Companies Act 1967 · 2020 Revised Edition · Part 4 · Shares, Debentures and Charges
78B. Reduction of share capital by private company
Last amended by an amending law of 2014. 2 amendments in all.
Official textFrom Singapore Statutes Online, unchanged
A private company limited by shares may reduce its share capital in any way by a special resolution if the company —
private company
“private company” means —(a)any company which immediately prior to 29 December 1967 was a private company under the provisions of the repealed written laws;(b)any company incorporated as a private company by virtue of section 18; or(c)any company converted into a private company pursuant to section 31(1),being a company which has not ceased to be a private company under section 31 or 32;
[Deleted by Act 36 of 2014]
meets the solvency requirements; and
meets such publicity requirements as may be prescribed by the Minister,but the resolution and the reduction of the share capital take effect only as provided by section 78E.
Despite subsection (1), the company need not meet the solvency requirements if the reduction of share capital does not involve any of the following:
company
“company” means a company incorporated under this Act or under any corresponding previous written law;
a reduction or distribution of cash or other assets by the company;
a release of any liability owed to the company.
For the purposes of subsection (1), the company meets the solvency requirements if —
all the directors of the company make a solvency statement in relation to the reduction of capital; and
the statement is made —
in time for subsection (4)(a) to be complied with; but(ii)not before the beginning of the period of 20 days ending with the resolution date.
Unless subsection (2) applies, the company —
must —
if the resolution for reducing share capital is a special resolution to be passed by written means under section 184A — ensure that every copy of the resolution served under section 183(3A) or 184C(1) (as the case may be) is accompanied by a copy of the solvency statement; or
if the resolution is a special resolution to be passed in a general meeting — throughout that meeting make the solvency statement or a copy of it available for inspection by the members at that meeting; and
must, throughout the 6 weeks beginning with the resolution date, make the solvency statement or a copy of it available at the company’s registered office for inspection free of charge by any creditor of the company.
The resolution does not become invalid by virtue only of a contravention of subsection (4), but every officer of the company who is in default shall be guilty of an offence.
officer
“officer”, in relation to a corporation, includes —(a)any director or secretary of the corporation or a person employed in an executive capacity by the corporation;(b)a receiver and manager of any part of the undertaking of the corporation appointed under a power contained in any instrument; and(c)any liquidator of a company appointed in a voluntary winding up,but does not include —(d)any receiver who is not also a manager;(e)any receiver and manager appointed by the Court;(f)any liquidator appointed by the Court or by the creditors; or(g)a judicial manager appointed under Part 7 of the Insolvency, Restructuring and Dissolution Act 2018;
Any requirement under subsection (4)(b) ceases if the resolution is revoked.
Terms defined in s 4
charge
Defined · s 4“charge” includes a mortgage and any agreement to give or execute a charge or mortgage whether upon demand or otherwise;
company
Defined · s 4“company” means a company incorporated under this Act or under any corresponding previous written law;
officer
Defined · s 4“officer”, in relation to a corporation, includes —(a)any director or secretary of the corporation or a person employed in an executive capacity by the corporation;(b)a receiver and manager of any part of the undertaking of the corporation appointed under a power contained in any instrument; and(c)any liquidator of a company appointed in a voluntary winding up,but does not include —(d)any receiver who is not also a manager;(e)any receiver and manager appointed by the Court;(f)any liquidator appointed by the Court or by the creditors; or(g)a judicial manager appointed under Part 7 of the Insolvency, Restructuring and Dissolution Act 2018;
private company
Defined · s 4“private company” means —(a)any company which immediately prior to 29 December 1967 was a private company under the provisions of the repealed written laws;(b)any company incorporated as a private company by virtue of section 18; or(c)any company converted into a private company pursuant to section 31(1),being a company which has not ceased to be a private company under section 31 or 32;
registered
Defined · s 4“registered” means registered under this Act or any corresponding previous enactment;
share
Defined · s 4“share” means share in the share capital of a corporation and includes stock except where a distinction between stocks and shares is expressed or implied;
Part 5
Management and Administration
Part 6
Financial Statements and Audit
Part 7
Arrangements, Reconstructions and Amalgamations
Part 8
Part 8A
Part 9
Investigations
Part 10
Dissolution
Part 10A
Transfer of Registration
Part 11
Various Types of Companies, Etc.
Part 11A
Register of Controllers, Nominee Directors and Nominee Shareholders of Companies
Part 12