Singapore to streamline IPO reviews under exchange regulator

SINGAPORE: Singapore plans to streamline its listing process by consolidating prospectus and listing suitability reviews under SGX RegCo, an independent subsidiary of the Singapore Exchange, the Monetary Authority of Singapore (MAS) said on Wednesday (Oct 29).

Authorities are canvassing public opinion until Nov 29 on the proposal, which would mean prospective issuers only deal with SGX RegCo, rather than both MAS, Singapore's central bank, and the exchange regulator.

MAS will continue to oversee SGX RegCo and enforce prospectus disclosure rules under the Securities and Futures Act, it said in a statement.

The move is part of recommendations by the Equities Market Review Group, set up in 2024 to strengthen Singapore's equities market competitiveness through a more pro-enterprise, disclosure-based regime while maintaining investor safeguards.

Separately, SGX RegCo said in a statement it would lower the Mainboard profit test threshold for new listings to S$10 million (US$7.73 million) from S$30 million, in line with major exchanges.

"We are progressing with our initiatives to strengthen Singapore's position as a leading international capital markets hub," Tan Boon Gin, chief executive of SGX RegCo, said in the statement.

SGX RegCo will also refine admission criteria for pre-revenue companies, including life sciences firms, to broaden investor choice, it added.

Issuers must continue to provide robust disclosures, including material internal control weaknesses and conflicts of interest, it said.

The consolidation complements other efforts to streamline the listing process that had been consulted on earlier and also comes alongside measures that aim to strengthen investor confidence, MAS said.

SGX RegCo will remove its financial watchlist, citing unintended negative impact on business confidence, but companies with three consecutive years of losses must disclose this, it said.

The exchange regulator said that it will, where possible, engage privately with issuers on their disclosures to "avoid a chilling effect on the market". 

"However, issuers must continue to publicly disclose materially price-sensitive or trade-sensitive information. 

"If unusual trading is detected and there is reason to believe that the market is not fair, orderly or transparent, SGX RegCo will immediately issue trade-with-caution alerts."

Trading suspensions will only occur if there is clear evidence of going concern issues, SGX RegCo said. It will also consult on removing the Listings Advisory Committee process for listing applications.

MAS and SGX RegCo will maintain close coordination on surveillance and enforcement, according to both statements.