Singapore Exchange revamps its regulatory framework to boost liquidity, simplify listings, and enhance transparency for investors.

The Singapore Exchange (SGX) has unveiled a sweeping reform of its regulatory framework — scrapping the long-standing financial watch list, easing listing thresholds, and adopting a more market-driven disclosure regime. The move aims to enhance liquidity, attract new listings, and strengthen Singapore’s position as a competitive global capital market.

A Shift Towards Market-Driven Regulation

Announced by SGX Regulation (SGX RegCo) after markets closed on October 29, 2025, the reforms mark a major step toward a “disclosure-based” regime — one that empowers companies to make their own disclosure decisions, provided they fully reveal material information to investors. SGX RegCo CEO Tan Boon Gin said the goal is to “reduce time to market and create more regulatory certainty,” while allowing price discovery to occur without unnecessary intervention.

Financial Watch List Officially Removed

A central change is the removal of the financial watch list, which previously flagged companies with persistent losses or low market capitalisation. SGX RegCo said the list, intended to motivate turnarounds, had unintended consequences — discouraging investors and limiting firms’ recovery prospects. All companies currently on the list will be automatically removed, though issuers must still announce three consecutive years of losses and are encouraged to communicate improvement plans to shareholders.

Lower Barriers for New Listings

In an effort to widen access to Singapore’s mainboard, SGX RegCo has lowered the profit test threshold for new listings from S$30 million to S$10 million, aligning with standards in major global exchanges. This revision enables more emerging companies — including those in high-growth sectors like artificial intelligence, green technology, and quantum tech — to list earlier and attract capital when they need it most.

Azure Capital CEO Terence Wong called the move “a positive shift,” noting that many firms just below the previous threshold are at pivotal stages of growth and in greater need of funding.

Adjusted Rules for Life Sciences and Pre-Revenue Firms

Recognising the unique nature of certain industries, SGX RegCo has introduced tailored admission criteria for pre-revenue life science companies. These include reducing the required operating record from three years to two and mandating at least one year of dedicated research and development. This flexibility allows innovative companies with strong growth potential to access public markets earlier without compromising investor protection.

Ending Public Trading Queries

SGX RegCo will also cease issuing public trading queries — which often triggered market hesitation — and instead engage privately with companies when non-material issues arise. Mr. Tan explained that generic public queries could have a “chilling effect” on trading, as investors feared sudden regulatory interventions. Going forward, only material concerns that affect investor decisions will trigger public disclosures, while “trade with caution” alerts will be issued when misconduct or unfair market conditions are detected.

Safeguarding Investor Confidence

While the rules are becoming more flexible, SGX RegCo reaffirmed its commitment to maintaining high governance standards. Unmodified audit opinions remain mandatory for listed issuers, ensuring compliance with financial reporting standards. SGX RegCo will also limit trading suspensions to cases where there is clear evidence of going concern issues, providing more certainty for both companies and investors.

Industry experts, including Kennedys Law partner Robson Lee and NUS Business School’s Professor Lawrence Loh, welcomed the changes. They noted that the shift to a disclosure-based model places greater responsibility on issuers and investors alike, encouraging a culture of transparency, accountability, and informed decision-making.

By removing rigid oversight mechanisms and lowering barriers for high-potential firms, SGX’s new framework signals a bold evolution toward a more dynamic and investor-driven market. The reforms are expected to strengthen Singapore’s position as Asia’s preferred hub for equity fundraising — balancing enterprise growth with prudent regulation, and ultimately creating a more vibrant marketplace for both local and international investors.

Sources: Straits Times (2025) , Business Times (2025)

Keywords: SGX, Singapore Exchange, Financial Watch List, Listing Rules, Market Reform, Investor Confidence