COMPANIES ACT (Review)

[Mr Speaker in the Chair]

Mr Sin Boon Ann asked the Minister for Finance whether the Government is planning to undertake in the near future a comprehensive review of the Companies Act and its related legislation.

The Minister for Finance (Dr Richard Hu Tsu Tau): Mr Speaker, Sir, the last round of amendments to the Companies Act was passed in November last year. The amendments involved, amongst other issues, the introduction of share buybacks, updating the law on the concept of "deemed interest"; extending the lifespan of employee stock options to 10 years; excluding trade franchises from the ambit of the Companies Act; and extending the life of unit trust prospectuses.

My Ministry is presently working with other agencies such as the Monetary Authority of Singapore (MAS), the Attorney-General's Chambers (AGC), the Stock Exchange of Singapore (SES), the academic community and private sector practitioners on the recommendations of the Corporate Finance Committee (CFC). A CFC Working Group has been formed which meets regularly to work through the CFC recommendations. There will be consequential changes to the Companies Act as a result.

As I mentioned in my reply to Mr Sin during the Budget debate earlier this year, I believe it is more prudent and practical to progress in stages to improve the Act and to introduce changes which are needed urgently, rather than try to do a comprehensive review all at once as this will take quite a long time. Otherwise, the total overhaul of the Act at this time will hold back other changes unnecessarily.