Nine companies identified as critical entities under Significant Investments Review Act

Nine companies identified as critical entities under Significant Investments Review Act

SINGAPORE: Nine firms, including three in the oil sector and four under ST Engineering, have been designated as vital institutions under a new rules aimed at managing risks posed by substantial investments.

The Significant Investments Review Act ( SIRA ), which&nbsp, came into force in March, &nbsp, scrutinises such investments, whether local or foreign, into entities that are critical to Singapore’s national security interests. &nbsp,

Published in the Government Gazette on Friday ( May 31 ), the list comprises: &nbsp, ST Logistics, Sembcorp Specialised Construction, ST Engineering Marine, ST Engineering Land Systems, ST Engineering Defence Aviation Services, ST Engineering Digital Systems, ExxonMobil Asia Pacific, Shell Singapore and Singapore Refining Company.

The new law” will strengthen Singapore’s position as a trusted and reliable business&nbsp, hub where investors can continue to invest with confidence”, said the Ministry of Trade and Industry ( MTI ) in a press release on Friday.

Singapore used sector-specific laws, such as those that restrict foreign ownership and licensing agreements, to control entities in controlled sectors like banking, telecommunications, and utilities.

SIRA adds a new purchase management framework to these already present regional protection by introducing a new program for specific entities identified as being crucial to national security, according to Trade and Industry Minister Gan Kim Yong in January when he presented the Bill for next reading.

According to Mr. Gan, the need for an updated regulatory toolkit comes as the world is becoming more complex and the economic environment is uncertain, citing the recent outbreak of numerous global financial crises and the COVID- 19 pandemic that caused border restrictions and supply shortages.

The new law applies to organizations that are deemed crucial and are not yet covered by existing laws, and are chosen based on whether they fulfill a crucial role in the country’s national security objectives, such as being a key provider of security-related functions where there are few or none of the alternatives.

Entities that are designated will be required to notify or request approval from the authorities before changes in ownership or control. Any transactions that take place without the necessary approvals will be void.

Within seven days of becoming a 5 % controller of an entity, buyers will be required to notify the Minister for Trade and Industry. Approval is needed for other controlling thresholds – 12 per cent, 25 per cent and 50 per cent – and acquisitions.

Sellers are also required to request approval when they cease to be a 50 % or 75 % controller.

Additionally, the entities will have to seek approval for the appointment of key positions, such as CEO and director posts. If these officers were appointed without prior notice or if the approval requirements were violated, they may be fired.

Additionally, these organizations are unable to be voluntarily liquidated or disband without the minister’s approval in order to maintain the security and dependability of their functions. If national security concerns arise or the provision of essential services is hampered, the government can intervene.