Singapore legislation

Clause 89

Repeal and re‑enactment of section 172 and new sections 172A and 172B

Section 172 of the Companies Act is repealed and the following sections substituted therefor:“Provision protecting officers from liability172.—

(1)

Any provision that purports to exempt an officer of a company (to any extent) from any liability that would otherwise attach to him in connection with any negligence, default, breach of duty or breach of trust in relation to the company is void.(2) Any provision by which a company directly or indirectly provides an indemnity (to any extent) for an officer of the company against any liability attaching to him in connection with any negligence, default, breach of duty or breach of trust in relation to the company is void, except as permitted by section 172A or 172B.(3) This section shall apply to any provision, whether contained in a company’s constitution or in any contract with the company or otherwise.Provision of insurance172A. Section 172(2) shall not prevent a company from purchasing and maintaining for an officer of the company insurance against any such liability referred to in that subsection.Third party indemnity172B.—

(1)

Section 172(2) shall not apply where the provision for indemnity is against liability incurred by the officer to a person other than the company, except when the indemnity is against —

(a)

any liability of the officer to pay —

(i)

a fine in criminal proceedings; or

(ii)

a sum payable to a regulatory authority by way of a penalty in respect of non‑compliance with any requirement of a regulatory nature (however arising); or

(b)

any liability incurred by the officer —

(i)

in defending criminal proceedings in which he is convicted;

(ii)

in defending civil proceedings brought by the company or a related company in which judgment is given against him; or

(iii)

in connection with an application for relief referred to in subsection (4) in which the court refuses to grant him relief.(2) The references in subsection (1)(b) to a conviction, judgment or refusal of relief are references to the final decision in the proceedings.(3) For the purposes of subsection (2) —

(a)

a conviction, judgment or refusal of relief becomes final —

(i)

if it is not appealed against, at the end of the period for bringing an appeal; or

(ii)

if it is appealed against, at the time when the appeal (or any further appeal) is disposed of; and

(b)

an appeal (or further appeal) is disposed of —

(i)

if it is determined and there is no right of further appeal, or if there is a right of further appeal, the period for bringing any further appeal has ended; or

(ii)

if it is abandoned or otherwise ceases to have effect.(4) The reference in subsection (1)(b)(iii) to an application for relief is to an application for relief under section 76A(13) or 391.”.

Read in full context — Companies (Amendment) Bill →