The Newspaper and Printing Presses Act (NPPA) will apply to the new non-profit media company spun off from Singapore Press Holdings (SPH).
Communications and information minister S Iswaran confirmed this in a ministerial statement on May 10 in Parliament.
What you need to know about the SPH restructuring
SPH is the parent company of Singapore's big newspapers, such as The Straits Times, Berita Harian, Lianhe Zaobao, etc.
However, SPH's media business has suffered losses due to a decline in advertiser revenue, and it believes this trend will continue.
On May 6, SPH announced that it will spin off its media business into SPH Media Holdings Pte Ltd, a Company Limited by Guarantee (CLG). A CLG is usually used to carry out non-profit activities.
Such non-profit organisations need corporate status to carry out certain activities, such as applying for credit or buying and selling property.
During the press conference on May 6, SPH Chairman Lee Boon Yang noted that this development meant that SPH at large will no longer be bound by the NPPA.
Iswaran explained that the CLG will also not be bound by the NPPA.
However, it will apply to the new media company under the charge of the CLG. The CLG will also have "appropriate safeguards" in its constitution.
What is the Newspaper and Printing Presses Act?
The NPPA was introduced in 1974 by the government of then-Prime Minister Lee Kuan Yew. It imposes certain restrictions on newspaper companies publishing in Singapore.
For example, one of the provisions in the Act requires newspaper companies like SPH to issue two classes of shares, ordinary and management.
Ordinary shareholders can each hold no more than five per cent of the company's shares, except with the approval of the communications and information minister.
Iswaran said that this prevents "excessive influence" over local newspapers from any single source, whether local or foreign.
Management shareholders have special voting rights on resolutions relating to the appointment of directors and staff of the newspaper company. The issuance of management shares, and the appointment of directors, must be approved by the Minister.
The directors of SPH also hold a small number of management shares.
Iswaran explained that the intent "has always been" for these management shares to be held by "reputable and established institutions", so that the stewardship of the newspaper is entrusted to entities with an abiding interest in, and a commitment to Singapore's stability and success.
CLG's management shareholders
Currently, the largest management shareholders of SPH are:
- Temasek via Fullerton Pte Ltd
- OCBC Bank
- Great Eastern
- NTUC Income
- The National University of Singapore (NUS)
- The Nanyang Technological University (NTU)
Iswaran said that he met with the representatives of the management shareholders, who have all agreed to form the CLG and be its founding members.
He added, "This will ensure that our local news media will remain in the hands of trusted institutions with a long-term stake in Singapore."
Iswaran also mentioned that in "due course", newer and "more diverse" institutions will join the current roster as shareholders and stakeholders of SPH Media.
Previously, Minister K Shanmugam said the government might support the media and are prepared to fund the new subsidiary.
Iswaran repeated this in his statement, saying that the government is willing to fund the CLG in areas like digital innovation and capability development as part of a long-term, sustainable business plan.
"We already have a similar financing model with Mediacorp, our core national broadcaster, which has been working well," he said.
Top image from Gov.sg.