aldray wrote:Hi,
I was looking at the announcement made in novo group, in this pdf
http://www.novogroupltd.com/announcemen ... 403770.pdf. The company is listed in both Hong Kong and Singapore.
I don't really understand what this statement mean, any idea?
Code: Select all
The Company was incorporated in Singapore. Pursuant to the Singapore Companies (Amendments)
Act 2005, companies incorporated in Singapore no longer have an authorised share capital and there is
no concept of par value in respect of the issued shares.
the pdf file linke you provided just says there is NO movement of shares, that's all.
Par Value is an outdated concept and has been removed in Singapore since year 2005.
It basically set the maximum liability of the shareholders. Basically, it can be done without as liability of shareholders of Private Limited company is just limited to the Paid Up Capital of the company.
The Par Value of Shares: An Irrelevant Concept in Modern Company Law
Singapore Journal of Legal pp. 552-572, 1999
Abstract:
The par value regime has always been accepted as one of the cornerstones of our company law. The functions of the par value of shares are to fix the maximum liability of a shareholder and to protect the creditors of a company. However, the regime also entails many shortcomings, which have prompted many law commissions to suggest for its abolishment. Australia is the latest country that has done away with the par value regime. This article reviews the problems posed by the par value regime and evaluates the alternative regime.
Highlights of recent amendments to Singapore Companies Act
The Companies (Amendment) Act 2005
Singapore Companies Amendment Act 2005 came into effect on 30 January 2006. The Companies Act (Cap 50) was amended to adopt several changes recommended in the final report of the Company Legislation and Regulatory Framework Committee (CLRFC’) that was published on 22 October 2002. The key amendments arising from the Amendment Act include:
The abolition of the concepts of ‘par value’ and ‘authorised capital’;
Reforming the capital maintenance regime, including:
The introduction of an alternative capital reduction process which does not require court sanction;
The liberalising of financial assistance restrictions (to allow financial assistance to be provided in additional circumstances);
The reform of the share buyback regime;and
The enabling of redemption of preference shares;
The introduction of the concept of treasury shares (new sections 76H to 76K allow a company to hold re-purchased shares in treasury instead of cancelling them); and
Liberalizing the amalgamation process for companies (new sections 215A to 215J allow amalgamation of companies, including holding companies and their subsidiaries, without a court order).
http://appiqs.acra.gov.sg/ops/data/news ... ers%29.pdf
Company’s Memorandum & Articles of Association
Q1: We would like to know:-
(a) Whether there is a need to change the Memorandum for those companies incorporated prior to 30/1/2006 by filing the deletion of the clause on the authorised capital;
(b) If there is no par value, take example a company prior to 30/1/2006 which has a issued paid up capital of $100,000/- divided into 1,000 ordinary shares of $100/- each fully paid.
Can we take it that after the abolishment of the par value, ACRA will automatically update this company's paid up capital to $100,000/-. If so, does ACRA also update the individual member's shareholding, say previously Mr. A held 500 shares at $100/- each, Mr A's shareholding will automatically be updated to $50,000/- after 30/1/2006.
We appreciate your assistance on the abovementioned matters as most of our clients are more concern that they do not need to pay extra filing fees in regards to the amendments.
A1: Please refer to new section 22(1A) of the Companies Act which deems any reference in the memorandum of a company to authorised capital to be deleted.
On 30 Jan 2006, the share capital of the company will be reflected as the total of number of shares issued multiplied by the par value immediately before 30 Jan 2006 and this is referred to as “Issued Capital” in ACRA’s register (see PD 1 of 2006 dated 12 Jan 2006, paragraph 4.1). Companies that have received share premium and have capital redemption reserves may update the amounts in the
new form “Notification of Share Capital under Section 62B(7)” within 6 months from 30 Jan 2006.
The individual member’s shareholding will only reflect the number and class of the shares held by the member.