Singapore Studying Rules for Net-Launched IPOs
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The Singapore government has announced that it plans to allow companies to launch IPOs on the Internet.
The move is seen as one more push in strengthening the city's position as a regional financial center. Speaking to listed companies Wednesday, Minister of State for Trade & Industry and Communications & IT Lim Swee Say said the government is now working out guidelines that will allow companies to raise funds through the Internet. The rules will also allow investors to get adequate information through the Net, he said.
He said the Ministry of Finance, together with the Registry of Companies and Businesses and the Monetary Authority of Singapore are "now coming up with a framework of guiding principles, for issuers wishing to raise corporate finance on the Internet."
The purpose of these guidelines is to focus on ensuring that IPOs via the Internet are accompanied by adequate and reliable information for investment decisions, without constraining the issuers' ingenuity in making the process cheaper, faster and more convenient for investors.
"The rise of electronic trading and increasing breadth of online financial services also poses challenges for the regulators. In Singapore, we kept up with developments by establishing rules in Internet trading of shares and unit trusts (mutual funds). As we continue to promote the measured and orderly growth of e-finance and e-commerce, the next step for us is to facilitate online IPOs," he said.
Currently, almost all of the 30-plus stock brokerages in Singapore are opened for Internet trading. The big four banks -- The Development Bank of Singapore, Overseas-Chinese Banking Corp, United Overseas Bank and Overseas Union Bank -- are preparing to launch online trading services.
"Although the percentage of trades done online is still very small, analysts have forecast that the proportion could eventually reach as high as 30 percent. At the same time, we are seeing a broadening of the services offered online," said Lim.