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SGX allows dual class shares for secondary listings


Companies with dual-class share (DCS) structures that are primary listed in "developed markets" will be allowed to hold a secondary listing in Singapore, the Singapore Exchange (SGX) has said.

Under a DCS structure some shares are given higher voting rights than others. SGX ran a public consultation earlier this year asking whether this should be introduced, and what safeguards would be needed.

SGX's secondary listing framework splits companies into two groups based on their home exchanges.

For companies that are listed on any of the 22 markets that international index-providers FTSE and MSCI classify as developed markets, SGX will not impose additional post-listing conditions except a requirement that the companies make continuous disclosures via SGXNet of all announcements made to their home exchange.

These companies must also maintain their primary listing on the home exchange, which will maintain primary regulatory oversight.

Companies will still be reviewed to make sure they satisfy SGX criteria. Initial secondary listing applications from DCS companies will be referred to the independent Listings Advisory Committee, the exchange said.

Loh Boon Chye, chief executive of SGX said: "The secondary listing of companies, including DCS companies, in Singapore provides investors with more choice and enables these shares to be traded during the Asian time zone. Should a DCS company secondary-list on SGX, it could enhance overall market knowledge and familiarity with the risks and benefits of DCS companies."

Tan Boon Gin, chief executive of Singapore Exchange Regulation said: "While the existing secondary listing framework accommodates DCS companies, this does not presume that we will adopt a primary DCS listing framework. We are still evaluating the feedback received and target to update the market before the year-end."

The Monetary Authority of Singapore said in February that it would assess the effect of introducing DCS structures in SGX.

"DCS structures pose governance risks that need to be carefully assessed and managed. SGX will soon be conducting a public consultation on whether and how to introduce a listing framework for DCS structures in Singapore," it said.

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