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The Code of Corporate Governance ("Code") was recently revised by the Monetary Authority of Singapore ("MAS"). The revisions were made on the recommendation of the Corporate Governance Council, a committee set up by MAS to look into the review of the Code. Listed companies in Singapore are to comply with the principles and guidelines of the Code or explain why they do not comply. This Update briefly discusses some of the key changes to the Code, which relate to: director independence, board composition, director training, multiple directorships, alternate directors, remuneration, risk management and shareholder rights and roles.
To enter into transactions or investments on behalf of a client, a bank officer must first have his client’s authorisation. The issue of authority has been a source of much dispute in recent Singapore cases. It is thus important for banks to consolidate their position by keeping proper records and evidence of their client’s instructions. The case of Credit Industriel et Commercial v Toh Wai Cheong [2012] SGHC 94 is a prime example of the problems which may arise when phone conversations between a bank’s relationship manager and a client, during which instructions are issued, go unrecorded.
The Comptroller of Income Tax recently issued a public consultation on a proposal to adopt a rights-based approach to characterise the tax treatment of payments for the use of software, information and digitised goods. Such payments will be characterised according to whether the transaction involves a copyright right or a copyrighted article. Payments for copyright licences (viz. copyright rights which have not been completely alienated) will be treated as royalties and subject to withholding tax. Payments for copyrighted articles will be treated as business income in the hands of the recipient of the payment. If the recipient is non-resident, such payments would not be taxable in Singapore unless the recipient has a trade or business in Singapore or a permanent establishment in Singapore. This update discusses how the current tax treatment of such payments will be impacted by the proposed rights-based approach.
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