SGX plans rules on mainboard issue managers

New rules are on the cards that will hold issue managers more accountable for the companies they help to list on the Singapore Exchange (SGX) mainboard.

The SGX currently does not require mainboard issue managers to be independent from the firms they advise. These managers can have banking relationships with their clients and an interest in their equity securities.

But the SGX noted yesterday that "such involvement could present potential conflicts".

This is because the issue manager is responsible for providing "impartial advice to the listing applicant, discharge its obligations and be satisfied that the listing applicant meets the relevant admission requirements and is suitable to be listed".

The SGX wants mainboard issue managers to be independent of listing applicants and to be held to higher standards of due diligence.

Catalist listing rules already set out procedures and practices on the independence of sponsors from the issuers.

Public feedback is being sought for this proposal and other rule changes, including one to clarify that an issuer's directors and executive officers are responsible for ensuring that information submitted to the SGX during an initial public offering or reverse takeover is complete, accurate and not misleading.

If implemented, the rule changes will take effect in the first quarter of next year.

The public consultation is open until Dec 28.

A version of this article appeared in the print edition of The Straits Times on November 30, 2018, with the headline 'SGX plans rules on mainboard issue managers'. Print Edition | Subscribe