Tuesday, 21 June 2011

Singapore: company law reform - consultation on Companies Act recommendations

The Ministry of Finance, in conjunction with the Accounting and Corporate Regulatory Authority, is seeking comments on a Steering Committee review report regarding the Companies Act: see here. The Committee's report is available here (pdf) and a short summary of its principal recommendations is available here (pdf).

The report contains over 200 recommendations across the following six chapters: [1] Directors, [2] Shareholders' Rights and Meetings, [3] Shares, Debentures, Capital Maintenance, Acquisitions and Amalgamations, [4] Accounts and Audit, [5] General Company Administration and [6] Registration of Charges. There is much of interest, not least because of the report's comparative focus and the consideration given to some of the changes introduced in the UK by the Companies Act (2006). For example, in Chapter One the Committee recommends that the duties of directors should not be codified along the lines found in the UK's Companies Act (2006) and states that it would be better to wait and see if codification in the UK has proved useful. In Chapter Two, the Committee recommends that a buy-out provision should not be introduced to enable a dissenting minority shareholder to require the company to buy him out at fair value. The Committee has also recommended that the law should be amended to extend the availability of the statutory derivative action to Singapore-incorporated companies that are quoted on a securities market whether in Singapore or overseas.

No comments: