8.—(1) The principal Act is amended by inserting, immediately after section 44, the following Part:“PART IVA CONTROL OF DESIGNATED ENTITIES, DESIGNATED
BUSINESS TRUSTS AND DESIGNATED TRUSTS |
| Interpretation of this Part |
44A.—(1) In this Part, unless the context otherwise requires —“5% controller”, in relation to a designated entity, designated business trust or designated trust, means a person who, alone or together with the person’s associates —| (a) | holds 5% or more, but less than 12%, of the total equity interests in; or | | (b) | is in a position to control 5% or more, but less than 12%, of the voting power in, |
| the designated entity, designated business trust or designated trust, as the case may be; |
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“12% controller”, in relation to a designated entity, designated business trust or designated trust, means a person who, alone or together with the person’s associates —| (a) | holds 12% or more, but less than 30%, of the total equity interests in; or | | (b) | is in a position to control 12% or more, but less than 30%, of the voting power in, |
| the designated entity, designated business trust or designated trust, as the case may be; |
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“30% controller”, in relation to a designated entity, designated business trust or designated trust, means a person who, alone or together with the person’s associates —| (a) | holds 30% or more of the total equity interests in; or | | (b) | is in a position to control 30% or more of the voting power in, |
| the designated entity, designated business trust or designated trust, as the case may be; |
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“acquisition” includes an agreement to acquire, but does not include —| (a) | an acquisition by will or by operation of law; or | | (b) | an acquisition by way of enforcement of a security for any loan or other debt; |
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| “appointed day” means the date of commencement of section 8(1) of the Public Utilities (Amendment) Act 2020; |
| “arrangement” includes any formal or informal scheme, arrangement or understanding, and any trust whether express or implied; |
| “business trust” has the meaning given by section 2 of the Business Trusts Act (Cap. 31A); |
| “control” includes control as a result of, or by means of, any trust, agreement, arrangement, understanding or practice, whether or not having legal or equitable force and whether or not based on legal or equitable rights; |
| “corporation” has the meaning given by section 4(1) of the Companies Act (Cap. 50); |
| “designated business trust” means a business trust that has been designated under section 44D as a designated business trust; |
| “designated entity” means an entity that has been designated under section 44D as a designated entity; |
| “designated trust” means a trust that has been designated under section 44D as a designated trust; |
| “director” has the meaning given by section 4(1) of the Companies Act; |
| “entity” means any sole proprietorship, partnership, corporation or other body of persons, whether corporate or unincorporate; |
“equity interest” means —| (a) | in relation to a corporation — a voting share in that corporation; | | (b) | in relation to an entity other than a corporation — any right or interest, whether legal or equitable, in that entity (by whatever name called) which gives the holder of that right or interest voting power in that entity; | | (c) | in relation to a business trust — a unit in that business trust; and | | (d) | in relation to a trust other than a business trust — any right or interest, whether legal or equitable, in that trust (by whatever name called) which gives the holder of that right or interest voting power in that trust; |
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“indirect controller”, in relation to a designated entity, designated business trust or designated trust, means any person, whether acting alone or together with any other person, and whether with or without holding equity interests or controlling the voting power in the designated entity, designated business trust or designated trust, as the case may be —| (a) | whose directions, instructions or wishes the directors or other officers of the designated entity, the trustee‑manager of the designated business trust, or the trustee of the designated trust (as the case may be) is accustomed or under an obligation, whether formal or informal, to act in accordance with; or | | (b) | who is in a position to determine the policy of the designated entity, designated business trust or designated trust, as the case may be, |
| (c) | any person who is a director or other officer of the designated entity, the trustee‑manager of the designated business trust or the trustee of the designated trust, as the case may be; or | | (d) | any person whose directions, instructions or wishes the directors or other officers of the designated entity, the trustee‑manager of the designated business trust or the trustee of the designated trust (as the case may be) is accustomed to act in accordance with by reason only that they act on advice given by the person in that person’s professional capacity; |
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| “limited liability partnership” has the meaning given by section 2(1) of the Limited Liability Partnerships Act (Cap. 163A); |
| “liquidator” includes the Official Receiver when acting as the liquidator of a corporation; |
“officer”, in relation to a corporation, includes —| (a) | a director or secretary of, or a person employed in an executive capacity by, the corporation; | | (b) | any receiver or manager, or any receiver and manager, of any part of the undertaking of the corporation, appointed under a power contained in any instrument or by the High Court or by creditors; | | (c) | any liquidator of the corporation appointed in a voluntary winding up or by the High Court or by creditors; and | | (d) | any judicial manager of the corporation appointed by the High Court under Part VIIIA of the Companies Act; |
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| “Official Receiver” means the Official Assignee as defined in section 2(1) of the Bankruptcy Act (Cap. 20); |
| “related corporation”, in relation to a corporation, means another corporation that is deemed under section 44C(2) to be related to that corporation; |
| “share”, in relation to a corporation, means a share in the share capital of the corporation and includes stock into which all or any of the share capital of the corporation has been converted; |
| “treasury share” has the meaning given by section 4(1) of the Companies Act; |
| “trustee‑manager” has the meaning given by section 2 of the Business Trusts Act; |
| “unit” has the meaning given by section 2 of the Business Trusts Act; |
| “unitholder” means a person who holds units in a business trust; |
| “unregistered company” has the meaning given by section 350 of the Companies Act; |
| “voting share” has the meaning given by section 4(1) of the Companies Act but does not include a treasury share. |
| (2) A reference in this Part to the control of a percentage of the voting power in a designated entity, designated business trust or designated trust is a reference to the control, whether direct or indirect, of that percentage of the total number of votes that might be cast in a general meeting of the designated entity, a general meeting of the unitholders of the designated business trust, or a general meeting of the beneficiaries of the designated trust, as the case may be. |
| (3) In ascertaining a person’s control of the percentage of the total number of votes that might be cast at a general meeting mentioned in subsection (2), the number of votes that the person is entitled to cast at the meeting by reason of having been appointed a proxy or representative to vote at the meeting is to be disregarded. |
(4) In this Part —| (a) | a reference to the business or undertaking of a designated business trust means the business or undertaking carried on by the trustee‑manager of the designated business trust on behalf of the designated business trust; and | | (b) | a reference to the business or undertaking of a designated trust means the business or undertaking carried on by the trustee of the designated trust on behalf of the designated trust. |
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(5) A reference in this Part —| (a) | to the High Court is, on or after the date of commencement of the Supreme Court of Judicature (Amendment) Act 2019 (Act 40 of 2019), a reference to the General Division of the High Court; | | (b) | to any judicial manager appointed by the High Court under Part VIIIA of the Companies Act includes, on or after the date of commencement of section 451 of the Insolvency, Restructuring and Dissolution Act 2018 (Act 40 of 2018) (called in this subsection the IRD Act), a judicial manager (as defined in section 88(1) of the IRD Act) appointed by the Court under the IRD Act; | | (c) | to the Official Assignee as defined in section 2(1) of the Bankruptcy Act is, on or after the date on which the Bankruptcy Act is repealed by notification made under section 450 of the IRD Act, a reference to the Official Receiver as defined in section 2(1) of the IRD Act; | | (d) | to a judicial management order made under the Companies Act includes, on or after the date of commencement of section 451 of the IRD Act, a judicial management order made under Part 7 of the IRD Act; | | (e) | to section 211I of the Companies Act is, on or after the date of commencement of section 451 of the IRD Act, a reference to section 71 of the IRD Act; | | (f) | to Part VIIIA of the Companies Act is, on or after the date of commencement of section 451 of the IRD Act, a reference to Part 7 of the IRD Act; | | (g) | to any proceedings under the Companies Act relating to winding up includes a reference to any proceedings under the IRD Act relating to winding up; and | | (h) | to sections 254(2), 350 and 351(2) of the Companies Act is, on or after the date of commencement of section 451 of the IRD Act, a reference to sections 125(2), 245 and 246(2), respectively, of the IRD Act. |
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| What holding an equity interest means |
44B.—(1) A person holds an equity interest under this Part if the person —| (a) | has or is deemed to have an equity interest in accordance with subsections (2) to (8); or | | (b) | otherwise has a legal or equitable interest in that equity interest, |
| except for any interest prescribed by regulations made under section 72 as an interest that is to be disregarded. |
| (2) Subject to subsection (3), a person has an equity interest if the person has authority (whether formal or informal, or express or implied) to dispose of, or to exercise control over the disposal of, that equity interest. |
| (3) It is immaterial that the authority of a person to dispose of, or to exercise control over the disposal of, the equity interest mentioned in subsection (2) is, or is capable of being made, subject to restraint or restriction. |
| (4) It is immaterial, for the purposes of determining whether a person has an equity interest, that the interest cannot be related to a particular share, an interest or a right that gives its holder voting power, or a unit of a business trust, as the case may be. |
(5) A person is deemed to have an equity interest if —| (a) | any property held in trust consists of or includes the equity interest; and | | (b) | that person knows, or has reasonable grounds for believing, that that person has an interest under that trust. |
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(6) A person is also deemed to have an equity interest if that person —| (a) | has entered into a contract to purchase the equity interest; | | (b) | has a right, otherwise than by reason of having an interest under a trust, to have the equity interest transferred to (or to the order of) that person, whether the right is exercisable presently or in the future and whether on the fulfilment of a condition or not; | | (c) | has the right to acquire the equity interest under an option, whether the right is exercisable presently or in the future and whether on the fulfilment of a condition or not; or | | (d) | is entitled (otherwise than by reason of having been appointed a proxy or representative to vote (as the case may be) at a general meeting of the entity, a general meeting of the unitholders of the designated business trust, or a general meeting of the beneficiaries of the designated trust in question) to exercise or control the exercise of a right attached to the equity interest, not being an equity interest in which that person has a legal or equitable interest. |
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| (7) A person is not to be deemed as not having an equity interest by reason only that the person has the equity interest jointly with another person. |
(8) An equity interest is not to be disregarded by reason only of —| (a) | its remoteness; | | (b) | the manner in which it arose; or | | (c) | the fact that the exercise of a right conferred by the equity interest is, or is capable of being made, subject to restraint or restriction. |
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| (9) Regulations made under section 72 may provide that any equity interest is to be disregarded for the purposes of this section or any subsection of this section. |
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44C.—(1) In this Part, a person (A) is an associate of another person (B) if —| (a) | A is the spouse, or a parent, step‑parent or remoter lineal ancestor, or a son, stepson, daughter, stepdaughter or remoter issue, or a brother or sister, of B; | | (b) | A is a partner of B in a partnership or limited liability partnership; | | (c) | A is a corporation of which B is an officer; | | (d) | B is a corporation of which A is an officer; | | (e) | A and B are officers of the same corporation; | | (f) | A is an employee of B; | | (g) | B is an employee of A; | | (h) | A and B are employees of the same employer; | | (i) | A is the trustee of a discretionary trust where B (or another person who is an associate of B by virtue of any paragraph, except this paragraph and paragraphs (j) and (r)) benefits, or is capable (whether by exercise of a power of appointment or otherwise) of benefitting, under the trust, either directly or through interposed entities or trusts; | | (j) | B is the trustee of a discretionary trust where A (or another person who is an associate of A by virtue of any paragraph, except this paragraph and paragraphs (i) and (r)) benefits, or is capable (whether by exercise of a power of appointment or otherwise) of benefitting, under the trust, either directly or through interposed entities or trusts; | | (k) | A is a corporation whose directors are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of B or, where B is a corporation, of the directors of B; | | (l) | B is a corporation whose directors are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of A or, where A is a corporation, of the directors of A; | | (m) | A is a person who is accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of B or, where B is a corporation, of the directors of B; | | (n) | B is a person who is accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of A or, where A is a corporation, of the directors of A; | | (o) | A is a related corporation of B or B is a related corporation of A; | | (p) | A is a corporation in which B, alone or together with other associates of B as described in paragraphs (b) to (o), is in a position to control not less than 20% of the voting power in A; | | (q) | B is a corporation in which A, alone or together with other associates of A as described in paragraphs (b) to (o), is in a position to control not less than 20% of the voting power in B; | | (r) | A is a person with whom B enters, or proposes to enter, into an agreement or arrangement (whether oral or in writing and whether express or implied) that relates to any of the following matters:| (i) | A and B being in a position, by acting together, to control any of the voting power in a designated entity, designated business trust or designated trust; | | (ii) | A and B acting together with respect to the acquisition, holding or disposal of equity interests or other interests in a designated entity, designated business trust or designated trust; | | (iii) | the power of A and B, by acting together, to appoint or remove a director of a designated entity, a director of the trustee‑manager of a designated business trust or, where the trustee of a designated trust is a corporation, a director of the trustee; | | (iv) | the situation where one or more of the directors of —| (A) | a designated entity; | | (B) | the trustee‑manager of a designated business trust; or | | (C) | the trustee of a designated trust, where the trustee is a corporation, |
| is or are accustomed or under an obligation (whether formal or informal) to act in accordance with the directions, instructions or wishes of A and B acting together; |
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| | (s) | A controls more than half of the voting power of a holding company of B; | | (t) | B controls more than half of the voting power of a holding company of A; or | | (u) | A is related to B in such other manner as may be prescribed by regulations made under section 72. |
(2) A corporation (A) and another corporation (B) are deemed to be related to each other for the purposes of this section where A is —| (a) | the holding company of B; | | (b) | a subsidiary of B; or | | (c) | a subsidiary of the holding company of B. |
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(3) For the purposes of this section, a corporation (A) is, subject to subsection (5), deemed to be a subsidiary of another corporation (B) if —| (a) | B controls the composition of the board of directors of A; | | (b) | B controls more than half of the voting power of A; or | | (c) | A is a subsidiary of any corporation which is B’s subsidiary. |
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(4) For the purposes of subsection (3), the composition of A’s board of directors is deemed to be controlled by B if, by the exercise of some power exercisable by B without the consent or concurrence of any other person, B can appoint or remove all or a majority of the directors, and for the purposes of this provision, B is deemed to have power to make such an appointment if —| (a) | a person cannot be appointed as a director without the exercise in the person’s favour by B of such a power; or | | (b) | a person’s appointment as a director follows necessarily from that person being a director or other officer of B. |
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(5) In determining whether one corporation (A) is the subsidiary of another corporation (B) —| (a) | any shares held or power exercisable by B in a fiduciary capacity is treated as not held or exercisable by B; | | (b) | subject to paragraphs (c) and (d), any shares held or power exercisable —| (i) | by any person as a nominee for B (except where B is concerned only in a fiduciary capacity); or | | (ii) | by, or by a nominee for, a subsidiary of B, not being a subsidiary which is concerned only in a fiduciary capacity, |
| is to be treated as being held or exercisable by B; |
| | (c) | any shares held or power exercisable by any person by virtue of the provisions of any debentures of A, or of a trust deed for securing any issue of such debentures, is to be disregarded; and | | (d) | any shares held or power exercisable by, or by a nominee for, B or its subsidiary (not being held or exercisable as mentioned in paragraph (c)) is to be treated as not held or exercisable by B if the ordinary business of B or its subsidiary (as the case may be) includes the lending of money and the shares are so held or power is so exercisable by way of security only for the purposes of a transaction entered into in the ordinary course of that business. |
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| (6) A reference in this section to the holding company of a company or other corporation is to be read as a reference to a corporation of which the last mentioned company or corporation is a subsidiary. |
| (7) For the purposes of this section, the Depository is not to be regarded as a holding company of a corporation by reason only of the shares it holds in that corporation as a bare trustee. |
| (8) Regulations made under section 72 may provide that any person or class of persons are not associates of another person for the purposes of any provision of this Part. |
(9) In this section —| “Depository” has the meaning given by section 81SF of the Securities and Futures Act (Cap. 289); |
| “officer”, in relation to a corporation, means a director or secretary of, or any person employed in an executive capacity by, the corporation. |
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Division 2 — Designation and controllers of designated
entities, designated business trusts and designated trusts |
| Designation of designated entity, designated business trust and designated trust |
44D.—(1) The Board may, after consultation with the Minister —| (a) | designate as a designated entity any entity that has a contract with the Board —| (i) | to supply water to the Board; or | | (ii) | to collect, treat, recover or dispose of used water (including sewage, waste matter and effluent); |
| | (b) | designate as a designated business trust a business trust that is established wholly or partly in respect of —| (i) | the supply of water to the Board; or | | (ii) | the collection, treatment, recovery or disposal of used water (including sewage, waste matter and effluent); and |
| | (c) | designate as a designated trust a trust that is established wholly or partly in respect of —| (i) | the supply of water to the Board; or | | (ii) | the collection, treatment, recovery or disposal of used water (including sewage, waste matter and effluent), |
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| if the Board considers that such designation is necessary in the public interest. |
| (2) Any designation under subsection (1) must be notified in the Gazette. |
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| Notice to Board by 5% controller |
44E.—(1) If a person becomes, on or after the appointed day, a 5% controller of a designated entity, designated business trust or designated trust, that person must, within 7 days after becoming the 5% controller, give notice in writing to the Board of that fact.| (2) Any person who contravenes subsection (1) shall be guilty of an offence. |
(3) In any proceedings for an offence in relation to a contravention of subsection (1), it is a defence for the accused to prove that the accused —| (a) | was not aware of the contravention when it occurred; and | | (b) | notified the Board of the contravention within a period of 14 days after becoming aware of the contravention. |
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(4) In any proceedings for an offence in relation to a contravention of subsection (1), it is also a defence for the accused to prove that even though the accused was aware of the contravention —| (a) | the contravention occurred as a result of an increase in the holding of equity interest, or in the voting power controlled, by any of the associates of the accused, in the designated entity, designated business trust or designated trust, as the case may be; | | (b) | the accused has no agreement or arrangement (whether oral or in writing and whether express or implied) with that associate with respect to the acquisition, holding or disposal of equity interests or other interests, or under which they act together in exercising their voting power, in relation to the designated entity, designated business trust or designated trust, as the case may be; and | | (c) | the accused notified the Board of the contravention within a period of 7 days after the contravention. |
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| (5) Except as provided in subsections (3) and (4), it is not a defence in any proceedings for an offence in relation to a contravention of subsection (1) to prove that the accused did not intend to or did not knowingly contravene subsection (1). |
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| Approvals of Board in relation to equity interests and control of voting power in certain cases |
44F.—(1) Except with the prior written approval of the Board, a person must not become, on or after the appointed day, a 12% controller or 30% controller of a designated entity, designated business trust or designated trust.| (2) Subsection (1) does not apply where the transaction through which a person becomes a 12% controller or 30% controller is entered into before the appointed day. |
| (3) Except with the prior written approval of the Board, a person must not become, on or after the appointed day, an indirect controller of a designated entity, designated business trust or designated trust. |
(4) A person must not acquire, on or after the appointed day, as a going concern the business or undertaking, or any part of the business or undertaking, of a designated entity, a designated business trust or a designated trust which relates to —| (a) | the supply of water to the Board; or | | (b) | the collection, treatment, recovery or disposal of used water (including sewage, waste matter and effluent), |
| unless the person, and the designated entity, the trustee‑manager of the designated business trust, or the trustee of the designated trust (as the case may be) have obtained the prior written approval of the Board. |
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(5) On an application for approval under subsection (1) or (3), the Board may approve the application if the Board is satisfied —| (a) | that the person who is to become a 12% controller or 30% controller or an indirect controller of a designated entity, designated business trust or designated trust (as the case may be) and every associate of that person, is a fit and proper person; | | (b) | that having regard to the influence of —| (i) | the person mentioned in paragraph (a); and | | (ii) | every associate of that person, |
| the designated entity, designated business trust or designated trust (as the case may be) will continue to conduct its business or undertaking prudently and continue its business or undertaking of supplying water to the Board or of collecting, treating, recovering or disposing of used water (including sewage, waste matter and effluent); and |
| | (c) | that it is in the public interest to do so. |
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(6) On an application for approval under subsection (4), the Board may approve the application if the Board is satisfied —| (a) | that the person acquiring the business or undertaking is a fit and proper person; | | (b) | that the acquisition will not affect the security and reliability of the supply of water in Singapore; and | | (c) | that it is in the public interest to do so. |
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| (7) An approval of the Board under this section may be granted subject to such conditions as the Board considers appropriate to impose. |
| (8) Any condition imposed by the Board under subsection (7) has effect despite the provisions of any other written law or anything contained in the memorandum or articles of association, trust deed or other constitution of the designated entity, designated business trust or designated trust in relation to which the application for approval under subsection (1), (3) or (4) is made. |
| (9) Any person who is aggrieved by the refusal of the Board to grant an approval required under subsection (1), (3) or (4) or by the imposition of any condition under subsection (7), may within 14 days after being informed of the refusal or the imposition of the condition (as the case may be) appeal to the Minister whose decision is final. |
| (10) Any person who contravenes subsection (1), (3) or (4) shall be guilty of an offence. |
(11) In any proceedings for an offence in relation to a contravention of subsection (1), it is a defence for the accused to prove that —| (a) | the accused was not aware of the contravention when it occurred; | | (b) | the accused notified the Board of the contravention within a period of 14 days after becoming aware of the contravention; and | | (c) | where the Board issued any direction under section 44G relating to the contravention and the holding of equity interests or the control of voting power by the accused in the designated entity, designated business trust or designated trust, as the case may be —| (i) | the accused complied with the direction within the period determined by the Board under that section; or | | (ii) | the period determined by the Board under that section for the compliance of the direction has not expired. |
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(12) In any proceedings for an offence in relation to a contravention of subsection (1), it is also a defence for the accused to prove that even though the accused was aware of the contravention —| (a) | the contravention occurred as a result of an increase in the holding of equity interest, or in the voting power controlled, by any of the associates of the accused, in the designated entity, designated business trust or designated trust, as the case may be; | | (b) | the accused has no agreement or arrangement (whether oral or in writing and whether express or implied) with that associate with respect to the acquisition, holding or disposal of equity interests or other interests, or under which they act together in exercising their voting power, in relation to the designated entity, designated business trust or designated trust, as the case may be; | | (c) | the accused notified the Board of the contravention within a period of 7 days after the contravention; and | | (d) | where the Board issued any direction under section 44G relating to the contravention and the holding of equity interests or the control of voting power by the accused in the designated entity, designated business trust or designated trust, as the case may be —| (i) | the accused complied with the direction within the period determined by the Board under that section; or | | (ii) | the period determined by the Board under that section for the compliance of the direction has not expired. |
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(13) In any proceedings for an offence in relation to a contravention of subsection (3), it is a defence for the accused to prove that —| (a) | the accused was not aware of the contravention when it occurred; | | (b) | the accused notified the Board of the contravention within a period of 14 days after the contravention; and | | (c) | where the Board issued any direction under section 44G relating to the contravention and the accused becoming an indirect controller of the designated entity, designated business trust or designated trust, as the case may be —| (i) | the accused complied with the direction within the period determined by the Board under that section; or | | (ii) | the period determined by the Board under that section for the compliance of the direction has not expired. |
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| (14) Except as provided in subsections (11), (12) and (13), it is not a defence in any proceedings for an offence in relation to a contravention of subsection (1) or (3) to prove that the accused did not intend to or did not knowingly contravene subsection (1) or (3), as the case may be. |
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44G.—(1) This section applies if the Board is satisfied that —| (a) | the person mentioned in subsection (2), (3) or (4) has contravened section 44F(1), (3) or (4), as the case may be; | | (b) | any condition of approval imposed on a person under section 44F(7) has not been complied with; | | (c) | a person has provided false or misleading information or documents in connection with an application for approval under section 44F(1), (3) or (4), as the case may be; | | (d) | in the case of a person who had obtained the Board’s approval under section 44F(5) —| (i) | the person or any associate of the person is not, or has ceased to be, a fit and proper person; | | (ii) | that having regard to the influence of the person or of any associate of the person, the designated entity, designated business trust or designated trust (as the case may be) is not, or is no longer likely to continue to conduct its business or undertaking prudently or is not, or is no longer likely to continue its business or undertaking of supplying water to the Board or of collecting, treating, recovering or disposing of used water (including sewage, waste matter and effluent); or | | (iii) | it is not, or is no longer, in the public interest to allow the person to continue to be a 12% controller, a 30% controller or an indirect controller, as the case may be; |
| | (e) | in the case of a person who had obtained the Board’s approval under section 44F(6) —| (i) | the person is not or has ceased to be a fit and proper person; or | | (ii) | it is not, or is no longer, in the public interest to allow the person to continue to own or manage the business or undertaking or the part of the business or undertaking that was acquired; or |
| | (f) | the Board would not have granted its approval to a person under section 44F(5) or (6) (as the case may be) if the Board had been aware, at the time, of circumstances relevant to the person’s application for such approval. |
(2) Where the person mentioned in subsection (1) is a 12% controller or 30% controller of a designated entity, designated business trust or designated trust, the Board may do any one or more of the following:| (a) | direct the person to take such steps as are necessary, within such period as may be specified by the Board, to cease to be a 12% controller or 30% controller (as the case may be) of the designated entity, designated business trust or designated trust, as the case may be; | | (b) | direct the transfer or disposal of all or any of the equity interest in the designated entity, designated business trust or designated trust (as the case may be) held by the person or any of the person’s associates (called in this section and section 44H the specified equity interest), within such time and subject to such conditions as the Board considers appropriate; | | (c) | direct that the transfer or disposal of all or any of the specified equity interest be restricted, subject to such conditions as the Board considers appropriate; | | (d) | make such other direction as the Board considers appropriate. |
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(3) Where the person mentioned in subsection (1) is an indirect controller of a designated entity, designated business trust or designated trust, the Board may do one or both of the following:| (a) | direct the person, or direct the designated entity, the trustee‑manager of the designated business trust or the trustee of the designated trust (as the case may be) to take such steps as are necessary, within such period as may be specified by the Board, to cease to be such an indirect controller or to cause the person to cease to be such an indirect controller, as the case may be; | | (b) | make such other direction as the Board considers appropriate. |
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(4) Where the person mentioned in subsection (1) has acquired as a going concern a business or an undertaking mentioned in section 44F(4), the Board may do one or both of the following:| (a) | direct the person to transfer or dispose of all or any part of the business or undertaking within such time and subject to such conditions as the Board considers appropriate; | | (b) | make such other direction as the Board considers appropriate. |
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(5) Before issuing any direction to a person under subsection (2), (3) or (4), the Board must —| (a) | unless the Board decides that it is not practicable or desirable to do so, give the person written notice of the Board’s intention to issue the direction and to specify a date by which the person may make written representations with regard to the direction; and | | (b) | consider every written representation from the person received on or before the specified date mentioned in paragraph (a). |
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| (6) The Board may, at any time, revoke, vary or discharge any direction under subsection (2), (3) or (4) or suspend the operation of any such direction. |
| (7) Any person who is aggrieved by the Board’s decision to issue a direction under subsection (2), (3) or (4) or to vary a direction under subsection (6) may, within 14 days after being informed of the decision, appeal to the Minister whose decision is final. |
| (8) Despite the fact that any appeal under subsection (7) is pending, any direction issued by the Board under subsection (2), (3) or (4) and any variation of a direction under subsection (6), takes effect from the date specified by the Board, unless the Minister otherwise directs. |
| (9) Any person who fails to comply with a direction issued by the Board under subsection (2), (3) or (4) (including a direction that is varied under subsection (6)) within the period specified by the Board, shall be guilty of an offence. |
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| Effect of remedial directions, etc. |
44H.—(1) Any direction issued to a person, and any condition imposed, under section 44G(2), (3) or (4) takes effect, despite —| (a) | the Business Trusts Act, the Companies Act and the Limited Liability Partnerships Act; | | (b) | anything in any listing rules as defined in section 2(1) of the Securities and Futures Act; and | | (c) | the provisions of the memorandum or articles of association, trust deed or other constitution of the designated entity, designated business trust or designated trust in question. |
(2) Without affecting subsection (1), where any direction is issued under section 44G(2) or (3), then, until the direction is carried out or is discharged, suspended or revoked —| (a) | the voting rights in respect of the specified equity interest that is subject to the direction are not exercisable unless the Board expressly permits those rights to be exercised; | | (b) | the voting power that the person to whom the direction is issued controls, whether alone or together with that person’s associates, in the designated entity, designated business trust or designated trust (as the case may be) is not exercisable unless the Board expressly permits that power to be exercised; | | (c) | no equity interest in the designated entity, designated business trust, or designated trust is to be issued or offered (whether by way of dividends or otherwise) in respect of the specified equity interest that is subject to the direction, unless the Board expressly permits that issue or offer; and | | (d) | no amount may be paid (whether by way of profits, income or otherwise) in respect of the specified equity interest that is subject to the direction, unless the Board expressly authorises that payment. |
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| (3) Subsection (2)(d) does not apply in the event of a winding up, dissolution or termination of the designated entity, designated business trust or designated trust, as the case may be. |
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| Restrictions on voluntary winding up, etc. |
44I.—(1) Despite any other written law —| (a) | a designated entity that is a corporation or a limited liability partnership cannot be wound up voluntarily without the consent of the Board; | | (b) | a designated entity that is a partnership cannot be dissolved —| (i) | by a partner giving notice to the other partner or other partners (as the case may be) of the partner’s intention to dissolve the partnership; or | | (ii) | by the partners agreeing to dissolve the partnership, |
| without the consent of the Board; |
| | (c) | a designated business trust cannot be wound up voluntarily without the consent of the Board; | | (d) | a designated trust cannot be wound up or terminated voluntarily without the consent of the Board; | | (e) | a person must not make any application under section 210 or 211I of the Companies Act in relation to a designated entity that is a corporation, unless that person has served 14 days’ notice in writing of his intention to make that application on the Board; | | (f) | no judicial management order under Part VIIIA of the Companies Act may be made in relation to a designated entity that is a corporation without the consent of the Board; | | (g) | a person must not take any step to enforce any security over a designated entity, the trust property of a designated business trust or the trust property of a designated trust, unless that person has served 14 days’ notice in writing of his intention to take that step on the Board; and | | (h) | a person must not take any step to execute or enforce any judgment or order of court obtained against a designated entity, designated business trust or designated trust, unless that person has served 14 days’ notice in writing of his intention to take that step on the Board. |
(2) The Board must be a party to —| (a) | any proceedings relating to the making of an order under section 210 or 211I of the Companies Act in relation to a designated entity that is a corporation; | | (b) | any proceedings relating to the making of a judicial management order under the Companies Act in relation to a designated entity that is a corporation; | | (c) | any proceedings under the Companies Act relating to the winding up of the affairs of a designated entity that is a company or an unregistered company; | | (d) | any proceedings under the Limited Liability Partnerships Act relating to the winding up of the affairs of a designated entity that is a limited liability partnership; and | | (e) | any proceedings before any court for the dissolution, winding up or termination (as the case may be) of any designated entity not mentioned in paragraph (c) or (d), or of any designated business trust or designated trust. |
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| (3) A court must, when deciding any proceedings mentioned in subsection (2), take into consideration any representations made by the Board in those proceedings. |
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| Penalties under this Division |
44J. A person guilty of an offence under this Division shall be liable on conviction —| (a) | in the case of an individual, to a fine not exceeding $500,000 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 $50,000 for every day or part of a day during which the offence continues after conviction; or | | (b) | in any other case, to a fine not exceeding $1 million and, in the case of a continuing offence, to a further fine not exceeding $100,000 for every day or part of a day during which the offence continues after conviction. |
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| Division 3 — Special administration order |
| Meaning and effect of special administration order |
44K.—(1) A special administration order is an order of the Minister, made in accordance with section 44L in relation to a designated entity, designated business trust or designated trust, directing that during the period for which the order is in force, the affairs, business and property of that designated entity, designated business trust or designated trust (as the case may be) is to be managed by a person appointed by the Minister (which may include the Board) —| (a) | for securing one or more of the purposes of such an order set out in subsection (2); and | | (b) | in a manner which protects the respective interests of the shareholders, unitholders or beneficiaries (as the case may be), and the creditors, of the designated entity, designated business trust or designated trust, as the case may be. |
(2) The purposes mentioned in subsection (1)(a) are the following:| (a) | the security and reliability of the supply of water in Singapore; | | (b) | the survival of the designated entity, designated business trust or designated trust (as the case may be), or the whole or any part of its business or undertaking, as a going concern; | | (c) | the transfer to another person, or (as respects different parts of its business or undertaking), to 2 or more different persons, as a going concern, of so much of the business or undertaking of a designated entity, designated business trust or designated trust as it is necessary to transfer in order to ensure that the obligations of the designated entity, the trustee‑manager of the designated business trust or the trustee of the designated trust (as the case may be) under or in respect of any contract with the Board —| (i) | to supply water to the Board; or | | (ii) | to collect, treat, recover or dispose of used water (including sewage, waste matter and effluent), |
| may be properly carried out; |
| | (d) | the carrying out of the obligations of the designated entity, the trustee‑manager of the designated business trust or the trustee of the designated trust (as the case may be) under or in respect of any contract with the Board —| (i) | to supply water to the Board; or | | (ii) | to collect, treat, recover or dispose of used water (including sewage, waste matter and effluent), |
| pending the making of the transfer, as a going concern, of the business or undertaking of the designated entity, designated business trust or designated trust to any other person or persons. |
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(3) The Minister may make regulations under section 72 for giving effect to this Division, including —| (a) | regulations governing the transfer of a business or an undertaking of a designated entity, designated business trust or designated trust referred to in subsection (2)(c); and | | (b) | where a special administration order is made, regulations for applying, omitting or modifying the provisions of Part VIIIA of the Companies Act. |
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| Power to make special administration order, etc. |
44L.—(1) If, on an application made to the Minister by the Board in relation to a designated entity, designated business trust or designated trust, the Minister is satisfied that any one or more of the grounds specified in subsection (2) are satisfied in relation to that designated entity, designated business trust or designated trust (as the case may be), the Minister may make any one or more of the following orders:| (a) | a special administration order in relation to that designated entity, designated business trust or designated trust, as the case may be; | | (b) | an order requiring the designated entity, the trustee‑manager of the designated business trust or the trustee of the designated trust (as the case may be) immediately to take any action or to do or not to do any act or thing in relation to the business or undertaking of the designated entity, the designated business trust or the designated trust as the Minister may consider necessary; | | (c) | an order appointing a person to advise that designated entity, the trustee‑manager of the designated business trust or the trustee of the designated trust (as the case may be) in the proper conduct of the business or undertaking of the designated entity, the designated business trust or the designated trust. |
(2) The grounds mentioned in subsection (1) are the following:| (a) | the designated entity, the trustee‑manager of the designated business trust or the trustee of the designated trust (as the case may be) is or is likely to be unable to pay its debts; | | (b) | the occurrence of a public emergency; | | (c) | the Minister considers it in the interest of the security and reliability of the supply of water in Singapore; | | (d) | the Minister considers it to be in the public interest. |
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(3) The Minister may make a special administration order in relation to a designated entity, designated business trust or designated trust, despite the commencement of (if applicable) —| (a) | any proceedings relating to the making of an order under section 210 or 211I of the Companies Act in relation to a designated entity that is a corporation; | | (b) | any proceedings relating to the making of a judicial management order under the Companies Act in relation to a designated entity that is a corporation; | | (c) | any proceedings under the Companies Act relating to the winding up of the affairs of a designated entity that is a company or an unregistered company; | | (d) | any proceedings under the Limited Liability Partnerships Act relating to the winding up of the affairs of a designated entity that is a limited liability partnership; or | | (e) | any proceedings before any court for the dissolution, winding up or termination (as the case may be) of any designated entity not mentioned in paragraph (c) or (d), or of any designated business trust or designated trust. |
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| (4) Notice of any application under subsection (1) must be given immediately by the Board to such persons and in such manner as may be determined by the Board. |
| (5) Any order made by the Minister under subsection (1) must be published in such manner as will secure adequate publicity. |
| (6) Any decision of the Minister under subsection (1) is final. |
(7) For the purposes of this section —| (a) | a designated entity that is a company is unable to pay its debts if it is deemed to be unable to pay its debts under section 254(2) of the Companies Act; | | (b) | a designated entity that is an unregistered company is unable to pay its debts if it is deemed to be unable to pay its debts under section 351(2) of the Companies Act; and | | (c) | a designated entity that is a limited liability partnership is unable to pay its debts if it is deemed to be unable to pay its debts under paragraph 3(2) of the Fifth Schedule to the Limited Liability Partnerships Act. |
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| (8) The Minister may at any time (whether or not the appointment of the person has terminated) fix the remuneration and expenses to be paid by the designated entity, the trustee‑manager of the designated business trust or the trustee of the designated trust (as the case may be) to any person appointed by the Minister under subsection (1)(c) to advise the designated entity, the trustee‑manager of the designated business trust or the trustee of the designated trust (as the case may be) in the proper conduct of its business or undertaking. |
(9) Where —| (a) | the Minister issues an order under subsection (1) to a designated entity, the trustee‑manager of a designated business trust or the trustee of a designated trust; and | | (b) | the designated entity, the trustee‑manager of the designated business trust or the trustee of the designated trust (as the case may be) fails to comply with that order, |
| the designated entity, the trustee‑manager of the designated business trust or the trustee of the designated trust (as the case may be) shall be guilty of an offence. |
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| Transfer of property, etc., under special administration order |
44M.—(1) Without limiting sections 44K and 44L, a special administration order may provide for the following matters:| (a) | the transfer of —| (i) | the property, rights and liabilities of a designated entity; | | (ii) | the trust property of the designated business trust, and the rights held and the liabilities incurred by the trustee‑manager of the designated business trust in its capacity as trustee‑manager of the designated business trust; or | | (iii) | the trust property of the designated trust, and the rights held and the liabilities incurred by the trustee of the designated trust in his capacity as trustee of the designated trust, |
| as the case may be, to one or more prescribed transferees; |
| | (b) | matters that are consequential or related to any such transfer. |
| (2) If the Minister makes a special administration order providing for any matter mentioned in subsection (1), the Minister must, within the time specified in subsection (4), by notification in the Gazette, establish a scheme for determining the amount of any compensation payable by the prescribed transferee to the designated entity, the trustee‑manager of the designated business trust or the trustee of the designated trust (as the case may be) for the transfer of the property, rights and liabilities. |
(3) A scheme established under subsection (2) may provide for —| (a) | the manner in which any compensation or consideration is to be assessed, including methods of calculation, valuation dates and matters to be taken into account or disregarded when making valuations; | | (b) | the assessment to be made by an independent valuer appointed by the Minister; and | | (c) | the remuneration and expenses of the independent valuer. |
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| (4) Subject to subsection (5), the time specified for the purposes of subsection (2) is within 6 months after the making of the special administration order mentioned in subsection (2). |
| (5) The time specified in subsection (4) may be extended by agreement of the prescribed transferee and the designated entity, the trustee‑manager of the designated business trust or the trustee of the designated trust (as the case may be) to which the scheme established under subsection (2) relates. |
(6) In this section, “prescribed transferee” means —| (a) | the Board; or | | (b) | a person nominated by the Board.”. |
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(2) Section 44I(1) of the principal Act, as inserted by subsection (1), is amended by inserting, immediately after paragraph (f), the following paragraph:| “(fa) | no interim judicial manager or judicial manager may be appointed under section 94 of the Insolvency, Restructuring and Dissolution Act 2018 in respect of a designated entity that is a corporation without the consent of the Board;”. |
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(3) Section 44L(3) of the principal Act, as inserted by subsection (1), is amended by inserting, immediately after paragraph (b), the following paragraph:| “(ba) | any meeting convened under section 94(7) of the Insolvency, Restructuring and Dissolution Act 2018 in respect of a designated entity that is a corporation;”. |
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