Singapore legislation
Section 7
Section 7
Minimum capital requirements
(1)
Subject to this Act, a company must not be granted or hold a licence unless —
in the case of a finance company which holds a licence to carry on financing business on 18 January 1995 — its capital funds are, subject to this section, at least $50 million; or
in the case of a finance company which is granted a licence to carry on financing business after 18 January 1995 — its issued and paid-up capital is at least $50 million and its capital funds are not less than that amount.
(2)
Despite subsection (1)(a), the Authority may, at any time, after 8 years from 18 January 1995, by order require the issued and paid‑up capital of a finance company to which that subsection applies to be at least $50 million within the time specified in that order.
(3)
Subject to subsection (4), a finance company to which subsection (1)(a) applies which has capital funds of less than $50 million on 18 January 1995 is exempt from the requirement of that provision for 8 years from 18 January 1995 and must not during that period allow its capital funds to be less than its capital funds on that date.
(4)
If 20% or more of the issued and paid-up capital of a finance company is acquired by one or more persons who, alone or acting together with any associate or associates, by virtue of such acquisition becomes a substantial shareholder of the finance company on or after 18 January 1995, the finance company —
must have at least $50 million in issued and paid‑up capital; and
ceases to be eligible for the exemption under subsection (3),unless all the new substantial shareholders are finance companies each with capital funds of at least $50 million at the time of the acquisition.
(5)
A finance company must not reduce its paid-up capital during the currency of its licence without the approval of the Authority.
(6)
The Authority may restrict or suspend the operations of a finance company which fails to comply with subsection (2), (3), (4) or (5).
(7)
In this section, “substantial shareholder” has the meaning given by section 81 of the Companies Act 1967.