Are class actions good for investors and Singapore markets?
INVESTOR lobby group Securities Investors Association (Singapore), or SIAS, announced this week that it will not hesitate to take errant companies to court - representing minority investors in class-action suits more commonly seen in jurisdictions like the United States.
The association's announcement begs the question: is such an action a viable alternative for minority investors here seeking to bring recalcitrant companies to heel? To answer that, we need to examine if such an action can be successfully brought about, if it will yield the outcome that investors desire, and if this will impact positively on Singapore's capital markets.
To begin with, class-action suits - or representative actions, which include class actions - are not often seen in our courts. Singapore is, by nature, not a litigious society; and it is even less common to have large groups of people pursuing similar legal redress against the same party.
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