EUPOC PULP AND PAPER INDUSTRIES LIMITED (Investigation into company's affairs)

Mr Yeo Choo Kok asked the Minister for Finance if he plans (1) to set up a fact-finding committee to look into the "Eupoc" affair; and (ii) to introduce new measures to ensure that public investment in industry is adequately protected in the future.

Mr Tang See Chim (for the Minister for Finance): Mr Speaker, Sir, a major shareholder of Eupoc Pulp and Paper Industries Ltd, has made a formal application under section 197 of the Companies Act for an investigation to he made into the affairs of the company. On the basis of the information supplied by this shareholder, the Minister for Finance was satisfied that a formal investigation was justified and has accordingly approved the shareholder's application.

The Government does not, however, propose to institute any investigations of its own into the affairs of the company.

Pending the findings of the investigation initiated by the shareholder, and in view of proceedings now before the courts, I do not propose to go into the circumstances under which the company has had to cease production.

I would like to assure the Member that there are adequate provisions in the Companies Act to deal with any malpractice on the part of a company's directors. These provisions will be strictly enforced. Also, in the case of listed companies, the Stock Exchange of Malaysia and Singapore has a responsibility for ensuring that directors do not suppress information which is of interest to shareholders.

The Member will appreciate that there will always be an element of risk associated with equity investment. Individual investors cannot escape responsibility for forming their own judgment as to the viability of a project and the quality of its management.