Singapore legislation
Clause 242
Clause 242
Stop order for prospectus and profile statement
(1)
If a prospectus that has been registered —
contains any statement or matter which, in the Authority’s opinion, is false or misleading;
omits any information that should have been included in it under section 243 or 244; or
does not in the Authority’s opinion comply with the requirements of this Act,the Authority may by an order in writing (referred to in this section as a stop order) served on the person who lodged the prospectus direct that no or no further shares or debentures, or units of shares or debentures to which the prospectus relates be allotted, issued or sold.
(2)
If a profile statement that has been registered —
contains any statement or matter which, in the Authority’s opinion, is false or misleading;
omits any information that should have been included in it under section 246 or includes information that should have been excluded from it under section 246; or
does not in the Authority’s opinion comply with the requirements of this Act,the Authority may by an order in writing (referred to in this section as a stop order) served on the person who lodged the profile statement, direct that no or no further shares or debentures, or units of shares or debentures to which the profile statement relates be allotted, issued or sold.
(3)
Notwithstanding subsections (1) and (2), the Authority shall not serve a stop order if any of the shares or debentures or units of shares or debentures to which the prospectus or profile statement relates have been issued or sold, and listed on a securities exchange and trading in them has commenced.
(4)
The Authority shall not serve a stop order under subsection (1) or (2) without giving the person who lodged the prospectus or profile statement an opportunity to be heard.
(5)
Where applications to subscribe for shares, debentures or units of shares or debentures to which the prospectus or profile statement relates have been made prior to the stop order, and —
where the shares or debentures, or units of shares or debentures have not been issued to the applicants, the applications shall be deemed to have been withdrawn and cancelled and the corporation shall, within 14 days from the date of the stop order, pay to the applicants all moneys the applicants have paid on account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 shares, debentures or units of shares or debentures; or
where the shares or debentures, or units of shares or debentures, have been issued to the applicants, the issue of the shares or debentures, or units of shares or debentures, shall be deemed to be void and the corporation shall, within 14 days from the date of the stop order, pay to the applicants all moneys paid by them for the shares, debentures, or units of shares or debentures.
(6)
Subsection (5)(b) has effect notwithstanding sections 73, 76 and 76A of the Companies Act (Cap. 50).
(7)
Where applications to purchase shares, debentures or units of shares or debentures to which the prospectus or profile statement relates have been made prior to the stop order, and —
where the shares or debentures, or units of shares or debentures have not been sold to the applicants, the applications shall be deemed to have been withdrawn and cancelled and the corporation shall, on behalf of the vendor, 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 shares or debentures, or units of shares or debentures; or
where the shares or debentures, or units of shares or debentures have been sold to the applicants, the sale shall be deemed to be void and the corporation shall, on behalf of the vendor —
if documents purporting to evidence title had been issued to the applicants, within 7 days from the date of the stop order, inform all applicants to return such documents to the corporation within 14 days from that date; and
within 7 days from the date of the receipt of those documents (if applicable) or the date of the stop order, whichever is later, pay to the applicants all moneys paid by them for the shares, debentures or units of shares or debentures.
(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 who lodged the prospectus or profile statement directing that no or no further shares in or debentures of, or units of shares in or debentures of, a corporation to which the prospectus or profile statement relates be allotted, issued or sold.
(9)
An interim stop order shall, unless revoked, be 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) shall 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 thereof 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 thereof during which the offence continues after conviction.