SINGAPORE - Listed companies will soon be able to use electronic communication to transmit annual reports and other documents to shareholders.
The Singapore Exchange (SGX) had held a public consultation on the issue and found that a majority of respondents supported the move to give companies more flexibility over how best to communicate with their shareholders.
When the constitution of the company specifies that the "deemed consent" regime is in use and the company has given the shareholder the opportunity to choose within a specified period whether to receive electronic or physical copies, a shareholder who fails to make an election would be deemed to have consented to receive electronic copies.
"Implied consent" is obtained when the constitution provides for the use of e-communication and states that the shareholder shall agree to such a mode of communication without the right to elect to receive physical copies.
Where the shareholder does elect to receive electronic copies, or where express consent is given when both the company and the shareholder agree in writing that e-communication will be used, the company may send all documents, including notices, circulars and annual reports via e-communication.
For other shareholders who have given either deemed and implied consent, hard copies of documents which allow shareholders to preserve or exercise their voting rights such as notices of meetings, forms and acceptance letters, must still be sent out.
Shareholders can also expect letters notifying them of documents uploaded onto the company's website and procedures on how to request hard copies of documents.
Physical copies of notices and documents relating to take-overs and rights issues must also be provided, as required by the Companies Act.
In addition, SGX also issued responses to feedback on proposals regarding insurance coverage and indemnities for directors, restraint on exercise of voting rights, and the treatment of shares held by a subsidiary in its holding company.
"These changes to the Listing Rules will enable companies to increase the use of e-communication to a level best suited to their shareholders. We recognise that shareholders at the early stage, should still receive physical copies of certain key documents and this has been provided for. E-communication is timelier, more efficient and less costly so shareholders will benefit in the long run," said Mr Tan Boon Gin, the chief regulatory officer of the SGX.
SGX will amend the Listing Rules pertaining to e-communication of shareholder documents and other aspects from March 31.