SINGAPORE LAW AND PRACTICE Contributed by: Jeffrey Lim, Daniel Lim, Frederick Tay, Genevi Lim, Lakshmanan Anbarazan, Sarah Lai, Stephanie Goh and Tobias Andreas Satria, Joyce A. Tan & Partners LLC
• whether the potential investor or acquirer is a fit and proper person under the Guidelines on Fit and Proper Criteria; • having regard to the influence of such potential investor or acquirer, whether the Critical Entities will continue to carry on their business or undertak - ing; and • it is not against the national security interests of Singapore to do so. 7.2 Criteria for National Security Review Please refer to 7.1 Applicable Regulator and Process Overview and 8.1 Other Regimes for the different cri - teria and considerations. 7.3 Remedies and Commitments Please refer to 7.4 National Security Review Enforce- ment for more details. 7.4 National Security Review Enforcement The implications of not complying with the SIRA or the respective sectoral-specific legislation (refer to 8. Other Review/Approvals ) can vary and may include one or more of the following: • persons who fail to comply may be held liable for a criminal offence or be subject to fines; and/or • the relevant authorities may: (a) direct the persons to dispose of the interests acquired; (b) resist the transfer and prevent such transfer of interests from taking place; or (c) restrict the exercise of any rights acquired through the acquisition of the shares.
regulatory requirements and exceptions, which are listed below. Real Estate Under the Residential Property Act 1976 in Singapore, restrictions on foreign ownership apply to specified types of residential property. Foreign persons, com - prising persons who are not a Singapore citizen, company, limited liability partnership or society, must apply for approval to purchase, acquire or retain resi - dential property, or such ownership would be void. Banking Industry The Banking Act 1970 of Singapore (BA) generally regulates both substantial shareholdings and the acquisition of certain threshold amounts of Singa - pore-incorporated banks. Subject to certain variations depending on the type of bank – for example, foreign banks may take only a minority stake in a digital full bank, but may acquire any level of shareholding in a digital wholesale bank – the approval of the Minister for Finance is required in specified circumstances. These include the acquisition of an interest or inter - ests in one or more voting shares of a bank where the total votes attached to those shares amount to not less than 5% of the total voting rights of the bank, as well as situations where a person becomes, on or after 18 July 2001, a 12% controller, a 20% control - ler or an indirect controller of a bank incorporated in Singapore. Approval must be obtained prior to the acquisition and/or control and the Minister of Finance will have to consider as part of the application whether the person is a fit and proper person and, having regard to the likely influence of the person, whether the bank incor - porated in Singapore will or will continue to conduct its business prudently and comply with the provisions of the BA. Also, the Minister of Finance must be satis - fied that it is in the national interests to approve the acquisition and/or the control. The Minister of Finance can grant exemptions from complying with the thresholds above but such exemp - tions have since been granted on a per-entity basis rather than based on certain criteria being met.
8. Other Review/Approvals 8.1 Other Regimes
Generally, Singapore adopts an open-door policy in relation to foreign direct investments. However, the Singapore government also acknowledges that there are certain key industries which will require tighter scrutiny and regulation where foreign investments are concerned. These are usually in the following industries: banking, telecommunications, broadcast - ing and public utilities (which include water, electricity and gas). Each of these sectors have their respective
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