1. Business Law Reforms
in Singapore
Presented by: Elena Yeo (Ms)
Legal Officer
Legal Services Department
Accounting and Corporate Regulatory Authority,
Singapore
To provide a responsive and trusted regulatory environment for businesses
and public accountants.
2. Overview of ACRA
Accounting and Corporate Regulatory Authority (ACRA)
- national regulator of business entities and public
accountants in S’pore;
- plays the role of a facilitator for the development of
business entities and the public accountancy
profession.
Formed as a statutory board on 1 April 2004, following
the merger of the then Registry of Companies and
Businesses and the Public Accountants’ Board.
Administers: the Accounting and Corporate Regulatory
Authority Act, the Accountants Act, the Business
Registration Act, the Companies Act, the Limited
Liability Partnerships Act and the Limited Partnerships
Act.
3. Registered entities
As at 31 Dec 2011, the population of registered business
entities were as follows:
Entity type Number
Business 151,071
Company 231,213
LLP 9,607
LP 91
Public Accounting Firms 525
Public Accountants 967
4. Key business law reforms
in recent years
Major amendments to the Companies Act rolled out
2003 to 2006, following review by the Company
Legislation and Regulatory Framework Committee
appointed by the Ministry of Finance, the Attorney-
General’s Chambers and the Monetary Authority of
Singapore in Dec 1999.
New legislation - Limited Liability Partnerships Act
(2005)
‒ Regulates new business vehicle which gives flexibility of
operating as a partnership while having a separate
legal identity like a private limited company.
5. Key business law reforms
in recent years
New legislation - Limited Partnerships Act (2008)
‒ Regulates new business vehicle called ‘limited
partnership’ - at least one general partner with
unlimited liability and at least one limited partner with
limited liability.
Other legal reforms:
‒ Study on directors’ duties.
‒ Review of the regulatory framework for branches of
foreign companies.
‒ Alternate address policy.
6. Highlights of ongoing
legislative reviews
Ongoing reviews of the following:
‒ Business Registration Act
‒ Companies Act
Proposed new legislation for regulation of
branches of foreign companies.
7. Ongoing review
- Business Registration Act
Act has only had piecemeal amendments since coming
into force in 1974. Timely for a comprehensive review.
Objective of the review: To modernise the provisions and
make them more relevant and current to the present day
business environment.
Public consultation on key issues for review published in
mid-October 2010. Feedback and issues are undergoing
review.
8. Business Registration Act
- Key areas of review
Exempting individuals carrying on business in
their own names from registering.
Requiring individuals resident in Singapore and
carrying on business through online/electronic
means in Singapore to register.
Reviewing and updating the penalties for
breaches of the Act.
9. Ongoing review
- Companies Act
Private-sector led Steering Committee (SC) for reviewing the
Companies Act formed Oct 2007.
Objective of the review: to ensure that we have an efficient and
transparent corporate regulatory framework that supports
Singapore’s growth as a global hub for businesses and
investors.
Public consultation on SC Report closed in Oct 2011. Feedback
is undergoing review.
ACRA also concurrently conducted its own review of regulatory
issues in respect of companies (e.g penalties, administrative
provisions).
10. Companies Act
- Approach
Act to be re-written; not merely amended.
Aim is to make the legislation more comprehensible,
coherent and practical.
Companies Act to contain core company law. Migrate
provisions that are not core company law to other
legislation.
Flexibility to allow procedures to be modified as the
environment changes, through subsidiary legislation.
11. Companies Act
- Key areas of review
The SC's Report, comprising six chapters and 217
recommendations.
Key areas of review:
- Directors
- Shareholders' Rights and Meetings
- Shares, Debentures, Capital Maintenance, Schemes,
Compulsory Acquisitions and Amalgamations
- Accounts and Audits
- General Company Administration
- Registration of Charges
12. Companies Act
- Key areas of review
Directors’ duties
‒ No codification of directors’ duties; extension of
duties to other officers
Extension of disclosure requirements to
other officers
‒ Extension to Chief Executive Officer
13. Companies Act
- Key areas of review
Enfranchising indirect investors
- Express provision for multiple proxies for specific
members who provide custodial or nominees services
Electronic Transmission of Notices and
Documents
- Liberalising the rules for companies to transmit notices
and documents electronically.
14. Companies Act
- Key areas of review
Share Capital and others
‒ Refining regulation of transactions affecting share capital
– e.g. uniform solvency test, financial assistance rules
etc.
Introduction of a “small company” concept
for audit exemption
‒ Updating approach for audit exemption to be based on
criteria such as revenue, assets and number of
employees.
15. Companies Act
- Key areas of review
Alternate address
‒ Allow disclosure of alternate address (where person can
be located) instead of residential address
‒ Authoritative ACRA register for private
companies
‒ ACRA register definitive in place of the register of
members (for private companies)
16. Ongoing review
- Act regulating foreign entities
Background:
‒ Companies Act contains provisions relating to foreign
companies.
‒ Companies Act Steering Committee took the view that
the laws relating to the registration and regulation of
foreign entities should be placed in separate legislation to
facilitate the streamlining of Companies Act.
‒ No intent for any significant widening of the scope of
regulation for foreign entities.
17. Act regulating foreign entities
- Key areas of review
Clarifying the reference of “foreign companies” to
“foreign entities”.
Streamlining the requirements and procedures for
registration of foreign entities.
Streamlining continuing filing obligations.
Enhancing financial disclosure requirements and
accountability for financial information filed by foreign
entities for greater transparency.
Expansion of the grounds for striking-off a foreign entity.
18. Other developments –
Formalities in executing documents
ACRA is working with the Attorney-General’s Chambers in
the implementation of proposals to simplify the execution
of instruments, especially deeds, by individuals and
corporations.
Main change will be that a deed will no longer need to be
sealed in the case of individuals, companies, limited
liability partnerships and various other corporate bodies.
Relevant persons will be allowed to sign on behalf of
corporate bodies as an alternative to affixing of its
common seal.
