Gan Kim Yong on Significant Investments Review Bill

Singapore is an open economy, which has allowed it to become a vibrant business hub and an attractive investment destination. At the same time, it can be vulnerable to actors that may seek to undermine its national security interests through ownership and control of critical business entities. A Bill was put up for debate in Parliament on Tuesday (Jan 9), proposing an updated toolkit for Singapore to manage threats posed by significant investments into its critical entities. Trade and Industry Minister Gan Kim Yong emphasised that the legislation was intentionally calibrated to protect Singapore’s national security interests while minimising the impact on affected stakeholders, so that the country’s corporate landscape will remain vibrant and attractive to bona fide investors. For example, as the majority of critical entities are already covered by existing sectoral legislation, the minister can designate a specific entity based on national security considerations - and expects to do so for “only a handful” of entities. This will reduce the regulatory burden of the Bill. Mr Gan outlined the details of how the minister will be able to exercise oversight of the ownership, or control changes involving parties in positions to influence and direct actions of designated entities, and issue remedial directions under various circumstances. There are also measures to ensure the continued performance of critical functions of the entities. Another set of provisions involves powers that can be exercised against any entity that has acted against Singapore’s national security interests, regardless of whether it is designated or not. Measures in the Bill can be taken against any individual regardless of citizenship or residency status, and against any entity regardless of type or domicile location. Penalties, which Mr Gan said need to form an effective deterrent, are also spelt out, along with the range of enforcement powers that authorised officers can exercise.