(Bloomberg) — Singapore plans to introduce a bill that sets out a new investment management regime for investors in a bid to ensure the continuity of so-called “critical entities.”
A proposed Significant Investments Review Bill seeks to allow the government to review ownership or control transactions involving entities considered critical to security, according to a statement from the Ministry of Trade and Industry on Friday.
The government will be empowered “to review ownership or control transactions involving an entity that has acted against Singapore’s national security interests,” it said.
While Singapore already relies on a range of sectoral laws, which include ownership and control safeguards, to monitor and manage entities in regulated sectors such as telecommunications, banking and utilities, the new bill seeks to create a level playing field for both local and foreign investors by applying the rules to all equally.
Designated entities will also be subject to other provisions including not being able to be voluntarily wind up or be dissolved without consent.
“It is critical for Singapore to remain open and connected to the world, and as such we must continually strengthen our position as a trusted hub for businesses to invest with confidence,” Minister for Trade and Industry Gan Kim Yong said. “We expect only a handful of critical entities to be designated under this bill.”
Here are some key details of the proposed bill:
- Buyers into designated entities are required to notify after becoming a 5% controller
- Must seek approval before becoming a 12%, 25%, or 50% controller, an indirect controller, or acquiring as a going concern (parts of) the business or undertaking
- Sellers are required to seek approval when ceasing to be a 50% or 75% controller
- Transactions that occur without the necessary approvals will be rendered void
- Materially affected parties can apply for validation notices
- Office of Significant Investments Review will be set up under MTI
–With assistance from Low De Wei.
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