The proposed standalone legislation will not regulate the operations of subsidiaries (incorporated in Singapore) of foreign companies, which will continue to be regulated under the Companies Act.

6. ACRA’s consultation paper on the review of the regulatory framework for foreign entities is at Annex C [PDF, 502 KB] and the highlights of ACRA's recommendations are at Annex D [PDF, 108 KB]. This consultation is launched concurrently to provide the public with a comprehensive view of the proposed changes to the Companies Act. The consultation paper reflects the inputs from Working Group 5 appointed by the Steering Committee to study regulation of foreign entities in Singapore, and takes into account responses to an earlier consultation paper on foreign companies issued by ACRA in October 2007 .

Public Consultation details

7. MOF and ACRA invite the public the send their comments on the Steering Committee's report and ACRA's public consultation paper on the regulatory framework for foreign entities. The public can also access both documents on MOF's website and the REACH consultation portal. Comments should be submitted as follows:

Steering Committee's report

• Email:  mof_pccompaniesact@mof.gov.sg 

• Fax: (+65) 6337 4134

• Mail: Corporate Regulation and Governance Unit 
  Economic Programmes Directorate 
  Ministry of Finance 
  100 High Street 
  #10-01, The Treasury 
  Singapore 179464

Consultation paper on foreign Entities

• Email:  acra_FEconsultation@acra.gov.sg

• Fax: (+65) 6225 1676

• Mail: Accounting and Corporate Regulatory Authority 
  Legal Services Division 
  10 Anson Road 
  #05-01/15 International Plaza 
  Singapore 079903

8. The three-month public consultation period will end on 16 September 2011. To reach out to a wider audience, MOF and ACRA will also collaborate with selected stakeholder groups to organise public seminars to share key recommendations from the Steering Committee’s Report and gather feedback. Details on the seminars will be announced at a later date.

MINISTRY OF FINANCE
ACCOUNTING AND CORPORATE REGULATORY AUTHORITY
20 June 2011

Documents for download:

• Annex A: Steering Committee's Report (full); [PDF, 3.1 MB] or 

  • Chapter 1 - Directors; [PDF, 490 KB] 

  • Chapter 2 - Shareholders' Rights and Meetings; [PDF, 509 KB]

  • Chapter 3 - Shares, Debentures, Capital Maintenance, Schemes, Compulsory Acquisitions and Amalgamations; [PDF, 593 KB]

  • Chapter 4 - Accounts and Audits; [PDF, 442 KB]

  • Chapter 5 - General Company Administration; [PDF, 437 KB] and

  • Chapter 6 - Registration of Charges [PDF, 307 KB]

• Annex B - Highlights of the Steering Committee's recommendations [PDF, 111 KB]

• Annex C - Consultation paper on the Review of the Regulatory Framework for Foreign Entities [PDF, 502 KB]

• Annex D - Highlights of ACRA's recommendations [PDF, 108 KB]