Singapore legislation
Section 32
Section 32
Major stake in entity
(1)
A bank in Singapore must not acquire or hold, directly or indirectly, a major stake in any entity without the prior approval of the Authority.
(2)
The Authority must not grant its approval under subsection (1) if the entity carries on, whether as its principal business or otherwise, any prohibited business.
(3)
Despite subsection (2), the Authority may, in a particular case that comes within that subsection, grant its approval if it is satisfied that approval should be granted by reason of the exceptional circumstances of the case.
(3A)
An approval of the Authority under this section may be subject to such conditions as the Authority may determine, including any condition relating to the operations or activities of the entity concerned.
(3B)
The Authority may at any time add to, vary or revoke any condition imposed under subsection (3A).
(4)
This section does not apply to —
any interest held by way of security for the purposes of a transaction entered into in the ordinary course of the business of the bank in Singapore;
any shareholding or interest acquired or held by a bank in Singapore in the course of satisfaction of debts due to it which is disposed of at the earliest suitable opportunity; and
such other interest as may be prescribed.
(5)
The Authority may, by regulations —
disapply this section to any entity or class of entities, subject to such conditions as may be prescribed;
provide for the manner of computation of major stakes; and
provide that any interest or control mentioned in the definition of “major stake” in subsection (7) that is acquired or held, directly or indirectly, by an entity in which a bank has, directly or indirectly, a major stake is to be treated as acquired or held by the bank.
(6)
Any bank which contravenes this section or fails to comply with any condition imposed or prescribed under this section shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction.
(7)
In this section —
Definition
“company” means a company incorporated under the Companies Act 1967 or any corresponding previous written law, or a company incorporated outside Singapore;
Definition
“entity” means any body corporate or unincorporate, whether incorporated, formed or established in or outside Singapore;
Definition
“limited liability partnership” has the meaning given by section 2(1) of the Limited Liability Partnerships Act 2005, and includes a limited liability partnership formed or established outside Singapore;
Definition
“major stake”, in relation to an entity, means —
any beneficial interest exceeding 10% of the total number of issued shares or such other measure corresponding to shares in a company as may be prescribed;
control of over more than 10% of the voting power or such other measure corresponding to voting power in a company as may be prescribed; or
any interest in the entity, by reason of which the management of the entity is accustomed or under an obligation, whether formal or informal, to act in accordance with the bank’s directions, instructions or wishes, or where the bank is in a position to determine the policy of the entity;
Definition
“management”, in relation to an entity, means —
if the entity is a company, its directors;
if the entity is a limited liability partnership, its partners or managers;
if the entity is any other partnership, its partners;
if the entity is a cooperative society, the members of its committee of management; or
if the entity is any other society, its officers,and includes such other person of the entity as the Authority may prescribe;
Definition
“prohibited business” means any business other than the businesses mentioned in section 30(1)(a) to (d).
(8)
This section does not affect any acquisition or holding of a major stake which was approved by the Authority before 18 July 2001.