Singapore legislation
Regulation 3
Regulation 3
Meaning of “subsidiary entity of another entity”
Subregulation 1
In these Regulations, an entity (called in this regulation the 1st entity) is treated as a subsidiary entity of another entity (called in this regulation the holding entity), if —
the holding entity —
controls the composition of the board of directors or its equivalent (called in this regulation the board) of the 1st entity; or
controls more than half of the voting power of the 1st entity; or
the 1st entity is a subsidiary entity of another entity which is a subsidiary entity of the holding entity.
Subregulation 2
For the purposes of paragraph (1)(a)(i), the holding entity is treated as having control of the composition of the 1st entity’s board if the holding entity has the power to appoint or remove all or a majority of the directors (or their equivalent) of the board without the consent or concurrence of any other person.
Subregulation 3
The holding entity mentioned in paragraph (2) is treated as having the power mentioned in that paragraph if —
a person cannot be appointed as a director or equivalent of the 1st entity’s board without the exercise in his or her favour by the holding entity of that power; or
a person’s appointment as a director or equivalent of the 1st entity’s board follows necessarily from his or her being a director or other officer, or the equivalent of a director or other officer, of the holding entity.
Subregulation 4
In determining whether an entity is a subsidiary entity of another entity under paragraph (1) —
any power exercisable over the 1st entity by the other entity in a fiduciary capacity is not to be treated as exercisable by the other entity;
subject to sub‑paragraphs (c) and (d), any power exercisable over the 1st entity —
by a nominee for the other entity (except where the other entity is concerned only in a fiduciary capacity); or
by a subsidiary entity of the other entity or a nominee for the subsidiary entity (except where the subsidiary entity is concerned only in a fiduciary capacity),is to be treated as exercisable over the 1st entity by the other entity;
any power exercisable over the 1st entity by any person by reason of the provisions of any debentures of the 1st entity or of a trust deed for securing any issue of such debentures is to be disregarded; and
any power exercisable over the 1st entity by, or by a nominee for, the other entity or its subsidiary entity (not being power exercisable over the 1st entity as mentioned in sub‑paragraph (c)) is not to be treated as exercisable by the other entity if —
the ordinary business of the other entity or its subsidiary entity (as the case may be) includes the lending of money; and (ii)the power is exercisable only as security for the purposes of a transaction entered into in the ordinary course of that business.
Subregulation 5
For the purposes of these Regulations, an entity is not to be treated as a subsidiary entity of another entity, being the Depository mentioned in section 5(5) of the Companies Act (Cap. 50), by reason only of the shares that the Depository holds in that entity as a bare trustee.