Singapore legislation
Section 259
Section 259
Allotment of securities or securities‑based derivatives contracts where prospectus indicates application to list on approved exchange
(1)
Where a prospectus states or implies that application has been or will be made for permission for the securities or securities‑based derivatives contracts offered thereby to be listed for quotation on any approved exchange, and —
the permission is not applied for in the form required by the approved exchange within 3 days from the date of the issue of the prospectus; or
the permission is not granted before the expiration of 6 weeks from the date of the issue of the prospectus or such longer period not exceeding 12 weeks from the date of the issue as is, within those 6 weeks, notified to the applicant by or on behalf of the approved exchange,then —
any allotment whenever made of securities or securities‑based derivatives contracts made on an application pursuant to the prospectus is, subject to subsection (3), void; and
any person who continues to allot such securities or securities‑based derivatives contracts after the period specified in paragraph (a) or (b), 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.
(2)
Where the permission has not been applied for, or has not been granted as mentioned under subsection (1), the person making the offer must, subject to subsection (3), immediately repay without interest all moneys received from applicants pursuant to the prospectus, and if any such moneys is not repaid within 14 days after the person making the offer so becomes liable to repay them, then —
the person making the offer is liable to repay those moneys with interest at the rate of 10% per annum from the expiration of such 14 days; and
where the person making the offer is an entity, in addition to the liability of the entity, the directors or equivalent persons of the entity are jointly and severally liable to repay those moneys with interest at the rate of 10% per annum from the expiration of such 14 days.
(3)
Where in relation to any securities or securities‑based derivatives contracts —
permission is not applied for as mentioned in subsection (1)(a); or
permission is not granted as mentioned in subsection (1)(b),the Authority may, on the application of the issuer made before any of the securities or securities‑based derivatives contracts is purported to be allotted, exempt the allotment of the securities or securities‑based derivatives contracts from the provisions of this section, and the Authority must give notice of such exemption in the Gazette.
(4)
A director or an equivalent person is not liable under subsection (2) if he or she proves that the default in the repayment of the money was not due to any misconduct or negligence on his or her part.
(5)
Any condition requiring or binding any applicant for securities or securities‑based derivatives contracts to waive compliance with any requirement of this section or purporting to do so is void.
(6)
Without limiting the application of any of its provisions, this section has effect —
in relation to any securities or securities‑based derivatives contracts agreed to be taken by a person underwriting an offer thereof contained in a prospectus as if the person had applied therefor pursuant to the prospectus; and
in relation to a prospectus offering securities or securities‑based derivatives contracts for sale as if a reference to sale were substituted for a reference to allotment.
(7)
All moneys received from applicants pursuant to the prospectus must be kept in a separate bank account so long as the person making the offer may become liable to repay it under subsection (2).
(8)
Any person who contravenes subsection (7) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 12 months or to both and, in the case of a continuing offence, to a further fine not exceeding $5,000 for every day or part of a day during which the offence continues after conviction.
(9)
Where the approved exchange has within the time specified in subsection (1)(b) granted permission subject to compliance with any requirements specified by the approved exchange, permission is deemed to have been granted by the approved exchange if the directors or equivalent persons have given to the approved exchange an undertaking in writing to comply with the requirements of the approved exchange.
(10)
If any such undertaking referred to in subsection (9) is not complied with, each director or equivalent person who is in default shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 and, in the case of a continuing offence, to a further fine not exceeding $5,000 for every day or part of a day during which the offence continues after conviction.
(11)
A person must not issue a prospectus inviting persons to subscribe for securities or securities‑based derivatives contracts of an entity if it includes —
a false or misleading statement that permission has been granted for those securities or securities‑based derivatives contracts to be listed for quotation on, dealt in or quoted on any approved exchange; or
any statement in any way referring to any such permission or to any application or intended application for any such permission, or to listing for quotation, dealing in or quoting the securities or securities‑based derivatives contracts on any approved exchange, or to any requirement of an approved exchange, unless —
that statement is or is to the effect that permission has been granted, or that application has been or will be made to the approved exchange within 3 days after the date of the issue of the prospectus; or
that statement has been approved by the Authority for inclusion in the prospectus.
(12)
Any person who contravenes subsection (11) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 12 months or to both and, in the case of a continuing offence, to a further fine not exceeding $5,000 for every day or part of a day during which the offence continues after conviction.
(13)
Where a prospectus contains a statement to the effect that the memorandum and articles or other constituent document or documents of the issuer comply, or have been drawn so as to comply, with the requirements of any approved exchange, the prospectus is, unless the contrary intention appears from the prospectus, deemed for the purposes of this section to imply that application has been, or will be, made for permission for the securities or securities‑based derivatives contracts to which the prospectus relates to be listed for quotation on the approved exchange.