Singapore Legal Update - July 2017
27 July 2017
Issues of Corporate Governance and Due Diligence Raised in SingPost's Review of Its Acquisition of TradeGlobal
SingPost issued an update on its review of its acquisition of TradeGlobal Holdings Inc. The report noted, among other things, that the paper and presentation proposing the acquisition to the Board did not highlight that the seller had purchased its stake in TradeGlobal at a price considerably lower than that offered to SingPost. It also did not highlight that the valuation of TradeGlobal was based on EBITDA forecasts that were significantly above the mean for those of comparable companies.
Errant Individuals Not Just Their Institutions Need to Be Made Responsible for Wrongdoing
On 7 November 2016, the Securities and Futures (Amendment) Bill underwent its first reading in Parliament. When passed and brought into force, it will amend the definitions of institutional and accredited investors, expand the definition of collective investment schemes to include schemes where contributions and profits are not pooled, introduce a regulatory regime for financial benchmarks and impose new obligations to report short-selling positions, in addition to a range of other changes.
Locally Resident Nominee Director Gets 12 Months for Not Stopping Money Laundering
A Nominee director appointed to be a company's locally resident director was ruled to have breached his duty to the company to use reasonable diligence. The High Court ruled that by failing to exercise any oversight over the company and its affairs, he allowed the company to be used to launder money. He was therefore held liable for the money laundering and sentenced to 12 months' imprisonment and a fine of SGD50,000.