Introduction
The Corporate and Accounting Laws (Amendment) Act 2025, passed by the Singapore Parliament on 5 November 2025, represents one of the most significant overhauls of Singapore’s corporate governance framework in recent years. With most of its provisions commencing from April 2026, the Act introduces sweeping changes across multiple pieces of legislation — including the Companies Act 1967, the Insolvency, Restructuring and Dissolution Act 2018, the Limited Liability Partnerships Act 2005, and the Variable Capital Companies Act 2018.
Whether you are a company director, shareholder, corporate secretary, or business owner, these amendments will affect how your company operates, how shareholders are protected, and how accountable directors are expected to be. This article breaks down the key changes and what they mean for Singapore businesses in practical terms.
If you are responsible for corporate compliance in Singapore, understanding these amendments is essential to staying on the right side of the law.
Background: Why These Amendments Were Introduced
The Corporate and Accounting Laws (Amendment) Bill was introduced following a public consultation exercise conducted by the Ministry of Finance (MOF) and the Accounting and Corporate Regulatory Authority (ACRA). The consultation sought feedback on proposed reforms to:
(a) Tighten rules against the misuse of companies for unlawful purposes;
(b) Safeguard shareholders’ interests, particularly those of minority shareholders;
(c) Strengthen the regulatory framework for companies and reduce regulatory burden; and
(d) Enhance the regulatory regime for public accountants.
These goals reflect Singapore’s ongoing commitment to maintaining its reputation as a trusted and transparent business hub. With the amendments now in force, companies need to take immediate steps to ensure they are compliant.
Key Change 1: Sole Directors Can Now Act as Company Secretaries
One of the most practical changes for small businesses is the amendment to the company secretary requirement. Previously, under Section 171 of the Companies Act, a sole director was prohibited from simultaneously holding the position of company secretary. This meant that even a one-person company had to engage a third-party corporate secretary — an additional cost that many micro-enterprises found burdensome.
Under the new provisions, a sole director may now be appointed as the company secretary, provided that the individual can demonstrate the requisite knowledge and experience to fulfil the role effectively. This change is particularly beneficial for small private limited companies with lean structures, as it removes the mandatory requirement to engage an external provider solely to fill the company secretary position.
That said, the role of a Singapore company secretary remains demanding — involving statutory filings, maintenance of registers, and ensuring ongoing compliance. Many directors may still find it prudent to engage a professional corporate secretary, especially as the advisory roles of a corporate secretary extend well beyond mere administrative duties.
Key Change 2: Significantly Higher Penalties for Directors in Breach of Duties
Directors should pay close attention to the amendments to Section 157 of the Companies Act, which imposes the duty on directors to act honestly and with reasonable diligence in the best interests of the company. Previously, a breach of this duty attracted a maximum fine of S$5,000 — a penalty that many considered too low to serve as an effective deterrent.
Under the new amendments, the maximum fine has been increased fourfold to S$20,000. In serious cases involving negligence or wilful failure to act in the company’s best interests, directors may now face imprisonment for a term not exceeding 12 months, or both a fine and imprisonment.
This is a clear signal from the Government that director accountability is being taken more seriously. If you serve as a director of a Singapore company, it is essential that you understand your statutory duties. For a comprehensive overview of what is expected when you first take on a directorship, see our guide on appointing your first directors in Singapore.
Directors should also ensure they are properly informed about their financial reporting responsibilities, as failures in this area could now carry far more serious consequences.
Key Change 3: Stronger Protections for Minority Shareholders
The 2025 amendments introduce several provisions aimed at better protecting the interests of minority shareholders. The overarching intent is to ensure that shareholders have adequate recourse when their rights are affected by corporate decisions made by the majority.
Two-Tier Approval for Selective Off-Market Share Buybacks
One of the most notable changes concerns the selective off-market purchase or acquisition of a company’s own shares under Section 76D of the Companies Act. Previously, the approval process for such transactions could, in certain circumstances, fail to adequately account for the interests of shareholders within an affected class who were not part of the buyback.
The new two-tier approval process requires:
(a) Approval by the members of the company, excluding the target shareholder(s); and
(b) Approval by the relevant members within the affected class of shares, excluding the target shareholder(s).
Both tiers require a 75% approval threshold. This ensures that the voting rights of shareholders within a class who are not targeted are not diluted, and that minority shareholders in specific share classes have a meaningful say in the process.
For companies that hold treasury shares, these changes will affect the procedures they follow when undertaking share buybacks. Boards should review their existing share buyback mandates in light of the new requirements.
Higher Thresholds for Variation of Class Rights
The amendments also introduce higher approval thresholds for the variation of class rights attached to different classes of shares. This is designed to reduce the risk of abuse of power by majority shareholders and to ensure that decisions affecting specific classes of shares receive proper scrutiny and consent from the affected shareholders.
Understanding the distinction between shareholders and members is crucial when navigating these new provisions, as the approval requirements may differ depending on the company’s structure.
Key Change 4: New Grounds for Refusal of Company Registration and Restoration
To combat the misuse of corporate entities for unlawful purposes, the amendments now expressly specify grounds for the Registrar of Companies to refuse the registration of a company or limited liability partnership (LLP). Similarly, the Act provides that a court or the Registrar must refuse an application for the restoration of a struck-off entity where:
(a) The restored entity is likely to be used for an unlawful purpose or for purposes prejudicial to public peace, welfare, or good order in Singapore; or
(b) It would be contrary to the national security or interest for the entity to be restored.
This is a significant tightening of the rules. Companies that have been dormant for extended periods or have been struck off should be aware that restoration is no longer automatic and will be subject to closer scrutiny.
Key Change 5: Reduced Regulatory Burden for Companies
Not all the changes impose stricter requirements. The amendments also aim to reduce the regulatory burden on companies in several ways. For instance, the streamlining of certain filing and compliance requirements with ACRA is intended to make it easier for companies to fulfil their statutory obligations without unnecessary administrative overhead.
The Act also amends the Accounting and Corporate Regulatory Authority Act 2004 and the Accountants Act 2004 to enhance the regulatory regime for public accountants, which should improve the overall quality and reliability of financial reporting in Singapore.
Companies should review their existing compliance processes — including their annual return filing procedures and financial reporting standard selection — to ensure they are aligned with the updated requirements.
What Should Your Company Do Now?
With these amendments now in force, here are the practical steps every Singapore company should consider:
1. Review your board’s understanding of director duties. The increased penalties under Section 157 mean that directors can no longer afford to be passive or uninformed. Ensure all directors are briefed on their statutory obligations and the consequences of non-compliance.
2. Assess whether you need a company secretary. If you are a sole director of a small company, you now have the option to act as your own company secretary. However, consider whether you have the knowledge and bandwidth to manage the role effectively, or whether engaging a professional remains the better option.
3. Review share buyback mandates and shareholder agreements. If your company has any existing mandates for selective off-market share purchases, these must now comply with the new two-tier approval process. Shareholder agreements should also be reviewed to ensure they reflect the updated legal framework.
4. Update compliance checklists. Your company’s compliance checklist should be updated to reflect the new provisions, including any changes to filing requirements and reporting obligations.
5. Understand the implications for company constitutions. Some of the amendments may affect the provisions in your company’s constitution. It is worth reviewing your constitution to ensure it remains consistent with the updated legislation.
Conclusion
The Corporate and Accounting Laws (Amendment) Act 2025 represents a comprehensive modernisation of Singapore’s corporate governance landscape. From higher penalties for errant directors to stronger protections for minority shareholders and new flexibility for sole directors, the changes affect virtually every company incorporated in Singapore.
Staying compliant is not just a legal obligation — it is fundamental to maintaining the trust and confidence that makes Singapore one of the world’s premier business jurisdictions. If you need assistance understanding how these amendments affect your company or require help updating your compliance processes, the team at Raffles Corporate Services is here to help.
— The Editorial Team, Raffles Corporate Services