34. Alteration of constitution by company pursuant to repeal and re-enactment of sections 10 and 14 of Residential Property Act Flashcards
- Alteration of constitution by company pursuant to repeal and re-enactment of sections 10 and 14 of Residential Property Act
General overview
[34.01] This new s 34 provides that where a company was formed for the purpose of acquiring residential property in Singapore, and its constitution contains a provision to that effect, the company may pass a special resolution to remove that clause. The company will then become an ordinary company governed by the Act. Subsection (2) further provides that where such a company makes provision in its constitution that its status as a “Singapore company” under the Residential Property Act (Cap 274) shall not be altered, such a provision may be removed by a special resolution. A company that was formed for the purpose of acquiring residential property pursuant to the Residential Property Act (Cap 274), has the status of a “Singapore company” which is defined as follows:
(a) the company is incorporated in Singapore and its directors and members are all citizens;
(b) if any member of the company is another company, that other company satisfies the requirements of paragraph (a);
(c) if that other company referred to in paragraph (b) has a member which is a company, which in turn has a member which is also a company and so on, all the members of each such company consist only of any or any combination of the following:
(i) citizens; and
(ii) companies that satisfy the requirements of paragraphs (a) and (b); and
(d) if any member of the company is a limited liability partnership, that limited liability partnership is a Singapore limited liability partnership.
[34.02] Such a company may, by special resolution, amend its constitution to remove the provision empowering it to acquire residential property. Furthermore, any entrenching provision of such a provision enabling the acquisition of residential property, shall cease to have any effect as at March 31, 2006, and the company may by special resolution remove the entrenching provision: s 34(2). In other words, this section allows “Singapore companies” to convert to an ordinary company by removal of the relevant provision.
