Singapore legislation
Section 242
Section 242
Stop order for prospectus and profile statement
(1)
If a prospectus has been registered and —
the Authority is of the opinion that the prospectus contains a false or misleading statement;
there is an omission from the prospectus of any information that is required to be included in it under section 243;
the Authority is of the opinion that the prospectus does not comply with the requirements of this Act; or
the Authority is of the opinion that it is in the public interest to do so,the Authority may by a written order (called in this section a stop order) served on the person making the offer of securities or securities‑based derivatives contracts to which the prospectus relates direct that no or no further securities or securities‑based derivatives contracts be allotted, issued or sold.
(2)
If a profile statement has been registered and —
the Authority is of the opinion that the profile statement contains a false or misleading statement;
there is an omission from the profile statement of any information that is required to be included in it under section 246;
the Authority is of the opinion that the profile statement does not comply with the requirements of this Act; or
the Authority is of the opinion that it is in the public interest to do so,the Authority may by a written order (called in this section a stop order) served on the person making the offer of securities or securities‑based derivatives contracts to which the profile statement relates direct that no or no further securities or securities‑based derivatives contracts be allotted, issued or sold.
(3)
Despite subsections (1) and (2), the Authority must not serve a stop order if any of the securities or securities‑based derivatives contracts to which the prospectus or profile statement relates has been issued or sold, and listed for quotation on an approved exchange and trading in them has commenced.
(4)
The Authority must not serve a stop order under subsection (1) or (2) without giving the person making the offer an opportunity to be heard, except that an opportunity to be heard need not be given if the stop order is served on the ground that it is in the public interest to do so on the basis of any of the following circumstances:
the person making the offer (being an entity), the issuer or the trustee‑manager of the business trust or, where applicable, the underlying entity or the business trust is in the course of being wound up or otherwise dissolved, whether in Singapore or elsewhere;
(aa)the person making the offer (being an individual) is an undischarged bankrupt, whether in Singapore or elsewhere;
a receiver, a receiver and manager or an equivalent person has been appointed, whether in Singapore or elsewhere, in relation to or in respect of —
any property of the person making the offer (being an entity), the issuer or, where applicable, the underlying entity;
any property of the trustee‑manager of the business trust; or
the trust property of the business trust.
(5)
Where applications to subscribe for securities or securities‑based derivatives contracts to which the prospectus or profile statement relates have been made prior to the stop order, then —
where the securities or securities‑based derivatives contracts have not been issued to the applicants —
the applications are deemed to have been withdrawn and cancelled; and
the person making the offer must, within 14 days from the date of the stop order, pay to the applicants all moneys the applicants have paid on account of their applications for the securities or securities‑based derivatives contracts; or
where the securities or securities‑based derivatives contracts have been issued to the applicants —
the issue of the securities or securities‑based derivatives contracts is deemed to be void; and
the person making the offer must, within 14 days from the date of the stop order, pay to the applicants all moneys paid by them for the securities or securities‑based derivatives contracts.
(6)
Subsection (5)(b) has effect despite sections 76 and 76A, and Division 3A of Part 4, of the Companies Act 1967.
(7)
Where applications to purchase securities or securities‑based derivatives contracts to which the prospectus or profile statement relates have been made prior to the stop order, then —
where the securities or securities‑based derivatives contracts have not been transferred to the applicants —
the applications are deemed to have been withdrawn and cancelled; and
the person making the offer must, within 14 days from the date of the stop order, pay to the applicants all moneys the applicants have paid on account of their applications for the securities or securities‑based derivatives contracts; or
where the securities or securities‑based derivatives contracts have been transferred to the applicants, the sale is deemed to be void, and the person making the offer must —
if documents purporting to evidence title to the securities or securities‑based derivatives contracts have been issued to the applicants —
within 7 days from the date of the stop order, inform the applicants to return such documents to the person making the offer within 14 days from that date; and
within 7 days from the date of the receipt of those documents or the date of the stop order, whichever is the later, pay to the applicants all moneys paid by them for the securities or securities‑based derivatives contracts; or
if no such documents have been issued to the applicants, within 7 days from the date of the stop order, pay to the applicants all moneys paid by them for the securities or securities‑based derivatives contracts.
(8)
If the Authority is of the opinion that any delay in serving a stop order pending the holding of a hearing required under subsection (4) is not in the interests of the public, the Authority may, without giving an opportunity to be heard, serve an interim stop order on the person making the offer directing that no or no further securities or securities‑based derivatives contracts to which the prospectus or profile statement relates be allotted, issued or sold.
(9)
An interim stop order, unless revoked by the Authority, is in force —
in a case where —
it is served during a hearing under subsection (4); or
a hearing under subsection (4) is commenced while it is in force,until the Authority makes an order under subsection (1) or (2); and
in any other case, for a period of 14 days from the day on which the interim stop order is served.
(10)
Subsections (5) and (7) do not apply where only an interim stop order has been served.
(11)
Any person who fails to comply with a stop order served under subsection (1) or (2) or an interim stop order served under subsection (8) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $150,000 or to imprisonment for a term not exceeding 2 years or to both and, in the case of a continuing offence, to a further fine not exceeding $15,000 for every day or part of a day during which the offence continues after conviction.
(12)
Any person who contravenes subsection (5) or (7) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part of a day during which the offence continues after conviction.
(13)
For the purposes of subsections (1)(a) and (2)(a), any reference to a statement includes a reference to any information presented, regardless of whether such information is in text or otherwise.