Legal Highlights (13 March 2017 – 17 March2017)
Landmark ruling on SIA The Federal Court in a landmark case has ruled that principal officers and directors are liable if the companies they represent provide misleading information. It was held that such liability, which is based on section 122(1) of the Securities Industry Act 1983 (SIA), does not violate the Federal Constitution. The ruling was based on the charges made by the Securities Commission against Transmile Group Bhd’s (Transmile) former chief executive officer Gan Boon Aun for abetting Transmile in making a statement that was misleading in a material particular relating to Transmile’s revenue, which was likely to induce the purchase of its shares.
UK: Brexit Bill passed The United Kingdom (UK) House of Lords (“the House”) by 274 to 118 votes, has passed the unamended European Union (Notification of Withdrawal) Bill 2016-17 (“the Bill”) which is expected to receive Royal Assent and become law in March 2017. The House also agreed not to include the guarantees over the status of European Union (EU) residents in the UK in the Bill. The passage of the Bill is significant as the UK government may now invoke Article 50 of the Lisbon Treaty to leave EU. The Supreme Court previously ruled that Article 50 cannot be triggered without an act of Parliament authorising the Government to do so.
Singapore: Amendments to Companies Act passed The Singaporean Parliament passed the Companies (Amendment) Bill was passed and will come into effect on 31 March 2017. The amendments aim to make the ownership and control of business entities more transparent and thus prevent the misuse of corporate entities for illicit purposes. Under the amendments, locally incorporated companies and foreign companies registered in Singapore will be required to maintain registers of controllers at prescribed places, among others. A controller or beneficial owner is the individual or legal entity which has more than 25 per cent interest in or control over a company.
New Zealand: Stricter anti-money-laundering rules The Anti-Money Laundering and Countering Financing of Terrorism Amendment Bill (“the Bill”) was tabled in the Parliament on 13 March 2017. The Bill requires companies to implement systems to guard against money laundering and to carry out due diligence on customers. Further, the Bill also extends the anti-money-laundering obligations to lawyers, conveyancers, accountants, real estate agents, sports and betting industry, and businesses that deal with high value goods.
UK: Provisions for animal charities reinstated The United Kingdom Supreme Court in Ilott v The Blue Cross and Ors has overturned the decision (“the Decision”) of a Court of Appeal which ruled in favour of Illot, a woman who was excluded from her mother’s will of GBP500,000 that was given to three animal charities. It was held that the Court of Appeal erred when calculating the reasonable financial provision and allowed the appeal by the charities against the Decision.