Will George Goh qualify to run for President? It's a matter of discretion, say lawyers

SINGAPORE: How might businessman George Goh still qualify to run for President in Singapore, if he does not meet the requirement of having been chief executive of a company with at least S$500 million in shareholders' equity?

Constitutional lawyers say that it will likely come down to the discretion of the Presidential Elections Committee (PEC), as it is unclear whether Mr Goh will automatically qualify as a candidate.

Questions over Mr Goh's eligibility have emerged since the serial entrepreneur, who brought Harvey Norman to Asia, announced on Monday (Jun 12) that he intends to stand for election.

Mr Goh was the second person to put himself in the potential running, after Senior Minister Tharman Shanmugaratnam.

Speaking to reporters on Tuesday, Mr Goh said he was confident of meeting the criteria, and that he had put together a team of professionals to help determine his eligibility.

On Thursday, Mr Goh's media team issued a statement reiterating that this team of professionals, which includes lawyers, was gauging his qualifications.

Mr Goh "has been advised that the stable of companies which he manages, taken together, would enable him to qualify under Article 19(4)(b)" of the Constitution, his media team said.

Article 19(4)(b) encompasses what is known as the "deliberative track" of the private sector service requirement to run for President.

Mr Goh's media team added that he was "mindful that it is up to the PEC to decide his eligibility and he will not publicly disclose further details of his case beyond the comments above".

The 63-year-old is the group executive chairman of Ossia International, a Singapore Exchange (SGX)-listed investment holding company with a market capitalisation of about S$45 million (US$33 million) as of Wednesday.

His website states that he has "owned seven listed companies across Singapore, UK and Australia with a collective market capitalisation of S$3.15 billion".

According to a company announcement filed with SGX, Ossia International had S$54.9 million in shareholders' equity – or net assets – in the financial year 2022/2023.

The shareholders' equity was S$48.6 million in FY2021/22 and S$45.1 million in FY2020/21, according to annual reports published on Ossia International's website.

RELYING ON THE "DELIBERATIVE" TRACK?

To meet the private sector service requirement to be President, an applicant must have served as the chief executive of a company for at least three years. During this time, the company must, on average, have shareholders' equity of at least S$500 million and made profit after tax for the entire time.

Until the PEC decides, there will be uncertainty as to whether Mr Goh will be on the ballot, said Associate Professor Eugene Tan of the Singapore Management University Yong Pung How School of Law.

From Mr Goh's press statement and remarks to media on his candidacy, it appears that he does not automatically qualify to stand for election under the private sector service requirement, said Assoc Prof Tan.

"He probably is going to rely on the private sector deliberative track to secure eligibility," he told CNA.

Under this track, the PEC will consider whether the nature of the office, the size and complexity of the organisation and the applicant's performance in that office is "comparable" to the experience and ability of a chief executive of a typical company with shareholders' equity of at least S$500 million.

The PEC may also consider any other factors it sees fit, as to whether an applicant has the experience and ability to effectively carry out the President's functions and duties.

"In other words, if he qualifies automatically and is a person of integrity, good character and reputation, the PEC is duty bound to issue him a certificate of eligibility," said Assoc Prof Tan.

"But on the deliberative track, he is requesting the PEC to exercise discretion and grant him a (certificate of eligibility), which will hinge (on) whether the PEC is satisfied in the manner as described above."

S$500 MILLION: A "HARD RULE?"

Mr Ben Chester Cheong, a law lecturer at the Singapore University of Social Sciences, similarly said it was "not immediately clear" whether Mr Goh meets the shareholders' equity requirement.

He pointed out that in the past three financial years, Ossia International made profit after tax, but its total shareholders' equity was below S$500 million.

Mr Cheong said that based on his understanding, the S$500 million shareholders' equity is a "hard rule" that applicants must still meet - even under the deliberative track.

He added that it was also not clear which company Mr Goh was relying on to meet the shareholders' equity requirement.

According to Mr Goh's website, he is concurrently also the founder and director of Harvey Norman Ossia, and founder and group chairman of ITG International, which has a property development business.

He was previously the chairman of international operations at sporting company Rebel Sport, founder and director of VGO Corporation (known for the World of Sports stores), founder and director of water treatment solutions provider United Envirotech and founder and chairman of property fund manager SGL Capital Investment Managament.

The Constitution is "quite clear" that the presidential election applicant needs to be a person who is the most senior executive, "however named in that entity and who is principally responsible for the management and conduct of the entity's business and operations", said Mr Cheong.

"One would assume holding a co-founder role or majority shareholder alone is insufficient if it's not in a senior executive capacity that is equivalent to CEO," he added.

Mr Cheong also said that allowing an applicant to aggregate a portfolio of companies at different points in time, to reach S$500 million in shareholders' equity, would defeat the purpose of the legislative amendment that brought about this requirement.

The private sector service requirement was raised from S$100 million paid-up capital to S$500 million shareholders' equity in 2016.

"The updated quantitative threshold of S$500 million reflects the vastly different economic climate today, compared to 25 years ago," then Deputy Prime Minister Teo Chee Hean told Parliament at the time.

Assistant Professor Benjamin Joshua Ong, also of the SMU Yong Pung How School of Law, said that based on his reading of the Constitution, "one cannot add up multiple companies' shareholders' equity to make up the S$500 million".

"Even if you don't meet the requirement of S$500 million shareholders' equity for one company, the PEC can, in its discretion, take the view that you have had a 'comparable' level of 'experience and ability' to someone who has been chief executive of one company with shareholders' equity of S$500 million or above," he said, concurring with Assoc Prof Tan.

Asst Prof Ong said this was a matter for the PEC's discretion - and according to the Constitution, the PEC's decision in this regard "is final and is not subject to appeal or review in any court".