Statute Details
- Title: Significant Investments Review (Disregarded Equity Interests) Regulations 2025
- Act Code: SIRA2024-S676-2025
- Legislation Type: Subsidiary legislation (SL)
- Authorising Act: Significant Investments Review Act 2024
- Enacting Authority: Minister for Trade and Industry (pursuant to section 57(1) of the Significant Investments Review Act 2024)
- Regulation Citation: SL 676/2025
- Date Made: 13 October 2025
- Commencement: 16 October 2025
- Status: Current version as at 27 March 2026
- Key Provisions (Extract):
- Section 1: Citation and commencement
- Section 2: Disregarded equity interests for the purposes of section 14 of the Act
What Is This Legislation About?
The Significant Investments Review (Disregarded Equity Interests) Regulations 2025 (“the Regulations”) are subsidiary legislation made under the Significant Investments Review Act 2024 (“the Act”). In plain terms, the Regulations tell you that certain types of equity holdings will be “disregarded” when determining the position relevant to section 14 of the Act.
Singapore’s significant investments regime is designed to give the Government visibility and control over certain acquisitions and holdings of significant stakes in Singapore companies. The Act contains provisions that require review or approval in specified circumstances. However, not every equity interest held in a legal sense necessarily reflects the economic reality or the level of control that triggers regulatory concern. The Regulations address this by carving out specific categories of equity interests that should not count for the purposes of section 14.
Practically, the Regulations reduce compliance friction and prevent over-inclusive counting of equity interests where the holder does not, in substance, exercise the kind of influence or risk that the review framework targets. The Regulations focus on two main situations: (1) equity held by a bare trustee, and (2) equity held only as security by a person whose ordinary business includes lending money.
What Are the Key Provisions?
Section 1 (Citation and commencement) is straightforward. It provides the short title and states that the Regulations come into operation on 16 October 2025. For practitioners, this matters for determining which transactions and assessments fall to be considered under the Regulations’ definitions and exclusions from the commencement date.
Section 2 (Disregarded equity interests) is the core operative provision. It states that the following equity interests are disregarded for the purposes of section 14 of the Act:
(a) Equity interest held by a person as a bare trustee
Where a person holds an equity interest as a bare trustee, that equity interest is disregarded. A “bare trustee” typically refers to a trustee who holds legal title but has no active discretion and must act in accordance with the beneficial owner’s directions. The regulatory logic is that such a trustee does not represent an independent controlling interest; the beneficial owner is the relevant party. By disregarding the trustee’s holding, the Regulations aim to avoid double-counting and to align the review analysis with the party that actually has the economic entitlement and practical influence.
Key practitioner point: In structuring and documentation, it becomes important to identify whether the trustee is truly “bare” (i.e., lacking discretion) as opposed to holding interests with meaningful powers. The classification can affect whether the equity interest is counted for section 14 analysis. Lawyers should therefore examine the trust deed, trustee powers, and the nature of the trustee’s obligations to determine whether the “bare trustee” description is supportable.
(b) Equity interest held by a moneylender as security in the ordinary course
The Regulations also disregard an equity interest held by a person whose ordinary business includes the lending of money, provided that the person holds the equity interest only by way of security for a transaction entered into in the ordinary course of business in connection with the lending of money.
This exclusion is tailored to a common commercial scenario: a lender may take security over shares (or other equity interests) to secure repayment of a loan. In such cases, the lender’s holding is not intended to confer control over the company as an investment; it is collateral. The Regulations therefore prevent the lender’s security interest from being treated as a substantive equity holding that would trigger review concerns under section 14.
Key practitioner point: The exclusion is conditional. It requires that:
- the holder’s ordinary business includes lending of money;
- the equity interest is held only as security (not as an investment or for other purposes); and
- the security relates to a transaction entered into in the ordinary course of business connected with the lending of money.
Accordingly, lawyers should scrutinise loan documentation, security arrangements, and the lender’s business profile. Evidence that the equity is held exclusively as collateral—rather than as a strategic stake—will be central. Additionally, if the lender’s conduct goes beyond security (for example, taking steps that indicate an intention to exercise control), the “only by way of security” requirement may be challenged.
Interaction with section 14 of the Act
Although the extract does not reproduce section 14 of the Act, the Regulations’ language makes clear that the disregarded interests are relevant to the computation or assessment under section 14. In practice, section 14 likely determines whether certain equity holdings count towards a threshold or trigger point for review. The Regulations therefore operate as a definitional/computational rule: they tell you what not to count when applying section 14.
How Is This Legislation Structured?
The Regulations are concise and consist of:
- Section 1: Citation and commencement (administrative provision).
- Section 2: Disregarded equity interests (substantive provision).
There are no additional parts or schedules in the extract. The structure reflects the Regulations’ narrow purpose: to specify discrete categories of equity interests that should not be counted for section 14 of the Act.
Who Does This Legislation Apply To?
The Regulations apply to persons whose equity interests fall within the two disregarded categories when those interests are relevant to the application of section 14 of the Significant Investments Review Act 2024. This includes, in particular, trustees holding shares on trust and lenders holding shares as collateral.
From a transactional perspective, the Regulations are most likely to be relevant to:
- Trustees and trust administrators involved in holding equity interests for beneficiaries;
- Financial institutions and lenders that take equity as security for loans;
- Corporate parties and their advisers who must determine whether equity holdings count for review thresholds under the Act.
Practical scope note: The Regulations do not automatically exempt all trustees or all lenders. The exclusions are fact-specific. A trustee must be a “bare trustee,” and a lender must hold the equity “only by way of security” in the ordinary course of its lending business. Lawyers should therefore treat the Regulations as requiring careful factual and documentary analysis rather than assuming a blanket exemption.
Why Is This Legislation Important?
Although the Regulations are short, they can have significant consequences for compliance outcomes. In a significant investments review context, whether an equity interest is counted can determine whether a transaction is subject to review, whether approvals are required, and how ownership thresholds are calculated. By disregarding certain interests, the Regulations can materially affect the regulatory assessment.
First, the bare trustee exclusion helps ensure that regulatory counting focuses on the beneficial owner rather than on a legal title-holder who lacks discretion. This aligns the legal form of ownership with the substantive reality of control and economic interest. For practitioners, this reduces the risk of misclassification and over-reporting, but it also increases the importance of properly documenting the trust arrangement and the trustee’s lack of discretion.
Second, the security interest exclusion reflects commercial realities in lending markets. Without such a carve-out, lenders who take shares as collateral could inadvertently trigger review thresholds merely by virtue of holding security. The Regulations therefore support legitimate financing structures and collateral arrangements while preserving the review regime for genuine investment or control positions.
Finally, the conditional nature of both exclusions means that enforcement and scrutiny will likely focus on substance. Lawyers should anticipate that regulators or counterparties may ask for evidence that the trustee is indeed “bare” and that the lender holds the equity “only” as security and in the ordinary course of lending. Accordingly, the Regulations are important not only for legal interpretation but also for transaction structuring, due diligence, and drafting of security and trust documentation.
Related Legislation
- Significant Investments Review Act 2024 (authorising Act; relevant in particular to section 14 and section 57(1))
- Significant Investments Review Act 2024 – Timeline (for versioning and commencement context)
Source Documents
This article provides an overview of the Significant Investments Review (Disregarded Equity Interests) Regulations 2025 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.