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Share Loan Agreement for Singapore

Share Loan Agreement Template for Singapore

A Share Loan Agreement under Singapore law is a legally binding document that establishes the terms and conditions for the temporary transfer of shares from a lender to a borrower. It operates within Singapore's robust financial regulatory framework, particularly under the Securities and Futures Act, and includes provisions for collateral, voting rights, dividends, and return obligations. The agreement typically includes detailed mechanisms for transfer, risk management, and default scenarios, all while ensuring compliance with Singapore's financial regulations and MAS guidelines.

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What is a Share Loan Agreement?

A Share Loan Agreement is essential in Singapore's financial markets for facilitating securities lending transactions. This document is typically used when institutional investors or shareholders wish to temporarily transfer shares to borrowers for various purposes, including short selling, settlement coverage, or market-making activities. The agreement must comply with Singapore's Securities and Futures Act and MAS regulations, making it particularly important to include proper risk management provisions, collateral requirements, and clear mechanisms for transfer and return of securities. The document reflects Singapore's sophisticated financial infrastructure and regulatory environment, incorporating necessary safeguards for both lenders and borrowers.

What sections should be included in a Share Loan Agreement?

1. Parties: Identification of lender and borrower

2. Background: Context and purpose of the share loan arrangement

3. Definitions: Key terms used throughout the agreement

4. Loan of Securities: Core terms of the securities loan including quantity, type, and duration

5. Delivery and Return: Mechanics of transferring securities and return obligations

6. Collateral: Requirements for securing the loan

7. Rights and Obligations: Parties' responsibilities during loan period

8. Events of Default: Circumstances constituting default and consequences

9. Governing Law: Application of Singapore law and jurisdiction

What sections are optional to include in a Share Loan Agreement?

1. Voting Rights: Provisions governing the transfer and exercise of voting rights during the loan period

2. Tax Provisions: Specific provisions dealing with tax implications, treatment of dividends and tax obligations

3. Market Disruption: Provisions for handling market disruption events and their consequences

What schedules should be included in a Share Loan Agreement?

1. Schedule of Securities: Detailed list and description of securities subject to the loan

2. Form of Transfer Notice: Standard form template for initiating securities transfers

3. Collateral Requirements: Detailed specifications for acceptable collateral and maintenance requirements

4. Fee Schedule: Comprehensive details of lending fees, charges and payment terms

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Singapore

Publisher

Ƶ

Document Type

Loan Agreement

Sector

Banking

Cost

Free to use
Relevant legal definitions
































Clauses





























Industries

Securities and Futures Act (SFA): Primary legislation governing securities financing activities in Singapore, particularly Part VI which deals with Securities Financing arrangements

Companies Act: Core legislation governing corporate entities in Singapore, relevant for share transfers and corporate compliance requirements

Financial Advisers Act: Regulates financial advisory services and may be relevant if the share loan agreement involves financial advice

Banking Act: Applicable if any party to the agreement is a banking institution in Singapore

MAS Guidelines: Regulatory guidelines issued by the Monetary Authority of Singapore that may affect securities lending practices

SGX-ST Rules: Singapore Exchange Securities Trading rules, particularly relevant if the shares being loaned are listed on SGX

Securities and Futures (Securities Borrowing and Lending) Regulations: Specific regulations governing the mechanics and requirements of securities lending transactions

CDP Rules: Central Depository rules governing the custody and transfer of securities in Singapore

Contract Law: Common law principles governing contract formation, validity, and enforcement in Singapore

Stamp Duties Act: Legislation governing stamp duties applicable to share transfers and related documents

Personal Data Protection Act: Governs the collection, use, and disclosure of personal data in the agreement and related processes

AML/CFT Regulations: Anti-Money Laundering and Countering the Financing of Terrorism regulations applicable to securities transactions

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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