Legislation

Securities and Futures (Amendment) Act 2005 (A1/2005) and Financial Advisers (Amendment) Act 2005 (A2/2005)

The Securities and Futures (Amendment) Act 2005 (A1/2005) (‘SF(A) Act’) and the Financial Advisers (Amendment) Act 2005 (A2/2005) (‘FA(A) Act’) have been gazetted. These Amendment Acts will come into force on a date to be appointed.

Some of the key changes that will be made by the SF(A) Act to the Securities and Futures Act (Cap 289) include:

•    abolition of the ‘public offer’ concept

•    new exemptions from prospectus requirements: small offers, private placement and offers for no consideration

•    imposing prospectus disclosure liability on issue managers

•    permitting circulation of pre-deal research reports to institutional investors in certain circumstances

•    relaxing publicity restrictions for offers of collective investment schemes

•    refining treatment of non-retail investors

Among other changes, the FA(A) Act will amend the Financial Advisers Act (Cap 110) to exclude the application of the reasonable basis requirements when financial advice is given in seminars and talks, provided certain conditions are met.

Companies (Amendment) Bill 2005 (B11/2005)

On 18 April 2005, the Companies (Amendment) Bill 2005 (B11/2005) was tabled in Parliament for first reading. The Bill encompasses some changes proposed in the final report of the Company Legislation and Regulatory Framework Committee (‘CLRFC’) that was published on 22 October 2002.

The key features of the amendments proposed in the Bill include:

•    abolishing the concepts of ‘par value’ and ‘authorised capital’;

•    introducing an alternative capital reduction process which does not require court sanction;

•    liberalising the financial assistance restrictions to allow financial assistance to be provided in additional circumstances, eg where less than 10% of the company’s paid-up capital and reserves is involved, or where it is approved by a unanimous resolution of shareholders;

•    allowing share-buyback to be funded out of profits as well as capital so long as the company is solvent;

•    allowing repurchased shares to be held as treasury shares;

•    introducing a more effective and efficient statutory form of merger and amalgamation process.

Registered Designs (International Registration) Rules 2005 (S177/2005)

The Registered Designs (International Registration) Rules 2005 (S177/2005) (‘Rules’) was gazetted today, 31 March 2005 and shall be operative with effect from 17 April 2005.

The Rules are issued pursuant to sections 64A and 74 of the Registered Designs Act (Cap 266) (‘Act’).

Under the Rules, an international registration designating Singapore shall be entitled to become protected in Singapore if, had the particulars of the international registration been comprised in an application for registration of a design under the Act, that application would have satisfied the requirements for registration of a design under the Act and the Registered Designs Rules. However, this will be subject to an examination by the Registrar under rule 9. The manner of claiming priority shall be determined in accordance with the Geneva Act of the Hague Agreement and the Common Regulations, as defined in the Rules.

Building Maintenance and Strata Management Act (Commencement) Notification 2005 (S191/2005)

Pursuant to the Building Maintenance and Strata Management Act (Commencement) Notification 2005 (S191/2005), the Building Maintenance and Strata Management Act 2004 (A47/2004) (‘Act’) came into force on 1 April 2005 with the exception of the following provisions that deal with staged developments:

•    section 11 (2), (4) and (6) — acceptance of schedule of strata units by Commissioner of Buildings concerning staged developments;

•    section 12 (2) — no changing of schedule of accepted strata units related to staged developments;

•    section 33 (8) and (9) — making of exclusive use by-laws for staged developments

•    part VII — staged developments;

•    item (5) in the Third Schedule — consequential amendment to the Land Titles (Strata) Act concerning staged developments; and

•    items (9) (b), (11) and (12) (a) in the Fifth Schedule — consequential amendment to other Acts concerning staged developments.

To implement the Act, the following Regulations have also been issued under the Act. These Regulations come into operation on 1 April 2005.

•    Building Maintenance (Strata Management) Regulations 2005 (S192/2005).

•    Building Maintenance and Strata Management (Composition of Offences) Regulations 2005 (S193/2005).

•    Building Maintenance and Strata Management (Lift and Building Maintenance) Regulations 2005 (S194/2005).

•    Building Maintenance and Strata Management (Strata Titles Boards) Regulations 2005 (S195/2005).

•    Building Maintenance and Strata Management (Strata Units) Regulations 2005 (S196/2005).

•    Building Maintenance and Strata Management (Exempt Treasurers) Order 2005 (S197/2005).

•    Building Maintenance and Strata Management (HDB Privatised Estates — Exemption) Order 2005 (S198/2005).

•    Building Maintenance and Strata Management (Strata Management Accounts — Exemption) Order 2005 (S199/2005).

•    Building Maintenance and Strata Management (Transitional and Savings Provisions) Order 2005 (S200/2005).

•    Building Maintenance and Strata Management Act 2004 — Appointment of Registrar of Strata Titles Boards (GG801/2005).

Previously, the Buildings and Common Property (Maintenance and Management) Act (Cap 30) (‘BCPA’) and Parts IV and VI of the Land Titles (Strata) Act (Cap 158) (‘LTSA’) govern the management and maintenance of buildings in Singapore . The BCPA governs the maintenance of all buildings and management of strata developments prior to the formation of the management corporation (‘MC’). Part IV of the LTSA contains provisions relating to the MC, subsidiary proprietors, councils, managing agents (‘MAs’), and insurance of subdivided buildings. Part VI contains provisions relating to the establishment and proceedings of the Strata Titles Board (‘STB’). Following the commencement of the Act, the BCPA and Parts IV and VI of the LTSA are repealed and merged into the Act.

The Land Titles (Strata) Revocation Regulations 2005 (S188/2005) has been issued under the LTSA to revoke certain regulations following the repeal of Parts IV and VI of the LTSA.

Limited Liability Partnerships Act (Commencement) Notification 2005 (S235/2005)

Pursuant to the Limited Liability Partnerships Act (Commencement) Notification 2005 (S235/2005) (‘Commencement Notification’), the Limited Liability Partnerships Act 2005 (A5/2005) (‘LLP Act’) which was passed on 25 January 2005, came into force on 11 April 2005.

On 11 April 2005, the following rules and regulations have been gazetted to implement the LLP Act.

•    Limited Liability Partnerships Regulations 2005 (S244/2005) —provide for the forms and procedures with regards to the registration, administration, receivership, and winding up of limited liability partnerships (‘LLPs’).

•    Limited Liability Partnerships (Identical Names) Rules 2005 (S245/2005) — to set out the parameters as to what may be considered as identical names. For this purpose, consequential amendments have also been made to the Business Registration (Identical Names) Rules and the Companies (Identical Names) Rules pursuant to the Business Registration (Identical Names) (Amendment) Rules 2005 (S239/2005) and Companies (Identical Names) (Amendment) Rules 2005 (S240/2005) respectively.

All of the above subsidiary legislation are effective from 11 April 2005.

Stamp Duties (Amendment) Act (Commencement) Notification 2005 (S246/2005)

Pursuant to the Stamp Duties (Amendment) Act (Commencement) Notification 2005 (S246/2005), the Stamp Duties (Amendment) Act 2005 (A6/2005), which was passed on 25 January 2005, come into force on 11 April 2005.

The Stamp Duties Act (Cap 312) will be amended to provide for stamp duty issues in relation to LLPs. A definition of ‘limited liability partnership’ will be introduced.

Section 15 of the Stamp Duties Act will be amended to provide for relief from ad valorem stamp duty in the event of a conversion of a firm to a LLP under the proposed s 20 of the LLP Act. To implement these changes, the Stamp Duties (Relief From Stamp Duties Upon Conversion of Firm to Limited Liability Partnership) Rules 2005 (S247/2005) (‘Rules’) have been issued and they will come into force on 11 April 2005. The Rules set out the conditions for relief from ad valorem stamp duty upon conversion of firm to LLPs and the statutory requirement for doing so.

Elizabeth Wong

Allen & Gledhill