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SGX proposes panels for greater enforcement powers, transparency

SINGAPORE — Three new independent committees proposed by the Singapore Exchange (SGX) could allow the regulator greater enforcement powers to fine firms in breach of listing rules, among other punitive steps, and more transparency in how it discharges its regulatory responsibilities.

SINGAPORE — Three new independent committees proposed by the Singapore Exchange (SGX) could allow the regulator greater enforcement powers to fine firms in breach of listing rules, among other punitive steps, and more transparency in how it discharges its regulatory responsibilities.

The Listings Advisory Committee, for which the SGX is proposing to have 15 members, seeks to tap expert, independent opinion to help the exchange make assessments on listing applications, reducing any conflict arising from its dual role as both operator and regulator.

The Listings Disciplinary Committee will hear charges against parties that breach listing rules and can impose regulatory sanctions, as well as issue public reprimands, impose fines and deny access to market facilities. The proposed enforcement powers would be over not only issuers, but also their directors, executive officers, issue managers and financial advisers.

The Listings Appeals Committee will hear appeals from companies subject to sanctions by the disciplinary committee.

At a press briefing, SGX chief regulatory officer Richard Teng elaborated: “(The three committees will) help us administer how we mete out enforcement … and there will be greater transparency in how we discharge our regulatory responsibilities. With that, it should bring about better quality, raising standards and making companies more mindful of their disclosure obligations.”

The proposals will be up for public consultation until Oct 16. The SGX, in consultation with the Monetary Authority of Singapore (MAS), aims to appoint the committees by the first quarter of next year.

The Securities Investors Association Singapore (SIAS) welcomed these moves, saying that more enforcement powers will go a long way to ensure greater responsibility and accountability.

“This move should give comfort to minority shareholders who are often in the bind when companies are subject to forced delisting, putting their investments in jeopardy,” said SIAS chief executive David Gerald.

Separately, the SGX and MAS will proceed with plans to introduce a minimum trading price (MTP) of S$0.20 for mainboard-listed stocks, after an earlier round of public consultation.

Issuers will be given a one-time transition period of 12 months from the effective date of this requirement to comply, failing which they will be placed on a watch list. The SGX will set the effective date by March next year. The issuers will be delisted after a 36-month cure period, if they fail to raise the MTP and exit the watchlist.

“There are many paths (to raise the MTP) and one option is consolidation of the share price. We will continue to work with listed companies. Since Aug 1, we have waived our fees with respect to share consolidation to encourage companies to do share consolidation,” said Mr Mohamed Nasser Ismail, head of issuer regulation at the SGX. Tan Weizhen

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