Debated in Parliament on 12 Nov 2024.
Assoc Prof Jamus Jerome Lim asked the Prime Minister and Minister for Finance (a) whether the Government will consider establishing an independent securities regulator instead of having Singapore Exchange Regulation (SGX RegCo) that undertakes all frontline regulatory functions and is a wholly-owned subsidiary of SGX; and (b) if not, why.
Singapore's capital markets operate under a dual-level regulatory framework. The Monetary Authority of Singapore (MAS), as the statutory regulator, has the broad mandate of overseeing the proper functioning of financial markets, including exchanges, like the Singapore Exchange Ltd (SGX). The Singapore Exchange Regulation Pte Ltd (SGX RegCo), a separate subsidiary of SGX, undertakes frontline regulatory functions of SGX as a self-regulatory organisation (SRO) to maintain fair, orderly and transparent markets. These functions include listing approvals, market surveillance and supervision of members.
The advantage of an SRO is that it can be more responsive to market conditions, while independent governance can be put in place to address conflicts of interest. SGX RegCo has an independent Chairman and a majority of directors who are independent.
There is a spectrum of regulatory arrangements globally and there is no one arrangement that is held out to be most appropriate for all jurisdictions.
The Equity Markets Review Group1 set up in August this year has been looking into measures to strengthen equities market development in Singapore and will include a review of our regulatory framework in this regard. It is engaging market participants for their feedback.
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