Singapore legislation
Regulation 16
Regulation 16
Limitation of mutual shareholdings
Subregulation 1
No qualified major stake entity of a bank incorporated in Singapore shall acquire or hold shares in the bank which has the effect of enabling it, whether alone or jointly with other qualified major stake entities of the bank, to control more than 2% of the voting power in the bank.
Subregulation 2
No qualified major stake entity of a bank incorporated in Singapore shall acquire or hold shares in any holding company of the bank which has the effect of enabling it, whether alone or jointly with other qualified major stake entities of the bank, to control more than 2% of the voting power in the holding company.
Subregulation 3
No qualified major stake entity of a bank incorporated in Singapore shall acquire or hold shares in the bank and any of the holding companies of the bank which has the effect of enabling it, whether alone or jointly with other qualified major stake entities of the bank, to control —
any percentage of the voting power in the bank; and
any percentage of the voting power in any of the holding companies of the bank,such that the sum total of the percentages referred to in sub-paragraphs (a) and (b) (notwithstanding that they are percentages of voting powers in different companies) exceeds 2.
Subregulation 4
No bank incorporated in Singapore shall cause or knowingly permit any of its qualified major stake entities to acquire or hold shares in the bank or any holding company of the bank in contravention of paragraphs (1), (2) or (3).
Subregulation 5
For the purposes of determining whether there is a contravention of paragraph (1), (2), (3) or (4), any control of voting power in a bank or any holding company of the bank that is held by a qualified major stake entity of that bank —
for the benefit of any person other than the qualified major stake entity or any other qualified major stake entity of that bank (referred to in this paragraph as the beneficiary), pursuant to an obligation imposed under any written law, rule of law, contract or order of court; and
used or exercised by the qualified major stake entity for the benefit of the beneficiary,shall be disregarded, unless —
the qualified major stake entity is an insurer licensed under the Insurance Act (Cap. 142), and the control of voting power is held by it through any of the insurance funds specified in regulation 12(3)(i)(A) to (D); or
the Authority (having regard to the specific circumstances of the case including whether the qualified major stake entity has investment and voting policies that comply with guidelines issued by the Authority) is of the opinion that the control of voting power in the bank or holding company of the bank is in fact not being used or exercised primarily for the benefit of the beneficiary, and the Authority issues a declaration by notice in writing to the qualified major stake entity that such control of voting power in the bank or holding company of the bank shall, with effect from the date of the declaration, be included for the purpose of determining whether there is a contravention of paragraph (1), (2), (3) or (4).