Capital Market Regulations in Singapore

Legislation related to capital markets in Singapore

Singapore offers a very advantageous environment for foreign companies wanting to trade on the city-state’s capital markets. The Monetary Authority of Singapore is the main regulator for foreign investors applying for a capital market service license. In order to obtain such license, the following legislation must be complied with:

• -          the Securities and Futures Act,
• -          the Monetary Authority of Singapore Act in the Companies Law,
• -          the SGX-ST Listing Manual,
• -          the Singapore Code on Takeovers and Mergers.

The SGX-ST is the main Stock Exchange in Singapore which also falls under the supervision of the Monetary Authority. For details about listing companies on the SGX you can refer to our law firm in Singapore.

Listing on capital markets in Singapore

The regulations in Singapore provides for the following types of capital markets:

• -          debt capital markets,
• -          equity capital markets,
• -          foreign exchange.

In order to list a Singapore company on the equity market at least one of the following requirements must be fulfilled:

• -          the issuer’s cumulative consolidated tax profits must be at least 7.5 million SGD in the last three years, and at least 1 million SGD every year,
• -          the Singapore company’s cumulative consolidate tax profits must be at least 10 million SGD for the last one or two years,
• -          the issue price for market capitalization must be at least 80 million SGD.

The Singapore Stock Exchange does not impose any minimum quantitative entry requirements.

Foreign issuers on the Singapore capital markets

Foreign companies wanting to enter the Singapore capital markets must have at least 500 shareholders. The minimum post-invitation share capital required to list the company on the Stock Exchange is:

• -          25% if the market capitalization is below 300 million SGD,
• -          20% if the market capitalization is between 300 million and 400 million SGD,
• -          15% if the market capitalization is between 400 million and 1 billion SGD,
• -          12% if the market capitalization is at least 1 billion SGD.

Foreign companies wanting to list their shares on the SGX must have at least two independent Singapore directors.

If you need help with the capital market service license application, please contact our lawyers in Singapore.