News, Publications and Events » Nexia Pulse » Nexia Pulse - Quarter 1 2016 issue » Key Legislative AmendmentsKey Legislative Amendments to the Companies Act - Phase 2

Nexia Pulse

Key Legislative Amendments to the Companies Act - Phase 2


The second and final phase of legislative changes to the Companies Act was effected on 3 January 2016. Below are some of the key legislative changes:


• No maximum age limit for directors


• Directors’ disclosure requirements extended to include Chief Executive Officers (CEOs)
CEOs of companies are now required to make the same disclosures as Directors. This is consistent with the approach already adopted for listed companies. A CEO of a company is defined as any one (or more) person(s), by whatever name described, who is in direct employment of, or acting for or by arrangement with, the company; and is principally responsible for the management and conduct of the business of the company, or part of the business of the company, as the case may be.


• Power of Registrar to debar directors and company secretaries
A director or company secretary who has failed to lodge any documents as required in the Companies Act for at least 3 months or more after the prescribed deadlines may face a debarment order from the Registrar. A debarred person will not be able to take on new appointments as director or company secretary of other companies but may continue with existing appointments. The Registrar will lift the debarment when the default has been rectified or on other prescribed grounds.


• Exemption of preparation of financial statements (“FS”) for dormant unlisted companies
A dormant non-listed company (other than a subsidiary of a listed company) is no longer required to prepare FS if (a) the company has been dormant from the time of formation or since the end of the previous financial year (“FY”); and (b) the company fulfils a substantial assets test, i.e. the total assets of the company or the total assets of the group if it is a parent company at any time within the FY must not exceed S$500,000. The exemption is only applicable to FYs that ended on or after 3 January 2016.


• Memorandum and Articles of Association are now merged into a single document called the Constitution


• Removal of one-share-one-vote restriction for public companies


• ACRA will now maintain the electronic register of members for private companies
Date of filing of the information with ACRA will be considered the effective date of entry/cessation as a member into the register.


• ACRA will also maintain the electronic registers of Directors, Secretaries, Auditors and CEOs

• Directors, CEOs and Secretaries are allowed to report an alternate address in place of their residential address
The alternate address must be located in the same jurisdiction as the individual’s residential address and where the person can be contacted. The alternate address cannot be a P.O. Box address.


For more information on the phased implementation of Companies (Amendment) Act 2014,
please refer to the ACRA website here:

https://www.acra.gov.sg/Legislation/Two-Phase_Implementation_of_Companies_(Amendment)_Act_2014/

 

CONTACTS
For more information, please contact:

Ms Loh Mei Ling
Associate Director
Corporate Secretarial
lohmeiling@csb.com.sg