Clause 18

by deleting subsection (1) and substituting the following subsection:“(1) Where a qualifying employee derives any gains or profits in any year of assessment, after the expiry of the minimum holding period, from any stock option granted on or after 1st June 2000, or any right or benefit under any share acquisition scheme (other than a stock option scheme) granted on or after 1st January 2002, to acquire shares in any qualifying company or in its holding company, there shall, subject to this section, be exempt from tax 50% of an amount of such gains or profits as determined under subsection (2).”;

by deleting the words “on the exercise, assignment or release of the right or benefit (referred to in this section as the exercise price)” in the 1st, 2nd and 3rd lines of subsection (2)(a) and substituting the words “under the right or benefit”;

by deleting the words “exercise price of the shares” in the 1st line of subsection (2)(b) and substituting the words “price to be paid for the shares under the right or benefit”;

by deleting the words “deemed to be income of a person under section 10(5)” in the 2nd and 3rd lines of subsection (3) and substituting the words “to which section 10(5) applies”;

by deleting the words “deemed income” in subsection (3)(a) and (b) and substituting in each case the words “gains or profits”;

by deleting the words “by the exercise, assignment or release of” in the 2nd line of subsection (4) and substituting the word “from”;

by deleting the definition of “minimum vesting period” in subsection (6) and substituting the following definition:“ “minimum holding period” —

in relation to a right or benefit to acquire shares in a qualifying company or holding company under any stock option scheme, means the period prescribed by the Singapore Exchange during which no option may be exercised under a stock option scheme implemented by any company listed on that Exchange, which would have been applicable to the stock option granted by the qualifying company or holding company, as the case may be, if it were a company listed on that Exchange; (b)in relation to a right or benefit to acquire shares in a qualifying company or holding company under any share acquisition scheme (other than a stock option scheme), means —

a period of at least one year after the grant of the right or benefit, during which the shares so acquired may not be sold, if the price to be paid for the shares under the right or benefit is at a discount to the market value or, if it is not possible to determine such value, the net asset value of the shares at the time of the grant of the right or benefit; or

a period of at least 6 months after the grant of the right or benefit, during which the shares so acquired may not be sold, if the price to be paid for the shares under the right or benefit is equal to or exceeds the market value or, if it is not possible to determine such value, the net asset value of the shares at the time of the grant of the right or benefit;”;

by inserting, immediately after the definition of “qualifying employee” in subsection (6), the following definition:“ “share acquisition scheme” means a scheme which imposes a minimum holding period requirement and allows an employee of a company to own or purchase shares in a qualifying company or that of its holding company, including stock options, share awards and other similar forms of employee share purchase plans but excluding phantom shares rights, share appreciation rights and any other similar rights;”;

by deleting subsection (7) and substituting the following subsection:“(7) For the purposes of this section and section 13L, where a company grants —

any stock option on or after 1st April 2001; or

any right or benefit under any share acquisition scheme (other than a stock option scheme) on or after 1st January 2002,to acquire shares under a tranche of the share acquisition scheme and any gains or profits derived by a qualifying employee from any right or benefit granted under that tranche qualifies for tax exemption under this section as well as section 13L, the company shall opt for the tax exemption under this section or section 13L to apply in respect of the gains or profits relating to that tranche but not under both sections.”;

by deleting the words “stock option scheme” in the 3rd, 8th and 11th lines of subsection (8) and in the 3rd and last lines of subsection (9) and substituting in each case the words “share acquisition scheme”; and

by deleting the words “stock option” in the section heading and substituting the words “equity-based remuneration scheme”.