Hon Sui Sen
Singapore
“Sir, I must inform the Member for Rochore that the companies are run on the basis of private sector companies, i.e. their budgets are drawn up by their boards of directors. I do not know to what extent their budgets follow Government budgets but they are certainly not regulated in the sense that Government budgets are rigidly enforced.”
“Perhaps the Member is referring to PIE's operations with respect to the Armed Forces. PIE provides some of the supplies for feeding our army and other armed forces. If the private sector is equally viable, equally able to supply foodstuffs, I see no reason why they should not also compete with the PIE.”
“Jeyaretnam asked the Minister for the Environment and Minister for Communications if he will request the Port of Singapore Authority to consider providing transport alternatively paying a transport allowance to all employees of the PSA who have been moved out of the PSA Staff quarters in Blair Plain and as a result of which have been put…”
“INTRACO is a company in which the Government has some equity. I believe the proportion is somewhere around 20%. So in a sense it is not exactly a Government controlled company, although 20%, of course, is a fairly considerable share. In the case of PIE, the answer is yes, it is a Government company.”
“The dividend yields for the three holding companies were nil, The yields for the operating companies were nil for 34 companies (including eight which have yet to commence operations), 1% to 10% for five companies, more than 10% but less than 20% for 10 companies, and at least 20% for nine companies.”
“Sir, the simple answer to that is no, for the purpose of this Bill. This Bill merely enacts legislation to implement the 1982 Budget concessions.”
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“And total entrepot earnings made up about 11 per cent of the Gross Domestic Product in 1970 as against 19 per cent in 1960. This percentage may be expected to decline further as our industrial and economic base expands with domestic trade keeping up its steady rate of growth. Two factors may, however, explain the poorer entrepot performance in 1970 relative to 1969. First, despite the remarkable growth of world trade, the prices for rubber registered a downward trend in 1970. Consequently, the value of crude rubber exports fell by about $250 million. This was a fall of 17 per cent compared with the increase of 62 per cent in 1969 when rubber prices were on the uptrend. Secondly, our exports to South Vietnam fell by about $100 million. In spite of these adverse developments, however, there has been some slight increase in total export earnings because of the increase in the export of manufactures. This increase amounted to $433 million, more than sufficient to offset the fall in the value of exports of rubber and exports to Vietnam. Whilst export growth has been sluggish, imports have been buoyant. Concern has been expressed over the widening trade deficit and its possible repercussions on our balance of payments position. However, analysis of the trade and payments accounts suggests that there need be no undue anxiety because of the following considerations. First, for an economy with a small resource base enjoying rapid industrial growth, the buoyancy in imports is due largely to the fast pace of investment in imported capital goods.”
“Singapore products in increasing range and quality are now finding their way to markets in Europe and America. In Table V, the figures show that direct exports of manufactures rose from $1,265 million to $1,708 million in 1970, a gain of 35 per cent over 1969. The steady increase in investment, increasing the productive capacity of new industry and expanding existing industry has resulted in an increase in value-added output to $1,104 million in 1970 (see Table V). The Gross Domestic Product figures for manufacturing and quarrying in Table II show a growth of 29 per cent in 1970 as compared with the average annual increase of 22 per cent for 1965-69. Manufacturing industries now comprise slightly more than a fifth of the national economic cake compared to less than one-tenth a decade ago - see Table I1B. Their contribution to total employment is also significant. Preliminary census data covering establishments with 10 or more workers indicate that there were about 126,500 workers employed in manufacturing industries in 1970. This represents an increase of some 25,000 workers or 25 per cent over the previous year's 100,758 and against the average increase in employment for 1968-69 which was about 21,250. The utilities sector's contribution of $136 million to the Gross Domestic Product reflects the expansion of industrial consumption, particularly of electric power. Industry played the most dynamic role in the growth of our economy. Because of the stimulus given by industry towards trade in manufactured products, trade was the largest contribution to our Gross Domestic Product, 30 per cent for 1970. However, entrepot earnings in 1970 dropped by 4.5 per cent or about $30 million compared to the previous year.”
“Not only will this large investment ensure a sustained rate of economic growth for the future, but it is strong evidence of investors' confidence in the political stability of Singapore and its potential for profitable economic investment. Table IIIA shows that the largest portion of the Gross Fixed Capital Formation was in machinery and equipment, and in construction, both indicative of industrial investment. It may also be of interest to note that the private sector share of both consumption and capital expenditure is some 80 per cent. This ought to allay any incipient fears such as have been expressed sometimes of over-intrusion by Government into what is properly the private sector of the economy. Let us now return to the Gross. Domestic Product and examine the contribution of the various sectors shown in Tables II, IIA, and JIB. The agriculture and fishing sector continues to show the small but nevertheless welcome yearly increment. Its potential may, however, be limited. Vigorous efforts will continue to be made in developing the Jurong Fishing Port and in promoting deep-sea fishing. The next sector, manufacturing, on the other hand, continues to play an increasingly larger role in the economy. In 1970 more than one-third of the growth in Gross Domestic Product was the result of the growth in manufacturing output. Our industries are gradually moving away from the limited possibilities of import substitution on to the more promising fields of export promotion. We shall so gain a larger share in the benefits of expanding world trade in manufactures. The time has long passed since Singapore relied solely on her traditional entrepot outlets for her export markets.”
“This is only slightly less than the 14 per cent rate in the boom year of 1969, but account has to be taken of the fact that because of the increase in manufacturers' export prices, the increase in the actual volume of world trade was somewhat less than this. The rate of growth of world trade was nonetheless impressive, particularly in view of the recession which hit the American economy during 1970 and the prognostications of a possible world recession as a result. In the light of these fortuitous circumstances, our economy in 1970 was able to more than maintain the healthy level of economic activity achieved in the previous two years. According to preliminary estimates, which are given in Table II, the Gross Domestic Product, our best indicator of overall economic health, reached $5,565 million at factor cost, an increase of $730 million over 1969. This is an increase of some 15 per cent compared with the average annual growth of 14.5 per cent for 1968-69 and of 9.5 per cent for the past decade. I shall want to look more closely at the components which make up the total of $5,565 million Gross Domestic Product shown in Table II, but before doing so, it may be of interest to note the related or twin indicator of economic health, the Gross Domestic Expenditure shown in Table III. This gives the expenditure on all goods and services in the economy. At $5,707 million, the Gross Domestic Expenditure shows an absolute increase of $928 million or, percentage-wise, 16.3 per cent over 1969. More than half of this increase in Gross Domestic Expenditure is attributable to the growth in Fixed Capital Formation, which reached $1,403 million, a hefty increase of 41 per cent over 1969.”
“The major external factors then looming over the horizon and likely to affect the economy during the first half of the decade were the continued instability of the international monetary system, depressed share prices combined with inflation in the developed countries and, in consequence of these uncertainties, the expectation of a gradual slow-down in the growth of world trade. Domestically, there were the expected consequences of the British Government's decision to withdraw all its military forces from Singapore by the end of 1971. Added to this was the uncertainty as to the effects, both economic and political, of the accelerated run-down of American Armed Forces in Vietnam. In the event, whilst there was some cause for our apprehensions, the worst has been avoided in 1970 largely by a coincidence of favourable factors. The decision by the Labour Government for total military withdrawal from South-east Asia was reversed by the victory of the Conservative Party in the United Kingdom elections. The Conservative Government intention to maintain an effective presence in the area has given added strength to the Five-Power Defence arrangements for Malaysia and Singapore. It has resulted in greater confidence in businessmen and investors in the future of both countries. Instead of an expected $150 million loss in income, the reduction of British military spending also proved to be slight in 1970. (But the drop will be all the sharper in 1971!) World trade in value terms continued to expand, not in accordance with earlier GATT (General Agreement on Tariffs and Trade) estimates of a 4-8 per cent rate, but at the relatively high rate of 13 per cent.”
“Mr Speaker, Sir, I beg to move, That Parliament approves the financial policy of the Government for the financial year 1st April, 1971 to 31st March, 1972. In this budget statement, I propose to begin with an outline of the economic setting with particular reference to our performance in 1970, estimate future prospects, then deal with the estimates of expenditures, both current and development, before going on to consider the revenue or other methods of financing these expenditures. For the convenience of Members, I am circulating tables of statistics* on which I shall base my remarks. Members already have also two Memoranda+, one on the Ordinary Estimates and another on the Development Estimates, as well as the Estimates++ themselves. (*See Appendix, cols, 593-634) (+Papers. Misc. 1 and 2 of 1971) (++Papers Cmd. 3 and 4 of 1971) Appendix to Annual Budget Statement (Col.549) (Col 0593-0634) In order to prevent confusion among Members who may have cause to refer to previous published data, I should perhaps add here a word of explanation relating to the statistical tables. In many instances, the data has been revised on better information or on better classification and redistribution. For example, ship-repair services now come under manufacturing instead of entrepot trade in the statistics. Review of the Singapore Economy Contrary to expectations at the last budget, the year 1970 has been another very favourable year for Singapore. A quick look at the main economic and social indicators which are given in summary in Table I will be sufficient to confirm this. After the exceptionally prosperous last two years of the Sixties, we entered the new decade of the Seventies with some diffidence as to what the future would hold for us.”
“Sir, I beg to move. Question put, and agreed to. Resolved, That this Parliament, pursuant to subsection (1) of section 10A of the Civil List and Pension Act, 1970 (Act 10 of 1970), resolves that there be paid to the widow and to the two undermentioned children of the late President Yusof bin Ishak, with effect from the 23rd day of November, 1970, the following amounts of pension appearing against their respective names:- (a) Che Puan Noor Aisha, the sum of $24,000. - (Dollars twenty-four thousand) per annum, subject to subsection (3) of the aforesaid section; and (b) Che lmran bin Yusof (born on 26th November, 1950) and Che Zuriana Yusof Ishak (born on 6th February, 1953), jointly the sum of $6,000.-(Dollars six thousand) per annum, which sum shall cease to be paid to them upon Che Zuriana Yusof Ishak attaining the age of twenty-one years or upon her marrying, whichever is the earlier: Provided that should Che Zuriana Yusof Ishak marry before attaining the age of twenty-one years, the whole of the sum of $6,000.-(Dollars six thousand) per annum shall be paid to Che Imran bin Yusof until he attains the age of twenty-one years. ADJOURNMENT Resolved, "That Parliament do now adjourn to a date to be fixed."-[Mr Hon Sui Sen]. Adjourned accordingly at Twelve minutes to Four o'clock p.m. to a date to be fixed.”
“Mr Speaker, Sir, I beg to move the motion* set down as item No. 8 on the Order Paper. * The motion reads as follows: That this Parliament, pursuant to subsection (1) of section 10A of the Civil List and Pension Act, 1970 (Act 10 of 1970), resolves that there be paid to the widow and to the two undermentioned children of the late President Yusof bin Ishak, with effect from the 23rd day of November, 1970, the following amounts of pension appearing against their respective names: - (a) Che Puan Noor Aisha, the sum of $24,000.-(Dollars twenty-four thousand) per annum, subject to subsection (3) of the aforesaid section; and (b) Che Imran bin Yusof (born on 26th November, 1950) and Che Zuriana Yusof Ishak (born on 6th February, 1953), jointly the sum of $6,000.- (Dollars six thousand) per annum, which sum shall cease to be paid to them upon Che Zuriana Yusof Ishak attaining the age of twenty-one years or upon her marrying, whichever is the earlier: Provided that should Che Zuriana Yusof Ishak marry before attaining the age of twenty-one years, the whole of the sum of $6,000.- (Dollars six thousand) per annum shall be paid to Che Imran bin Yusof until he attains the age of twenty-one years.' Mr Speaker. Sir, the purpose of my motion is already clear to Members from the Prime Minister's speech on the Second Reading of the Civil List and Pension (Amendment) Bill which was taken at the last sitting of Parliament. The Bill has been passed. It has received the President's assent and the Act (No. 10 of 1970) came into operation on 6th January, 1971. It therefore now becomes possible to grant a pension to the late President's widow as well as to his surviving children of such amount or amounts and subject to such terms as Parliament may, by its resolution, determine.”
“The date for the coming into operation of the proposed amendment has been fixed at the 1st day of December, 1970, so as to cover the loan for the Singapore International Airport Expansion Project and the other two subsequent loans which I have mentioned. The amendment will also serve to provide a more satisfactory legal basis and machinery for future loans from the Asian Development Bank. Mr Speaker, Sir, I beg to move. Question put, and agreed to. Bill accordingly read a Second time and committed to a Committee of the whole House. The House immediately resolved itself into a Committee on the Bill. -[Mr Hon Sui Sen]. Bill considered in Committee. [Mr Speaker in the Chair] 3.45 p.m. Clause 1 -”
“Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time." The Bill seeks to amend the Loans (International Bank) Ordinance, 1958, of Malaysia, which was extended to Singapore in 1964 when Singapore was part of Malaysia. The present Ordinance enables the Government and statutory authorities to borrow from the International Bank for Reconstruction and Development, and also for the Government to guarantee loans made by the Bank to statutory authorities. The Ordinance also lays down the manner in which such loan and guarantee agreements may be concluded. The purpose of the Bill now before this House is to extend the provisions of the Ordinance to cover loans made by the Asian Development Bank to the Government and to statutory authorities in Singapore. Members will recall that a number of loan agreements have recently been negotiated with the Asian Development Bank and, whilst the present constitutional and legislative powers of Government are sufficient to enable the signing of such loan agreements, the Asian Development Bank has requested that it be accorded the same status as the World Bank under the Loans (International Bank) Ordinance, 1958. This is felt to be justified in view of the significant assistance that is being accorded Singapore by the Asian Development Bank. To date the Asian Development Bank has agreed to lend a sum of US$20.5 million to finance the expansion of Singapore International Airport. The Bank has also agreed to grant two further loans -~ one of US$3 million to the Government to finance the expansion of Ngee Ann Technical College, and the other of US$8.3 million to the Public Utilities Board, with the Government as guarantor, to finance the Kranji / Pandan Water Supply Project.”
“This provision is unduly restrictive and it is proposed, under clause 9, to allow the Corporation, with the approval of the Minister, to invest in shares of any private or public company. Clause 10, which introduces a new section 27A in the principal Act, allows the Corporation to form subsidiary companies for the purpose of carrying out any of the functions of the Corporation. It may be desirable in certain circumstances, not only in the interests of flexibility of operation but also of financial accountability, to separate some of the Corporation's functions from the others and to entrust them to companies in which the Corporation would have a majority interest. Members will notice that, under subsection (3) of the proposed new section 27A, the operations of such companies would be subject to detailed supervision by the Minister. Clauses 11 and 12, which introduce another new section in the principal Act, confer on the Corporation the exclusive right to the use of the symbol which is set out in the proposed Schedule to the principal Act. This symbol has already been in use for some time and is, I am sure, familiar to all Members. Mr Speaker, Sir, I beg to move. Question put, and agreed to. Bill accordingly read a Second time and committed to a Committee of the whole House. The House immediately resolved itself into a Committee on the Bill. -(Mr Hon Sui Sen]. Bill considered in Committee [Mr Speaker in the Chair] 3.39 p.m. Clause 1 -”
“It is proposed, under clauses 4, 5, 6, 7 and 8 of the Bill, to delete these references and substitute references to the Corporation itself, as the principal Act does not actually provide for the setting up of a Jurong Town Corporation Fund. Clause 5 alters the manner of appointment of the Corporation's auditor. Section 21 of the principal Act provides that the Minister shall nominate for every year an auditor of the Corporation's accounts. It is proposed that, as in the case of other statutory bodies, the Corporation's auditor should be appointed, not by the Minister but by the Corporation itself with the concurrence of the Minister. Clause 6 amends section 23 of the principal Act so that the Corporation will now be required to submit its annual statement of accounts to the Minister and the auditor will be required to submit separately his report on the statement of accounts. Both the statement of accounts and the auditor's report thereon shall be published in the Gazette. This introduces a measure of public accountability and is an improvement on the existing provision which only requires the auditor to certify the Corporation's statement of accounts. Clause 7 amends section 24 of the principal Act to make it clear that the accounting records of the Corporation should distinguish capital transactions from revenue transactions and that moneys received by way of loans should be shown separately. The marginal note is amended because the provisions of the section deal not only with bank accounts but with accounting records as well. Section 27 of the principal Act provides that the Corporation may invest any money standing to its credit in any trustee securities.”
“Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time." The Bill seeks to amend the Jurong Town Corporation Act, 1968, in the light of experience gained over the last 2« years. These amendments are in addition to those which were introduced, as a matter of urgency, under the Jurong Town Corporation (Amendment) Act, 1970, in September last year. Clause 2 of the Bill sets the 4th day of September, 1970, as the date of coming into operation of the 1970 Amendment Act. Members will recall that the 1970 Amendment Act empowered the Jurong Town Corporation, among other things, to raise loans from outside sources. The present amendment before this House is necessary to give legal validity to the signing of the Loan Agreement between the Jurong Town Corporation and the Asian Development Bank on the 5th September, 1970. The Bank agreed to lend the Corporation a sum of US $8.3 million to finance the expansion of Jurong wharves. It is proposed to set the 4th day of September, 1970 - the day immediately preceding the date of signature of the Loan Agreement - as the date of coming into operation of the Jurong Town Corporation (Amendment) Act, 1970. Clause 3 amends section 13 of the principal Act which lays down the duties and powers of the Corporation. Paragraphs (a) , (b) and (c) are drafting amendments. Paragraph (d) empowers the Corporation to sell or lease flats, houses or other living accommodation. This is necessary to enable the Corporation to undertake the housing of workers in Jurong. There are references, in sections 17, 21, 23, 24 and 25 of the principal Act, to a "Jurong Town Corporation Fund".”
“Bill reported with amendments; read a Third time and passed. PASSPORTS BILL Order for Second Reading read. 9.36 p.m.”
“Sir, I beg to move, In page 26, line 29, to leave out from "18." to the end of line 37 and insert a new provision* as set out in the Order Paper Supplement. * The provision, appearing in the Order Paper Supplement, reads as follows: "Section 364 of the principal Act is hereby amended - (a) by deleting the words " a statement false in any material particular knowing it to be false" appearing in the third and fourth lines of subsection (2) thereof and substituting therefor the words " or authorises the making of a statement false or misleading in any material particular knowing it to be false or misleading or wilfully omits or authorises the accession of any matter or thing without which the document is misleading in a material respect"; and (b) by inserting immediately after subsection (2) thereof the following new subsection:- "(3) For the purpose of subsection (2) of this section where a person at a meeting votes in favour of the making of a statement referred to in that subsection he shall be deemed to have authorised the making of that statement.".". Sir, clause 18 amends section 364 of the Companies Act, which deals with false and misleading statements. Subsection (2) of section 364 provides that if a person in any return, report or balance sheet, makes a false statement, he is guilty of an offence. It is now proposed by this amendment that a new subsection (3) be inserted to make it clear that if a person at a meeting votes in favour of making a statement referred to in subsection (2) , he shall be deemed to have authorised the making of that statement, and shall be guilty of an offence. Amendment agreed to. Clause 18, as amended, ordered to stand part of the Bill. Clause 19 ordered to stand part of the Bill.”
“Sir, I beg to move, In page 23, after line 46, to insert a new sub-clause* as set out in the Order Paper Supplement. *The sub-clause, appearing in the Order Paper Supplement, reads as follows: "(2) The Registrar may where he considers it appropriate make an order in respect of a specified class of companies relieving the directors of a company in that class from compliance with any specified requirements of this Act relating to content of the report required by subsection (6) of section 169 of this Act and the order may be made either conditionally or on condition that the directors of the company comply with such other requirements relating to the form and content of accounts or consolidated accounts or report as the Registrar thinks fit to impose.". Sir, clause 12, which inserts a new section 1 69A, deals with the power of the Registrar to grant relief to directors of a corporation from the requirements as to the form and content of accounts or consolidated accounts, etc. An amendment is proposed which will have the effect of enabling the Registrar to exempt directors of a specified class of companies, for example, private companies, from compliance with specified requirements of this Act relating to the form and content of the accounts. Amendment agreed to.”
“Sir, I beg to move, In page 15, line 20, after "officer" where it secondly occurs, to insert "or". This again is a formal drafting amendment to correct a typographical error. Amendment agreed to. Clause 9, as amended, ordered to stand part of the Bill. 9.30 p.m. Clauses 10 and 11 ordered to stand part of the Bill. Clause 12 -”
“Sir, I beg to move, In page 15, line 6, after "or" to insert "on his own". Amendment agreed to.”
“Sir, it will be appropriate at this stage to refer to the amendment which the Member for Katong has suggested. With your consent and the general assent of the House, I would like to move that in page 15, line 6, after "or", to insert "on his own".”
“Sir, I beg to move, In page 14, line 43, to leave out the full-stop and insert -" "; and (d) by renumbering the existing subsections (5) and (6) thereof as subsections (4) and (5), respectively.". These are formal drafting amendments designed to correct typographical errors. Amendment agreed to.”
“Sir, I beg to move, In page 14, line 39, to leave out "second" and insert "first". Sir, this is a formal drafting amendment designed to correct an obvious error. Amendment agreed to.”
“Sir, I beg to move, In page 8, after line 36, to insert - "(3) For the purposes of subsection (1) of this section where a substantial shareholder in a company acquires or disposes of voting shares in the company there shall be deemed to be a change in the interest or interests of the substantial shareholder in the voting shares in that company.". Sir, the purpose of this amendment is to add a new subsection (3) to the proposed section 69E to make it clear that the change in the interests of a substantial shareholder in the voting shares in a company takes place where the substantial shareholder acquires or disposes of voting shares in the company, and thus ensures that the substantial shareholder is under an obligation to notify the particulars of this change in his interests. Amendment agreed to. Mr Hon Sui Sen: Sir, I beg to move, In page 9, after line 32, to insert - "(4) Nothing in this section affects the operation of section 69a of this Act.". Sir, section 69H deals with a person holding voting shares in which a person who is not resident in Singapore has an interest and places an obligation on the first mentioned person to serve a notice in the prescribed form as to the requirements of the Division of the Act. The amendment introduces a new subsection (4) which confirms that nothing in section 69H affects the obligation of the person to comply with this Division, even though he is not resident in Singapore. Amendment agreed to. Clause 6, as amended, ordered to stand part of the Bill. Clause 7 ordered to stand part of the Bill. Clause 8 -”
“Sir, I beg to move, In page 8, line 7, after "including", to insert "unless the interest or interests cannot be related to a particular share or shares". Sir, the proposed new section 69o deals with the obligation of a substantial shareholder to notify the company of his interests and the name and address and full particulars of his interests, including the name of the person who is registered as the holder. The amendment to this subsection proposes that he must give the latter the piece of information only where the interest can be related to a particular share or shares. Amendment agreed to.”
“Sir, I beg to move, In page 7, line 34, after "one-tenth of", to insert "the aggregate of". This is a drafting amendment which seeks to correct a typographical error. Amendment agreed to.”
“Sir, I beg to move, In page 6, lines 34 and 35, to leave out "the Stock Exchange of Malaysia and Singapore" and insert - " a stock exchange as defined Act of 1970 in the Securities Industry Act, 1970;". Sir, this again is a drafting amendment designed to relate the provisions in this section to those of the Securities Industry Bill. The definition of a "stock exchange" in the Securities Industry Bill includes but is not confined to the Stock Exchange of Malaysia and Singapore. The effect of this amendment would be to extend the meaning of the word "company" to a company whose shares are listed in any approved stock exchange. Amendment agreed to.”
“Sir, I beg to move, In page 4, line 4, to leave out "likely" and insert "is under an obligation whether formal or informal". Sir, the use of the words "likely to act" in relation to control of a corporation by directors where the corporation has an interest in the shares would lead to difficulties in interpretation. It is considered that the substitution of the words is under an obligation whether formal or informal" is more specific and will remove the difficulties in interpretation. Amendment agreed to. Further amendments made: In page 4, line 26, to leave out "likely" and insert "is under an obligation whether formal or informal".-[Mr Hon Sui Sen]. In page 4, line 29, to leave out "likely" and insert "is under an obligation whether formal or informal".-[Mr Hon Sui Sen]. In page 4, line 34, to leave out "likely" and insert "under an obligation whether formal or informal".-[Mr Hon Sui Sen]. In page 4, lines 41 and 42, to leave out "accustomed or likely" and insert "under an obligation whether formal or informal".- [Mr Hon Sui Sen]. Clause 4, as amended, ordered to stand part of the Bill. Clause 5 ordered to stand part of the Bill. Clause 6 -”
“Sir, I beg to move, In page 3, lines 34 to 41, to leave out subclause (3) and insert - "(3) Where a right (being a right or an interest described in the definition of "interest" in section 84 of this Act) - (a) was issued or offered to the public for subscription or purchase, or where the public was invited to subscribe for or purchase such a right, and the right was so subscribed for or purchased; or (b) was issued for the purpose of an offer to the public by and is held by the management company within the meaning of that section, that right does not constitute an interest in a share.". Sir, this amendment is proposed to remove a doubt as to whether a right, being an interest in shares as defined in section 84 of the Companies Act, which was issued for the purpose of an offer to the public and which is held by a management company as defined in that section, is an interest in shares under this section. This would cover a right to units under a unit trust scheme and is relevant as regards the application of the new section 69A dealing with substantial shareholdings. As at present drafted, it is not clear that such a right does not constitute an interest in a share. Amendment agreed to. 9.15 p.m.”
“Sir, I beg to move, In page 3, lines 31 and 32, to leave out "has an interest under the trust" and insert "knows or has reasonable grounds for believing that he has an interest under the trust and the property subject to the trust consists of or includes those shares". Sir, this amendment is of a drafting nature and is designed to remove doubts in or improve the wording of the proposed new section 6A of the Companies Act. The words "has an interest under the trust" have been most specifically drafted to convey the idea that a person must know or must have reasonable grounds for believing that he has an interest under the trust before it can be said that that person has an interest in shares, the subject of the trust. Amendment agreed to.”
“Sir, I am much obliged to the Member for pointing out the deficiency in the drafting of the Bill in page 15, line 6. At the appropriate time, I will, with the general assent of the House, move the amendment which he has suggested. With regard to the Member's second point on enforcement machinery, the position is that as the new provisions have not yet been passed I have not set up any machinery as yet. But on the passing of the Bill, I will certainly set up the appropriate machinery to see that administration of the Bill will be adequate. Question put, and agreed to. Bill accordingly read a Second time and committed to a Committee of the whole House. The House immediately resolved itself into a Committee on the Bill. -[Mr Hon Sui Sen]. Bill considered in Committee. [Mr N. Govindasamy in the Chair] 9.11 p.m. Clauses 1 to 3 inclusive ordered to stand part of the Bill. Clause 4 -”
“Clauses 18 and 19 deal with the fourth main topic of the Bill, namely, offences for false or misleading statements and false reports by officers of a company. The existing provision under section 364 of the Act is extended, under clause 18 of the Bill, to the authorising of the making of false or misleading statements or wilfully omitting any thing without which the document is misleading. Clause 19 introduces an important amendment in that it provides for the first time for a specific offence for an officer of a corporation to make any false or misleading statement or report to a director, auditor, member, debenture-holder or trustee for debenture-holders or to the auditor of a holding company or to a stock exchange in Singapore or elsewhere. In the past, the obligations under the Companies Act have been mainly confined to obligations in relation to documents filed with the Registrar or to be laid before the company in general meeting. This provision acknowledges that certain office-holders and stock exchanges also have a real interest in not being deceived as to the position of the company. Sir, our Companies Act is modelled on the Australian and United Kingdom Companies Acts and, therefore, reports by expert committees on the provisions and the working of these Acts in Australia and the United Kingdom are of direct relevance to our own Company law. The inspiration for the amendments proposed in this Bill has come, in the main, from the recommendations made by the Jenkins Committee in the United Kingdom and the Eggleston Committee in Australia. Sir, I beg to move. Question proposed. 9.07 p.m.”
“Also, the obligation imposed upon directors to inform the company of shareholdings in the company is extended to cases in which directors have a contingent or reversionary interest in shares or any other interest in the company. I would like to draw the attention of Members to the provisions of clause 12 of the Bill which gives the Registrar of Companies the power to relieve the directors of a particular company from any requirements of the Act relating to the form and content of accounts or to the form and content of directors' reports. This clause, in recognition of the fact that it may not be appropriate in every case for the information to be disclosed or to be disclosed in the required manner, allows the Registrar of Companies to substitute different requirements where such a course appears appropriate. Clause 13 increases the penalty where a director, with fraudulent intention, fails to comply with the provisions of the Act dealing with disclosure by directors and the keeping of accounts. The third main topic of the Bill is concerned with amendments to Part IX of the Act dealing with company investigations. Clause 17, which repeals and re-enacts section 208 of the Act with modifications, enables the Minister to require information as to persons interested in shares or debentures of a corporation, including a banking or insurance corporation, without the necessity of appointing an inspector. The new section 208 confers wide powers to investigate holdings where the Minister thinks fit so to do. Clause 15, which amends section 194 of the Act, defines the "affairs" of a company for the purposes of an investigation under Part IX of the Act. Clause 16 permits an inspector, with the consent of the Minister, to extend his investigation to a related company.”
“The new section will cover cases where an officer of a company buys or sells in anticipation of a favourable or unfavourable announcement or in cases where the confidential information is not intended to be released or is to be released at a later date. Clause 8, which amends section 132 of the Act, makes it clear that the section deals with misuse of information by an officer and not, for example, with cases where an authorised disclosure of information has resulted in detriment to the company. The next main topic of the Bill is the disclosure by directors of information to be included in the directors' report. Clause 11, which amends section 169 of the Companies Act, requires that the directors' report shall, in future, include: (a) details and purposes of any share issue during the financial years; (b) interests acquired by directors in any shares or debentures during the financial year; (c) the number and amount of shares acquired by directors, whether in the company or in a subsidiary or a holding company, details of which appear in the Register of Directors' Shareholdings; (d) details of the financial affairs of the company and of the accounts of the Company as well as any contracts made by the company with a director or any firm in which a director is a member or with a company in which a director has substantial financial interest. Under clause 10, which amends section 134 of the Act, criteria that have been applied to the registration of substantial shareholders are, with modifications, applied to the Register of Directors' Shareholdings.”
“If a company or a substantial shareholder fails to comply with these requirements, the company or the substantial shareholder, as the case may be, shall be guilty of an offence and liable to a penalty of $3,000 and, in the case of a continuing offence, to a further penalty of $500 for every day the offence continues. It is further provided that if a substantial shareholder fails to comply with these requirements, the Court may, on the application of the Minister, make an order restraining dealing in the shares or direct the sale of the shares or direct the company not to register a transfer of the shares. Clause 4, which introduces a new section 6A in the Companies Act, defines an "interest in shares" for this purpose. The degree of detail in the definition gives an indication of the scope of clause 6 of the Bill. Sir, the reasons for requiring disclosure of substantial shareholdings in the case of listed companies are that shareholders are entitled to know - (a) whether there are in existence substantial holdings of shares which might enable a single individual or corporation, or a small group, to control the destinies of the company; and (b) if there are such substantial holdings, who the persons are on whose exercise of voting power the future of the company may depend. Disclosure of substantial shareholdings is now required in the United States of America, the United Kingdom and in certain states in Australia. Clause 7, which introduces a new section 132A, makes an officer of a company, who takes advantage of special confidential information to enter into a transaction with another person, liable to any person who can show that he suffered loss by reason of a fall in value of the subject matter of the transaction.”
“Sir, I beg to move, "That the Bill be now read a Second time." The Companies (Amendment) Bill, which is a necessary adjunct to the Securities Industry Bill, deals with four main topics in the field of Company law, namely, (i) disclosure of substantial share-holdings in companies listed on the Stock Exchange; (ii) disclosure, by the directors of a company, of information to be included in the directors' report; (iii) company investigations; and (iv) offences for spreading false or misleading statements by the officers of a company. The provisions of the Bill would considerably strengthen the Companies Act which already contains extensive provisions on investor protection. With reference to the first topic, clause 6 of the Bill introduces a new Division 3A to the Companies Act. The provisions of the new Division require that the acquisition or existence of substantial shareholdings - which is defined for this purpose as 10 per cent or more of the voting shares in a company - should be disclosed to the management and other shareholders. A substantial shareholder is required to give notice in writing to the company of full particulars of his holding, and the company in turn is required to keep a register of substantial shareholders which will be open to inspection by shareholders and members of the public. These provisions apply to all persons, whether resident in Singapore or elsewhere, and to all holdings, whether direct or indirect. So that foreign investors will know of their obligations, nominee companies and trustees are required to inform persons for whom they hold shares of the requirements of the legislation.”
“Sir, I beg to move, "That the clause be read a Second time." Whereas the provisions of Parts II to V of the Bill apply largely to dealers and their representatives, the provisions of Part VII of the Bill-Trading in securities-apply to any member of the public. In the same manner that the new clauses 72 and 73 provide for offences by holders of licences, the new clause 74 provides for offences by members of the public. If it appears to a Judge of the High Court, on an application by the Registrar, that any person has committed an offence under Part VII of the Bill, the Judge may, by order, cause the books of a dealer to be inspected if he considers that relevant evidence can be found in the dealer's books. The new clause 74, like the new clauses 72 and 73, is necessary for the efficient administration and enforcement of the provisions of the Bill. Sir, I beg to move. Question put, and agreed to. Clause read a Second time and added to the Bill.”
“Sir, I beg to move, "That the clause be read a Second time." Sir, the new clause 72 confers on the Registrar certain powers to ensure that the holder of a licence abides by the provisions of the Bill. The new clause 73 lays down what action can be taken if it appears to the Registrar that the holder of a dealer's licence is or is likely to be in breach of the law. The clause provides that in such circumstances the High Court may, on the application of the Registrar, make one or more of a number of orders. Before making any order, however, the Court shall satisfy itself that the order would not unfairly prejudice any person. Contravention of any order so made is an offence punishable with a fine of $3,000 or imprisonment for a term not exceeding one year or both such fine and imprisonment. Question put, and agreed to. Clause read a Second time and added to the Bill.”
“Sir, I beg to move, "That the clause be read a Second time." Under clause 12 of the Bill, the Registrar of Companies has the power to grant or renew a licence subject to such conditions or restrictions as he thinks fit. Under clause 15 the Registrar may also take steps with a view to revoking a licence. It is important, therefore, that the Registrar should also have the necessary authority to ascertain whether the holder of a licence has complied with the provisions of the law and also whether he has complied with any conditions or restrictions subject to which his licence was granted or renewed. For this purpose New Clause (A) [the new clause 72] empowers the Registrar to inspect the books and documents of, and to require that information be supplied to him by, the holder of a licence. In addition, the Minister may appoint an inspector to investigate any matter concerning trading or dealings in securities. Sir, I beg to move. Question put, and agreed to. Clause read a Second time and added to the Bill.”
“Sir, I should like to point out that in line 2 of sub-clause (7) of New Clause (A)t shown in the Order Paper Supplement, there is a typographical error in which the word "and" should read "any". May I have the consent of the House to make this amendment, of which I have not given notice? Hon. Members indicated assent.”
“Sir, I beg to move, In page 20, line 4, after "in", to insert "Malaysia or". The purpose of this amendment is to allow the Stock Exchange to maintain two bank accounts, one in Singapore and another in Malaysia in respect of the fidelity fund. The fidelity fund can be applied to meet the liabilities of any member firm of the Exchange irrespective of whether the member firm is based in Singapore or Malaysia. It is considered expedient that the Exchange should, in the circumstances, be free to operate bank accounts in both territories. Amendment agreed to. Clause 45, as amended, ordered to stand part of the Bill. Clauses 46 to 75 inclusive ordered to stand part of the Bill. New Clause (A) -”
“Sir, I beg to move, In page 11, line 21, to leave out from "(1) " to the end of line 33 and insert the provisions* as set out in the Order Paper Supplement. * The provisions, appearing in the Order Paper Supplement, read as follows: " A dealer shall within six months of the end of the financial year lodge with the relevant authority an auditor's report containing information on such matters as are prescribed. (2) If a dealer fails to comply with the provisions of subsection (1) of this section the relevant authority shall forthwith report the matter to the Minister. (3) For the purposes of subsection (1) of this section "financial year" in relation to a dealer means the period of twelve months ending on the date on which his accounts were closed for the year ending on the 31st day of December, 1970.". Sir, the purpose of this amendment is to reduce the period allowed for the lodging of an auditor's report from nine months to six months after the end of a financial year. It also allows stock brokers to carry on with their existing financial years. The clause, as originally drafted, would have had the effect of compelling stock brokers to adopt a uniform financial year. This is unnecessary for the purposes of the Bill. Amendment agreed to. Clause 24, as amended, ordered to stand part of the Bill. 8.45 p.m. Clauses 25 to 44 inclusive ordered to stand part of the Bill. Clause 45 -”
“Sir, I beg to move, In page 8, line 22, to leave out from "(1) " to the end of line 28 and insert the provisions* as set out in the Order Paper Supplement. + The provisions, appearing in the Order Paper Supplement, read as follows: " Any person who is aggrieved by any decision of the Registrar under this Part may appeal to the Minister and any person who is aggrieved by a decision of a Court under section 15 and this Act may appeal to the High Court so long as the appeal in each case is made within thirty days of the decision of the Registrar or the Court, as the case may be. (2) In any appeal under this section the decision of the Minister or the Court as the case may be, shall be final and shall be given effect to by the Registrar.". Sir, this amendment alters the procedure for appeal in the event of an application for the issue or renewal of a licence being refused by the Registrar of Companies. An aggrieved applicant will now have to appeal to the Minister whose decision shall be final. If, however, during the currency of the licence the Registrar decides to revoke the licence, he can only do so with the leave of a District Court. An appeal against a decision of a District Court shall lie in the High Court. Amendment agreed to. Clause 16, as amended, ordered to stand part of the Bill. Clauses 17 to 23 inclusive ordered to stand part of the Bill. Clause 24 -”
“Sir, I beg to move, In page 7, line 26, to leave out "thirty" and insert "one hundred". Sir, this amendment increases the deposit to be made by a dealer, who is not a stock broker, from $30,000 to $100,000. It is considered appropriate that the deposit should be so increased in view of the fact that dealers who are not stock brokers do not have to comply with the stringent requirements of the rules of the Stock Exchange or to observe the financial discipline to which stock brokers are subject. It is not envisaged, however, that licences will be granted to more than a few such dealers who are not stock brokers. Amendment agreed to. Clause 13, as amended, ordered to stand part of the Bill. Clauses 14 and 15 ordered to stand part of the Bill. Clause 16 -”
“Sir, I beg to move, In page 7, line 4, to leave out "is an individual" and insert `carries on business as a dealer and is a stock broker". Sir, the purpose of this amendment, together with the next amendment, is to make it clear that dealers' licences will be issued to individual partners or directors of member firms of a stock exchange, and not to the firms as such. This follows the practice in other professions, such as law and medicine, in which licences are issued to individuals and not to partnerships or companies. In the case of a corporate dealer who is not a member firm, however, a licence may still be issued to a corporation. Amendment agreed to. Mr Hon Sui Sen: Sir, I beg to move, In page 7, line 7, to leave out "is a corporation" and insert "carries on the business of a dealer as a corporation but is not a member company". Sir, this amendment should be taken together with the previous amendment, the purpose of which I have already explained. Amendment agreed to. Clause 10, as amended, ordered to stand part of the Bill. Clauses 11 and 12 ordered to stand part of the Bill. Clause 13 -”
“Sir, I beg to move, In page 5, line 3, to leave out "twenty" and insert "ten". Sir, it is considered that, for a place the size of Singapore, twenty is too large a number of brokers required to constitute a stock exchange. The amendment reduces the prescribed minimum number of members from 20 to 10. As a matter of fact, the Stock Exchange of Malaysia and Singapore itself has only 13 Singapore-based member firms. Amendment agreed to. Clause 4, as amended, ordered to stand part of the Bill. Clause 5 -”
“Sir, I beg to move, In page 4, line 31, after "shall", to insert "be". This amendment corrects a typographical error. Amendment agreed to. Clause 3, as amended, ordered to stand part of the Bill. Clause 4 -”
“Sir, I beg to move, In page 4, after line 13, to insert the definition of "unit trust scheme"+ as set out in the Order Paper Supplement. +The definition, appearing in the Order Paper Supplement, reads as follows: ""unit trust scheme" means any arrangement made for the purpose, or having the effect of providing facilities for the participation by persons as beneficiaries under a trust, or profits or income arising from the acquisition, holding, management or disposal of securities or any other property." Sir, this amendment introduces the definition of "unit trust scheme" consequent upon the inclusion under an earlier amendment of the managers of such schemes in the definition of "exempt dealers". Amendment agreed to.”
“Sir, I beg to move, In page 3, line 34, to leave out "funds, stock, shares" and insert "stocks and shares in a public company or corporation, funds". Sir, the definition of "securities" includes the shares of private companies as well as those of public companies. II has been represented that it would be unduly restrictive to apply the provisions of the Bill to dealings in shares of private companies. It is considered proper that shares of private companies be excluded from the definition of securities, as the primary purpose of the Bill is to regulate dealings in the shares of quoted public companies. The amendment would exclude shares of private companies from the definition of securities. Amendment agreed to. 8.30 p.m.”
“Sir, apart from the managers of unit trusts, there is another category of persons, namely, merchant banks, whose activities include the business of dealing in securities as defined in the Bill. It is not proposed, however, that the provisions of the Bill, which are designed primarily for stock brokers and other dealers, should apply to merchant banks. The amendment seeks to include merchant banks in the definition of an exempt dealer. Amendment agreed to.”
“Sir, I beg to move, In page 2, after line 44, to insert - " (b) any person acting in the capacity of manager or trustee under a unit trust scheme a deed in respect of which is approved by the Registrar or the Act 42 Minister under Division 5 of Part IV of 1967 of the Companies Act, 1967;". Sir, managers of unit trusts buy and sell units which are deemed to be securities for the purpose of the Bill directly and not through dealers. Hence, they would fall within the definition of a "dealer". It is not proposed, however, that the provisions of the Bill should apply to this category of persons as their duties and responsibilities are already laid down under the Companies Act. The amendment seeks to include managers of unit trusts in the definition of an "exempt dealer". Amendment agreed to. Mr Hon Sui Sen: Sir, I beg to move, In page 3, line 5, at end, to add "or" and a new paragraph (e) * as set out in the Order Paper Supplement. * The new paragraph (e) , appearing in the Order Paper Supplement, reads as follows: "(e) such other person or class of persons as the Minister may by order declare to be an exempt dealer if the main business carried on by such person or class of persons is a business other than the dealing in securities, and if the dealing in securities is by way of - (i) making or offering to make with any person an agreement for or with a view to the underwriting of securities; (ii) making an invitation to persons to subscribe for securities or to purchase securities on the first sale thereof; Act 42 (iii) issuing any document which is or is deemed of 1967 to be a prospectus within the meaning of the Companies Act, 1967; or (iv) such other way as the Minister may from time to time declare;".”
“Sir, I beg to move, In page 2, line 42, after "person", to insert `not being a stock broker or his representative". Sir, the purpose of this amendment is to make it clear that "stock brokers" and "stock brokers' representatives", that is to say, remisiers, do not fall within the definition of "exempt dealer". A stock broker is a dealer and a remisier is a dealer's representative for the purpose of this Bill. Amendment agreed to.”