Singapore Exchange Regulation (SGX RegCo) Proposes Regulatory Changes Towards Disclosure-Based Regime to Strengthen Investor Confidence & Follow-Through Recommendations by Singapore Equities Market Review Group, 1) Robust Disclosures Rather than Prescribing What Companies Should Do, 2) Focus on Materiality of Information Needed to be Disclosed in Timely & Accurate Manner for Market to Evaluate Standards of Corporate Governance & Disclosure, 3) Address Concerns of Regulatory Friction Impeding Price Discovery & Market Efficiency, 4) Maintain Focus on Admission of Quality Issuers, Robust Trade & Corporate Surveillance, Proposed Reforms Include 1) Streamline & Refine Qualitative Mainboard Admission Criteria, 2) Remove Financial Watch-List, 3) Post-Listing Queries & Obligations, 4) Enable Shareholder-Requisitioned Meetings
16th May 2025 | Hong Kong
The Singapore Exchange Regulation (SGX RegCo) is proposing regulatory changes towards a disclosure-based regime to strengthen investor confidence & follow-through the recommendations by Singapore equities market review group, 1) Robust disclosures rather than prescribing what companies should do, 2) Focus on materiality of information needed to be disclosed in timely & accurate manner for market to evaluate standards of corporate governance & disclosure, 3) Address concerns of regulatory friction impeding price discovery & market efficiency, 4) Maintain focus on admission of quality issuers, robust trade & corporate surveillance. The proposed reforms include 1) Streamline & refine qualitative mainboard admission criteria, 2) Remove financial watch-list, 3) Post-listing queries & obligations, 4) Enable shareholder-requisitioned meetings. Announcement (15/5/25): “In line with an approach that adopts a pro-enterprise stance alongside measures to strengthen investor confidence, Singapore Exchange Regulation (SGX RegCo) is proposing regulatory changes towards a more disclosure-based regime. This is one part of recommendations announced by the Equities Market Review Group (Review Group) in February 2025.” More info below:
“ Singapore Exchange Regulation (SGX RegCo) Proposes Regulatory Changes Towards Disclosure-Based Regime to Strengthen Investor Confidence & Follow-Through Recommendations by Singapore Equities Market Review Group, 1) Robust Disclosures Rather than Prescribing What Companies Should Do, 2) Focus on Materiality of Information Needed to be Disclosed in Timely & Accurate Manner for Market to Evaluate Standards of Corporate Governance & Disclosure, 3) Address Concerns of Regulatory Friction Impeding Price Discovery & Market Efficiency, 4) Maintain Focus on Admission of Quality Issuers, Robust Trade & Corporate Surveillance, Proposed Reforms Include 1) Streamline & Refine Qualitative Mainboard Admission Criteria, 2) Remove Financial Watch-List, 3) Post-Listing Queries & Obligations, 4) Enable Shareholder-Requisitioned Meetings “
Tan Boon Gin, CEO of SGX RegCo: “The proposed measures will shift us towards a more market-driven, disclosure-based regime. This will smoothen the path for enterprises to access the capital markets, allowing investors an expanded range of investing opportunities and better ability to make investment decisions in reliance on relevant and material information. The effectiveness of such a market-driven approach rests on a foundation of rules and standards that assure market participants that the information on which they base their decisions is accurate and accessible, and that the market is fair. This is the philosophy behind today’s consultation. To that end, we will ensure that regulatory oversight of both corporate disclosures and trading activity remains rigorous, even as we refine the manner in which such oversight is conducted and communicated, to ensure relevant and material information for investors is disclosed.”
SGX RegCo will:
- Move towards ensuring robust disclosures and away from prescribing what companies should do. This shift recognises the increasing diversity and complexity of the market and investors, and emphasises giving investors sufficient information to make their own decisions.
- Tighten the focus on the materiality of information that needs to be disclosed in a timely and accurate manner, so that the market can better discriminate in favour of companies with high standards of corporate governance and disclosure.
- Address concerns of regulatory friction that impedes price discovery and market efficiency. These adjustments will strike a more proportionate balance in facilitating market discipline and achieving investor protection.
- Maintain its focus on the admission of quality issuers and robust trade and corporate surveillance.
The intended changes will complement the other measures the Review Group announced to promote institutional participation, and foster an attractive and trusted market.
Areas in which SGX RegCo has proposed reforms for public consultation include:
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Streamlining qualitative Mainboard admission criteria – SGX RegCo intends to streamline the qualitative admission criteria for the Mainboard, while ensuring that listing applicants continue to be of high quality. SGX RegCo will maintain a prescriptive approach on the listing applicant’s financial position and its directors, management and controlling shareholders, which are critical areas. The focus for other matters will be on ensuring relevant and robust disclosures for investors to make well informed decisions, rather than prescribing how such matters must be resolved.
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Refining quantitative Mainboard admission criteria – SGX RegCo is also seeking views on potential calibrations to certain quantitative admission criteria, specifically, the profit test for Mainboard admission.
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Removal of the financial watch-list – SGX RegCo is seeking feedback on its intention to remove the financial watch-list[1] to address feedback from market participants on its unintended consequences on issuers, such as the negative impact on business confidence and difficulties in obtaining financing. Issuers must still make an announcement when they report losses for three consecutive years so investors are informed. Pending the outcome of the consultation, SGX RegCo will provisionally suspend the half-yearly reviews to place issuers on the watch-list. Issuers on the watch-list will remain listed during this time, regardless of their inability to exit the watch-list in accordance with the relevant criteria.
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Other post-listing queries and obligations – In addition to the proposed Listing Rule changes, SGX RegCo intends to adopt a more targeted approach in its administrationof post-listing queries and obligations to address market feedback that issuing queries, regardless of the materiality of the matter, may cause unnecessary alarm to the market. The more targeted approach aims to strike a better balance in facilitating market discipline and achieving investor protection.
The calibrated administration will include (a) shifting from publicly querying issuers to private engagement when unusual trading is detected; (b) focusing public disclosure requirements on information that is materially price-sensitive or trade-sensitive; (c) limiting the validity period of trade-with-caution alerts to an initial period of two weeks; and (d) refining its approach to the suspension of issuers.
SGX RegCo’s practices for other market surveillance activities will remain unchanged; this includes continuous monitoring of the market for unusual trading activity and, where necessary, taking actions to forestall market abuse. SGX RegCo will continue to decisively deploy the range of regulatory tools available and intervene when there are issues of serious trading irregularities and market manipulation. In addition, failure to comply with disclosure obligations may, as is currently the case, result in penalties under the Listing Rules and the Securities and Futures Act 2001. Where necessary, SGX RegCo will refer such cases to the Monetary Authority of Singapore and other relevant authorities for further enforcement action. The Review Group is also separately reviewing investor recourse avenues in instances of market misconduct.
- Enabling shareholder-requisitioned meetings – SGX RegCo had last year consulted on a proposal to require companies to assist shareholders requisitioning general meetings so that the meetings can take place as soon as practicable. SGX RegCo expects to announce its response to the consultation in the coming months. The related rule change will further empower shareholders, thereby strengthening market discipline.
This consultation is found here and will close on 14 June 2025.
Note 1 – SGX RegCo will place an issuer listed on the Mainboard on the financial watch-list if it records pre-tax losses for the 3 most recently completed consecutive financial years (based on audited full year consolidated accounts) and an average daily market capitalisation of less than S$40 million over the last 6 months.
Singapore Exchange Regulation (SGX RegCo) Proposes Regulatory Changes Towards Disclosure-Based Regime to Strengthen Investor Confidence & Follow-Through Recommendations by Singapore Equities Market Review Group, 1) Robust Disclosures Rather than Prescribing What Companies Should Do, 2) Focus on Materiality of Information Needed to be Disclosed in Timely & Accurate Manner for Market to Evaluate Standards of Corporate Governance & Disclosure, 3) Address Concerns of Regulatory Friction Impeding Price Discovery & Market Efficiency, 4) Maintain Focus on Admission of Quality Issuers, Robust Trade & Corporate Surveillance, Proposed Reforms Include 1) Streamline & Refine Qualitative Mainboard Admission Criteria, 2) Remove Financial Watch-List, 3) Post-Listing Queries & Obligations, 4) Enable Shareholder-Requisitioned Meetings
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