Division 3 — Compulsory transfer of shares
of pertinent financial institution
Interpretation of this Division
30AAV.  In this Division, unless the context otherwise requires —
“business” includes affairs, property, right, obligation and liability;
“certificate” means a certificate of transfer issued by the Minister under section 30AAX(1);
“determination” means a determination made by the Authority under section 30AAW(2);
“property” includes property, right and power of every description;
“significant shareholder”, in relation to a pertinent financial institution, means any person prescribed by regulations made under section 30AAZN as a significant shareholder for that pertinent financial institution;
“significant shareholder provisions”, in relation to any pertinent financial institution, means such provisions of written law as may be prescribed by regulations made under section 30AAZN as significant shareholder provisions for that pertinent financial institution;
“transferee” means any person to whom a transferor’s shares are, are to be, or are proposed to be, transferred under this Division;
“transferor” means a shareholder of a pertinent financial institution whose shares in the pertinent financial institution are, are to be, or are proposed to be, transferred under this Division.
[Act 9 of 2013 wef 18/04/2013]
Compulsory transfer of shares
30AAW.—(1)  The Authority may make a determination that all or any of the shares held by a transferor in a pertinent financial institution incorporated in Singapore shall be transferred to a transferee, if —
(a)any ground exists for the Authority to exercise any power under the relevant provisions in relation to the pertinent financial institution, whether or not the Authority has exercised the power;
(b)the transferee or, where the transferee is a corporation or co-operative society, the board of directors of the transferee (in any case where the transferee is a corporation), or the committee of management of the transferee (in any case where the transferee is a co-operative society), has consented to the transfer; and
(c)the Authority is satisfied that the transfer is appropriate, having regard to —
(i)in any case where the pertinent financial institution is a bank licensed under the Banking Act (Cap. 19) —
(A)the interests of the depositors of the pertinent financial institution given priority and the order of priority of each class of depositors under section 62 of the Banking Act;
(B)if the transferee is a bank licensed under the Banking Act, the interests of the depositors of the transferee given priority and the order of priority of each class of depositors under section 62 of the Banking Act;
(C)the stability of the financial system in Singapore; and
(D)any other matter that the Authority considers relevant;
(ii)in any case where the pertinent financial institution is a finance company licensed under the Finance Companies Act (Cap. 108) —
(A)the interests of the depositors of the pertinent financial institution given priority and the order of priority of each class of depositors under section 44A of the Finance Companies Act;
(B)if the transferee is a finance company licensed under the Finance Companies Act, the interests of the depositors of the transferee given priority and the order of priority of each class of depositors under section 44A of the Finance Companies Act;
(C)the stability of the financial system in Singapore; and
(D)any other matter that the Authority considers relevant; or
(iii)in any other case —
(A)the interests of the affected persons of the pertinent financial institution;
(B)the interests of the affected persons, if any, of the transferee;
(C)the stability of the financial system in Singapore; and
(D)any other matter that the Authority considers relevant.
(2)  The Authority may, before making a determination, appoint one or more persons —
(a)to perform an independent assessment of —
(i)the proposed transfer of shares; and
(ii)the consideration, if any, that should be paid by the transferee; and
(b)to furnish to the Authority a report on the assessment and on the proposed transfer.
(3)  The remuneration and expenses of any person appointed under subsection (2) shall be paid by the pertinent financial institution.
(4)  The Authority shall serve a copy of any report furnished under subsection (2) on the transferor and the transferee.
(5)  Upon making a determination, the Authority shall submit the determination to the Minister for his approval.
(6)  Before approving the determination, the Minister shall, unless he decides that it is not practicable or desirable to do so —
(a)publish in the Gazette and in such newspaper or newspapers as he may determine a notice of his intention to approve the determination, specifying such particulars as he considers appropriate; and
(b)cause to be given to the transferor notice in writing of his intention to approve the determination, specifying such particulars as he considers appropriate and the date by which the transferor may make written representations to him.
(7)  In determining the period within which written representations have to be made under subsection (6), the Minister shall take into account the need for the transfer to be effected expeditiously in the interest of the stability of the financial system in Singapore.
(8)  Upon receipt of any written representation, the Minister shall consider the representation for the purpose of deciding whether to approve the determination.
(9)  Where the determination, if approved, will result in the transferee becoming a significant shareholder of the pertinent financial institution, the Minister shall not approve the determination unless —
(a)the Authority is satisfied that —
(i)the transferee is a fit and proper person; and
(ii)having regard to the likely influence of the transferee, the pertinent financial institution will or will continue to conduct its business prudently and comply with the provisions of this Act and the relevant Act applicable to the pertinent financial institution; and
(b)the Minister is satisfied that —
(i)in any case where the pertinent financial institution is a bank incorporated in Singapore, it is in the national interest to do so; or
(ii)in any other case, it is in the public interest to do so.
(10)  The Minister may —
(a)approve the determination without modification;
(b)approve the determination subject to any modification he considers appropriate, if the transferee or, where the transferee is a corporation or co-operative society, the board of directors of the transferee (in any case where the transferee is a corporation), or the committee of management of the transferee (in any case where the transferee is a co-operative society), has agreed to the modification; or
(c)refuse to approve the determination.
(11)  Any approval under subsection (10) shall be subject to such conditions as the Minister may determine, and the Minister may add to, vary or revoke any such condition.
(12)  The transferor shall comply with every condition referred to in subsection (11) that applies to the transferor.
(13)  The transferee shall comply with every condition referred to in subsection (11) that applies to the transferee.
(14)  A determination, an approval under subsection (10) of a determination or the issue of a certificate shall not preclude the exercise of any power by the Authority or the Minister under this Act or the relevant Act applicable to the pertinent financial institution.
[Act 9 of 2013 wef 18/04/2013]
Certificate of transfer
30AAX.—(1)  If the Minister approves a determination, he shall, as soon as practicable, issue a certificate of transfer, which shall come into effect on the date specified by him in the certificate.
(2)  The certificate shall specify such information as may be prescribed by regulations made under section 30AAZN.
(3)  The certificate may make provision for all or any of the following matters:
(a)the transfer to the transferee of all or any of the shares of the transferor in the pertinent financial institution;
(b)any share in the pertinent financial institution which is held by the transferor as trustee;
(c)the consideration, if any, to be paid by the transferee to the transferor, and the period within which the consideration is to be paid;
(d)such incidental, consequential and supplementary matters as are, in the Minister’s opinion, necessary to secure that the transfer is fully effective, including conditions relating to the transfer.
(4)  The Minister may at any time before the certificate comes into effect add to, vary or revoke any matter specified in the certificate.
(5)  On or before the date on which the certificate comes into effect, the Authority shall cause the certificate and any addition, variation or revocation referred to in subsection (4) to be served on the pertinent financial institution and published in the Gazette and in such newspaper or newspapers as the Minister may determine.
(6)  Notwithstanding any written law or rule of law, or anything in the memorandum and articles of association of the pertinent financial institution, upon the certificate coming into effect —
(a)any share of the transferor that is to be transferred under the certificate shall be transferred to and vest in the transferee, free from any claim or encumbrance, without other or further assurance, act or deed; and
(b)the certificate shall have effect according to its tenor and be binding on any person thereby affected.
(7)  For the avoidance of doubt, the shares of the transferor shall be transferred to and vest in the transferee in accordance with subsection (6), notwithstanding the death or dissolution, the bankruptcy or winding up, or the mental or other incapacity, of the transferor.
(8)  Section 259 of the Companies Act (Cap. 50) shall not apply to the transfer of any share under the certificate.
(9)  Where the transfer of shares under the certificate results in the transferee becoming a significant shareholder of the pertinent financial institution, upon the coming into effect of the certificate, the transferee —
(a)shall be deemed to have obtained the approval of the Minister or the Authority, as the case may be, under the significant shareholder provisions applicable to the pertinent financial institution, in respect of the shares; and
(b)shall not be required to make a take-over offer or be required to acquire the shares of the other shareholders of the pertinent financial institution, notwithstanding the provisions of the Companies Act or the Take-over Code.
(10)  A transferor or a transferee who fails to comply with any provision in the certificate shall be guilty of an offence and shall be liable on conviction —
(a)in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part thereof during which the offence continues after conviction; or
(b)in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part thereof during which the offence continues after conviction.
(11)  Where a person is charged with an offence under subsection (10), it shall be a defence for the person to prove that —
(a)he was not aware he had contravened any provision in the certificate; and
(b)he has complied with the provision within a reasonable time after becoming aware of the contravention.
(12)  Except as provided in subsection (11), it shall not be a defence for a person charged with an offence under subsection (10) that he did not intend to or did not knowingly contravene any provision in the certificate.
(13)  Notwithstanding section 30AAO(2) but subject to section 30AAZM, during the period beginning on the date on which the Minister publishes the notice under section 30AAW(6) in the Gazette on the transfer of any share in a pertinent financial institution or, where the notice is not published in the Gazette, the date on which the Authority publishes the certificate under subsection (5) in the Gazette on the transfer of the share, and ending on the date on which the transfer of the share comes into effect —
(a)no execution or other legal process shall be commenced or continued against the share;
(b)no steps shall be taken to enforce any security over the share;
(c)any sale, transfer, assignment or other disposition of the share shall be void;
(d)no voting rights shall be exercisable in respect of the share, unless the Minister expressly permits such rights to be exercised;
(e)no shares in the pertinent financial institution shall be issued or offered (whether by ways of rights, bonus or otherwise) in respect of the share, unless the Minister expressly permits such issue or offer;
(f)no payment shall be made by the pertinent financial institution of any amount (whether by dividends or otherwise) in respect of the share, unless the Minister expressly authorises such payment;
(g)no resolution shall be passed, and no order shall be made, for the winding up of the pertinent financial institution;
(h)no judicial management order under Part VIIIA of the Companies Act shall be made in relation to the pertinent financial institution;
(i)no proceedings shall be commenced or continued against the pertinent financial institution in respect of any business of the pertinent financial institution;
(j)no execution, distress or other legal process shall be commenced, levied or continued against any property of the pertinent financial institution;
(k)no steps shall be taken to enforce any security over any property of the pertinent financial institution; and
(l)any sale, transfer, assignment or other disposition of any property of the pertinent financial institution shall be void.
[Act 9 of 2013 wef 18/04/2013]