MOF and ACRA consult on proposed legislative amendments relating to digital communications and regulatory enhancements

13 March 2024

The Ministry of Finance (“MOF”) and the Accounting and Corporate Regulatory Authority (“ACRA”) are inviting feedback on proposed amendments to the Accounting and Corporate Regulatory Authority Act 2004 (“ACRA Act”) and the Companies Act 1967 (“CA”) in their draft ACRA (Registry and Regulatory Enhancements) Bill (“draft Bill”) aimed at streamlining Singapore’s corporate regulatory regime.

Proposed amendments

The draft Bill will introduce the following key changes:

  • facilitate digital communications with businesses and other stakeholders;
  • improve filing convenience and the data accuracy of ACRA’s registers;
  • enhance the accuracy of the registers of directors;
  • streamline financial reporting requirements for foreign companies; and
  • introduce a tiered framework for the disclosure of data.

The draft Bill is in Annex A. The document explaining the key clauses in the draft Bill is in Annex B.

Timing

The consultation closes on 18 March 2024. MOF and ACRA will publish a summary of the main comments received.

Background 

ACRA sought feedback in consultation papers published on 20 July 2020 and 17 July 2021. On 4 March 2024, ACRA published its responses to key feedback received on the proposals (“ACRA Response”). The draft Bill released for consultation on 5 March 2024 sets out the proposed legislative amendments for most of the issues covered in the ACRA Response.

Facilitating digital communications with businesses and other stakeholders

Digital mailbox

Currently, under the CA, documents and information sent by the Registrar to companies, officers, shareholders, and members are sent via hard copy. In a move towards greater digitalisation, clauses 8 and 9 of the draft Bill amend the ACRA Act so that the Registrar may:

  • notify the recipient via electronic means on how and when to access documents and information sent by the Registrar; and
  • send documents and information (other than summonses) by way of posting on the digital mailbox in BizFile+.

Access to this system will be restricted to authorised individuals using Singpass or Corppass, ensuring the security and privacy of the content of these documents and information.

Any summons sent by the Registrar will continue to be sent via hard copy to the registered address of the entity or the residential address of the individual.

Collection of information

Currently, ACRA collects contact details such as businesses’ registered office address and position holders’ (e.g. directors and company secretaries) residential address (and alternate address, if opted for).

To facilitate Government-to-business digital communications, clauses 6(d) and 7 of the draft Bill enable the Registrar to require and collect any information for any purpose of the ACRA Act or an ACRA-administered Act in addition to information relevant to the transaction, by way of the form in BizFile+. Such information includes email addresses and mobile numbers.

Improving filing convenience and data accuracy of ACRA’s registers

Obtaining and using information from specified government agencies

Currently, ACRA has the power to rectify or update particulars or documents kept in its registers under limited circumstances, such as when the Registrar is satisfied that there is evidence of a conflict between the particulars of an entity or person and (i) other information in the register, or (ii) other information from a prescribed body. There is, however, no provision that allows drawing of data at the stage of filing, before the data is in ACRA’s registers or records.

Clause 10 of the draft Bill will empower the Registrar to obtain and use information from specified government agencies, such that:

  • the person will not need to input the data with ACRA during the filing of a transaction and the data will be deemed to be filed by the person; and
  • ACRA may use the information to maintain, rectify, or update ACRA’s registers (e.g. changes in particulars of a director such as full name, residential address, and nationality).

This will lead to greater convenience to persons and entities by reducing the number of times they are required to provide data to government agencies.

Obtaining and using information from specified entities

Currently, there is no power to rely on information from body corporates for the purposes of enforcement or regulatory functions.

To improve the accuracy of data in ACRA’s registers and enhance ACRA’s enforcement and regulatory function, clause 10 of the draft Bill will enable the Registrar to obtain any information from a specified entity for the purpose of verifying the accuracy of any document or information in ACRA’s repository.

Clause 10 of the draft Bill will also enable the Registrar to perform enforcement or regulatory functions based on the information obtained from specified entities, and empower the Minister to specify the non-government entities that the Registrar may obtain information from.

Enhancing accuracy of registers of directors

Currently, the CA does not expressly allow the Registrar to update the register of directors to reflect the disqualification status of directors disqualified under the CA based on information it receives from government agencies, including the courts.

Clause 13 of the draft Bill will make it clear that the Registrar is empowered to:

  • reflect the disqualification status of individuals disqualified under any section of the CA; and
  • use information obtained from any public agency or government body (including the courts) for the purpose of exercising the power to reflect the disqualification status of individuals disqualified under any section of the CA in ACRA’s register.

Streamlining financial reporting requirements for foreign companies

Clause 14 of the draft Bill introduces changes to streamline the financial reporting requirements for foreign companies.

For a foreign company that is listed in Singapore or overseas, the foreign company will have to lodge the financial statements prepared in compliance with the applicable listing rules of the exchange on which the foreign company is listed.

For a foreign company that is not listed:

  • If the foreign company prepares financial statements in accordance with accounting standards that are substantially similar to the Accounting Standards, these financial statements can be used for lodgement with the Registrar.
  • If the foreign company does not prepare financial statements in accordance with accounting standards that are substantially similar to the Accounting Standards, but prepares financial statements in accordance with the applicable accounting standards in the foreign company’s jurisdiction of incorporation, these financial statements can be used for lodgement with the Registrar. The extent of audit should also follow the laws of the foreign company’s country of incorporation.
  • In other cases, the unaudited summary financial statements can be lodged with the Registrar.

Tiered framework for disclosure of data

One of the functions of ACRA is to establish and administer a repository of documents and information relating to business entities and public accountants, and to provide public access to such documents and information.

Clause 10 of the draft Bill will:

  • empower the Minister to make a tiered framework to calibrate the disclosure of data that is filed or collected by the Registrar to different persons or classes or people; and
  • empower the Registrar to disclose data in accordance with the tiered framework.

In the ACRA Response, ACRA said that in working out the details of the tiered framework, it will take into consideration the need to take a differentiated approach for different purposes, such as fulfilling anti-money laundering-related statutory obligations.

Other matters

In the ACRA Response, ACRA also provided an update on the following proposals which are not included in the draft Bill.

Masking of identification numbers and introduction of “contact address” as default address

ACRA had proposed to partially mask the identification number of all individuals in ACRA’s registers which are made available to the public and introduce a “contact address” as the default address of individuals that will be shown to the public, instead of the individual’s residential address.

In the ACRA Response, ACRA said that it will proceed with the proposal to introduce a “contact address” as the default address of individuals that will be shown to the public. On the proposal to mask identification numbers, ACRA noted the concerns on requiring access to full identification numbers for purposes such as corporate transparency and compliance with know-your-client requirements. ACRA will review this further and provide an update in due course.

Standardisation of personal data

ACRA will proceed with its proposal to standardise the references to the “name” of individuals in ACRA-administered legislation such that “full name” or “name” of an individual means the name of an individual as stated in the identity card or equivalent identification document.

Class exemption order under section 202(2) of the CA

ACRA had proposed to make a class exemption order under section 202(2) of the CA to relieve all public non-listed companies and private companies from disclosing directors’ interests in shares in, or debentures of, the company and other body corporates, where all shareholders give consent for the non-disclosure, and such consents are to be filed with ACRA.

In the ACRA Response, ACRA said that it recognised that obtaining consent in writing from all shareholders may result in administrative burden to companies with many shareholders. Hence, ACRA will modify the proposal such that a company may avail itself of the exemption if the company declares, as part of its annual return filing, that all its shareholders have consented to the non-disclosure of directors’ interest in shares in, or debentures of, the company and other body corporates (i.e. the proposed additional requirement for the consents to be filed with ACRA will not be proceeded with).

Reference materials

The following materials are available on the MOF website www.mof.gov.sg and the ACRA website www.acra.gov.sg:

Consultation paper (5 March 2024)

ACRA Response (4 March 2024)