Better enforcement should accompany better market regulations

The Singapore Exchange (SGX) is taking the right steps in trying to shore up the stock market's continuous disclosure regime, but the question of enforceability and accountability remains a persistent hole that needs to be better filled.

SGX has launched a public consultation on a broad raft of proposed changes to the market's continuous disclosure rules. Many of those proposals are sound.

For instance, the current S$100,000 threshold for interested party transactions may be replaced. The existing rule, which applies to individual transactions, can be avoided by splitting contracts into smaller sizes, a practice that has happened, based on industry anecdotes. The proposed replacement considers interested party transactions in aggregate with the standard test of materiality applied, which seems to be a better way to address the issue.