Regulator and money authority propose changes to public disclosure and IPO process for Singapore Exchange

The Singapore Exchange Regulation (SGX RegCo) is currently seeking feedback on changes proposed in a consultation paper that would eliminate the watchlist of loss-making mainboard companies and replace publicly querying issuers on unusual trading activities in favour of private engagements instead, in an effort to address concerns that public disclosure without reference to materiality can potentially alarm investors unnecessarily. Other market surveillance by SGX RegCo will go unchanged, according to the regulator.

In tandem, the Monetary Authority of Singapore (MAS) has proposed to streamline the initial public offering (IPO) process by simplifying prospectus disclosures for primary listings by focusing on core information relevant to investors. MAS has also suggested allowing issuers to gauge investor interest during the early stages of the IPO process to support bookbuilding and investor familiarity.

Under MAS’ proposal, issuers who already have primary listings elsewhere can use the same prospectus with minimal changes.

Mark Tan, an expert in corporate and commercial law at Pinsent Masons, said:  “The initiatives aim to revitalise Singapore's equity market following a decline in listings and trading activity.”

“By easing certain regulatory constraints, the reforms seeks to attract issuers and investors,” he said.

“Companies and advisors should consider taking steps to reassess their listing and compliance strategies, with a view to pivoting accordingly once the proposed changes have been implemented.”

MAS noted that the proposals aim to streamline listings and create broader options for reaching potential investors. Consultations on both SGX RegCo and MAS’s proposals are open until 14 June.

Mayumi Soh, an expert in corporate and commercial law at Pinsent Masons, said: “While the proposed changes foster a more conducive climate for potential issuers, investors may face increased difficulty if they are ill-equipped to detect investment risks in a less transparent environment. To reduce information asymmetry, it would be prudent enhance investor literacy.”