SINGAPORE Law and Practice Contributed by: Azmul Haque, Ashley Chew, Hu Yutong and Aaron Leong, Collyer Law LLC
• approval is required for acquisitions of all or part of a designated entity’s business or undertaking as a going concern; and • an existing controller must obtain prior approval before ceasing to be a 50% or 75% controller. The Minister may vary these thresholds for specific designated entities. Sector-Specific Controls Separate approval requirements apply in regulated sectors. • Banks: under the Banking Act 1970, no person may become a substantial shareholder (gener - ally 5% or more of voting shares) of a Singapore- incorporated bank without prior approval from the Minister for Finance. • Newspapers: under the Newspaper and Printing Presses Act 1974, foreign corporations cannot hold management shares without ministerial approval from the Minister for Communications and Informa - tion. • Broadcasting: under the Broadcasting Act 1994, a broadcasting licence will not be granted to any company that is controlled by foreign sources, or where foreign sources hold 49% or more of the shares or voting power. • Real estate: under the Residential Property Act 1976, foreigners must seek prior written approval from the Minister for Law before purchasing real estate such as vacant residential land, landed properties and residential shophouses. These are illustrative only, and other sector-specific regimes may apply. 2.2 Procedure to Obtain Approval and The steps for foreign investors to obtain approval depend on the applicable regime, but broadly involve the following. • Determining whether the proposed investment trig - Sanctions for Non-Compliance Process for Obtaining Approval gers any notification or approval thresholds. • Making submissions to relevant authorities:
(a) for SIRA matters, submissions are made to the Ministry of Trade and Industry through the Office of Significant Investments Review (OSIR); and (b) for regulated sectors, submissions are made to the relevant sector regulator. • The relevant authority will assess the submissions, focusing on national security, public interest or continuation of the entity in providing critical func - tion. • Approval may be granted with or without condi - tions, or refused. The timeline varies depending on the complexity of the transaction and the nature of the sector, and may range from a few weeks to several months. Non-Compliance The consequences of non-compliance depend on the applicable regime. Under SIRA, the Minister of Trade and Industry has broad enforcement powers, such as: • directing the disposal of shares or interests; • unwinding or voiding the transaction; and • imposing restrictions on business operations. Non-compliance may also attract financial penalties and, in some cases, criminal liability. Sector-specific regimes may impose additional sanc - tions, including licence-related action (such as sus - pension or revocation) and directions to divest offend - ing shareholdings. 2.3 Commitments Required From Foreign Investors Singapore authorities may grant approval subject to conditions, particularly where the investment raises national security, public interest or regulatory com - pliance concerns. The nature and extent of com - mitments depend on the applicable regime and the nature of the sector. For SIRA, the statute itself does not prescribe a closed list of conditions. Instead, it confers wide discretion to impose such conditions as the Minister considers appropriate having regard to national security. Condi - tions may include:
933 CHAMBERS.COM
Powered by FlippingBook