SG60: The development of Singapore’s corporate and securities law over the last 6 decades

Singapore's corporate law framework has undergone remarkable transformation over the past 60 years, evolving from a colonial-era system into a globally respected, business-friendly and sophisticated legal regime.

This evolution directly mirrors Singapore’s journey from a developing nation to a premier global financial hub. Here is a breakdown of the key developments.

Foundational period (1960s–1980s): Establishing sovereignty and basic frameworks

Prior to 1967, the Companies Ordinance 1940, which was modelled after the English Companies Act 1929, was the only corporate Act in force.

Thereafter, the Companies Act 1967, Singapore’s first major independent corporate statute, was enacted in 1967. While it was largely based on the Malaysian Companies Act (1965 edition), this began the process of localisation. The Companies Act 1967 was focused on basic incorporation, administration and creditor protection.

The Monetary Authority of Singapore (MAS) Act was passed in 1970, leading to the birth of the eponymous financial services regulator in 1971.

In 1973, the Securities Industry Act 1973 was established. This set the framework for regulating securities markets in Singapore. The same year, the Stock Exchange of Singapore was formed.

The key focus during this period was building foundational legal structures for a nascent economy, ensuring basic corporate governance and market regulation.

Modernisation and liberalisation (1980s–late 1990s): Embracing market economics and global standards

Against the backdrop of an economic recession in 1985, the enactment of the Companies (Amendment) Act 1987 facilitated tighter regulatory standards.

The Securities Industry Act 1973 was replaced by the Securities Industry Act 1986 and, later, the Securities and Futures Act 2001.

This created a more comprehensive and modern capital markets regulatory framework, aligning more closely with international standards such as those of the International Organization of Securities Commissions.

The Singapore Code on Take-overs and Mergers, first introduced in 1974, was refined in 1979 and again in 1985. Rudimentary corporate governance guidelines began to take shape.

In 1977, MAS played a predominant role in regulating the securities and futures industries, such as the insurance industry, alongside banking.

Towards the late 1990s, Singapore’s approach shifted to a disclosure-based regime, granting public companies greater liberty to tap the stock market. The focus was on making Singapore attractive to foreign investment and multinational corporations, fostering a dynamic capital market, and improving regulatory robustness.

Strategic review and enhancement (late 1990s–2010): Post-Asian financial crisis and competitiveness drive

December 1999 marked the appointment of the Company Legislation and Regulatory Framework Committee (CLRFC), which was pivotal to conducting a coherent and comprehensive review of Singapore’s corporate law and framework.

The recommendations of the CLRFC were implemented across major amendments of the Companies Act from 1999 to 2005. In 1999, the Companies Act criminalised any person who acted as a director or manager of a company while being an undischarged bankrupt.

Major amendments were made to the Companies Act in 2002, with key recommendations being the introduction of the limited partnership and limited liability partnership business structures, the simplification of incorporation and maintenance procedures for private companies, and the threshold for compulsory share acquisition.

More significant changes were made with the Companies (Amendment) Act 2004, and subsequently the Companies (Amendment) Act 2005.

Singapore’s corporate governance was further enhanced with the enactment of the statutory derivative action in 1993, which was a significant milestone for the protection of minority shareholders. Singapore progressed from a merit-based regime for public companies to a disclosure-based model in 1997.

The Companies Act began codifying the general management powers of directors, duties of disclosure of conflicts of interest, and duties not to misappropriate company assets and breach of directors’ fiduciary duties.

Following the Companies (Amendment) Act 2005, the Companies Act 2006 strengthened creditors’ protection by imposing restrictions on a company’s provision of financial assistance for the acquisition of its own shares. It also empowered creditors to declare that a person engaged in fraudulent trading was personally liable for the debt of the company.

In 2004, the Accounting and Corporate Regulatory Authority (Acra) was formed by merging the Registry of Companies and Businesses and the Public Accountants Board, creating a one-stop regulator for company registration and accounting standards. Greater administrative efficiency came with Acra’s launch of the BizFile+ portal, which streamlined filing requirements and processes for businesses.

The first Code of Corporate Governance that was formalised in 2001 and made applicable to all listed companies came into effect in 2003. The code was significantly revised in 2005 to strengthen the disclosure framework for directors.

The statutory and regulatory focus was in response to the Asian financial crisis. The development of Singapore’s corporate laws and regulations during this period emphasised enhancing transparency, accountability, and investors’ protection to boost international confidence and Singapore’s attractiveness as a financial and business hub.  

Comprehensive reform and global leadership (2010–present): Agility, innovation and sustainability

After extensive review and public consultation, the Companies Act 1967 was repealed and replaced with the landmark Companies Act (Chapter 50) 2006, which came into full effect with the Companies (Amendment) Act 2014 and Companies (Amendment) Regulations 2016.

The key changes included simpler criteria to be registered as a “small company” exempt from audit requirements and mandatory annual general meetings. New solvency tests were introduced for capital reductions and financial assistance to apply uniformly to all transactions, allowing more flexible options for mergers and amalgamations. Corporate governance was strengthened through more stringent disclosure requirements for nominee directors, refined director duties and shareholder remedies.

In 2020, the Variable Capital Companies Act 2018 took effect, creating a novel, flexible corporate structure specifically designed for investment funds. This boosted Singapore’s status as an asset management hub.

Sweeping revisions were made to the Corporate Governance Code in 2012 and 2018, emphasising board independence, diversity (including gender diversity), business sustainability, internal risk governance and remuneration-linked risk management, as well as stakeholder engagement beyond pure shareholder primacy.

The Covid-19 years also saw the modernisation of company communications through the embrace of virtual meeting technologies.

Singapore also made significant progress in environmental, social and governance areas. In 2021, Singapore Exchange Regulation (SGX RegCo) mandated sustainability reporting for listed companies in line with the recommendations of the Task Force on Climate-related Financial Disclosures. This enhanced the transparency of climate-related disclosures by listed companies in Singapore.

In 2022, MAS and SGX jointly launched ESGenome, a disclosure portal for listed companies to voluntarily make climate-related financial disclosures.

In 2024, MAS’ investigative and enforcement powers against corporate miscreants were expanded. Acra’s scope of such powers were also widened with the Corporate Service Providers Act 2024 and its regulations.

Greater enforcement powers accorded to SGX RegCo were introduced from August 2021, including its ability to issue public reprimand and compel listed companies to comply with its directives.

The BizFile+ portal was further revamped in 2024 to ensure seamless online corporate filings and transactions, streamlining digitalisation.

The Corporate Restructuring and Insolvency Regime implemented pre-packaged schemes of arrangements and adopted the United Nations Commission on International Trade Law’s Model Law on Cross-Border Insolvency.

Regulatory reforms were implemented to maintain Singapore’s competitiveness, foster innovation (particularly in areas such as fintech and asset management), promote sustainable and responsible business practices, enhance ease of conducting businesses – especially for small and medium-sized enterprises (SMEs) – and strengthen Singapore’s reputation as a trusted international dispute resolution centre.

The key drivers of these developments span various factors. The laws governing Singapore’s corporate regulatory regime were shaped to support the national economic goals of attracting foreign direct investment, developing financial services, and facilitating the growth of SMEs. Global best practices have also served as a reference point for Singapore when international regulatory standards are adopted.

The regulatory authorities have demonstrated continual stakeholder engagement by seeking extensive public and industry consultations prior to introducing and formalising reforms to the corporate regulatory regime in Singapore.

Through the various reforms, Singapore has also shown its willingness to adapt to various crises such as the Asian financial crisis by forming review committees such as the CLRFC.

The developments in Singapore’s corporate law landscape have been complemented by a robust dispute resolution system, offering multiple forms of internationally recognised dispute resolution processes.

Over the last six decades, Singapore’s corporate law has shifted from a basic compliance framework to a dynamic, sophisticated, and principles-based system.

It successfully balances competing priorities: robust investor protection and corporate governance with business-friendly efficiency and flexibility; adherence to global standards with responsiveness to local needs (especially SMEs); and traditional commercial law with emerging demands such as sustainability and digital innovation.

The continuous, strategic evolution of Singapore’s corporate law has been a cornerstone of the Republic’s economic success, as well as its reputation as a premier global business and financial centre. The focus now extends beyond pure efficiency and growth to encompass long-term sustainability and responsible stewardship.

In 2024, the government formed a review committee headed by a Cabinet minister to boost Singapore’s attractiveness as a venue for initial public offerings and secondary listings. The various proposals that have been announced by the review committee led to a perceptible increase of new listings from both foreign and local companies on the Singapore bourse in 2025.

The writer is partner at Kennedys and a director of Legal Solutions LLC

Source: The Business Times © SPH Media Limited. Permission required for reproduction.

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