Sanctions compliance and Singapore listing rules: Risks beyond Singapore sanctions

Sanctions Compliance expectations from the SGX – the risk is global

The SGX has made it clear that it expects listed companies to have strong systems in place to manage sanctions laws-related risks.

Under Rule 719(1) of the SGX Listing Rules, issuers are required to maintain “adequate and effective systems of internal controls … and risk management systems.” The SGX in its 2022 regulator’s column “What SGX expects of issuers in respect of sanctions-related risks, subject or activity” (SGX Guidance) just after the invasion of Ukraine emphasised that “adequate and effective” internal controls means having appropriate safeguards to address sanctions-related risks.

This Guidance followed the Monetary Authority of Singapore’s announcement of sanctions against Russia in response to its invasion of Ukraine. At the time, we explored these developments in our article “Singapore unveils sanctions against Russia” and one year later, we revisited the impact in “Where are we now? One year on and the impact of Singapore’s sanctions of Russia”, highlighting Singapore’s sharpened focus on sanctions enforcement.

Whilst the SGX Guidance was released in response to Russia’s invasion, its scope extends beyond Russia-related sanctions and addresses sanctions-related risks in general. Crucially, the SGX Guidance:

• Does not limit compliance obligations to Singaporean sanctions. It refers broadly to “sanctions-related risks” and “any applicable Sanctions Law,” including those imposed by international bodies and national governments. The United States regularly investigates, penalizes, and sanctions companies operating across Asia and in Singapore, including for sanctions and export controls violations. Most recently, in March 2025, a Singapore-based shipping firm was sanctioned by the U.S for allegedly transporting oil to Iran. This followed earlier U.S sanctions in May 2024 against another Singaporean shipping firm, which was reportedly involved in delivering materials for the construction of a Russian LNG project in the Arctic circle.  

• States that issuers should assess their sanctions risk on an ongoing basis, and that boards should consider obtaining external legal advice on whether particular dealings may be in breach of, or expose to adverse measures under, foreign sanctions.
• Requires issuers to disclose material sanctions-related developments, including if they become a “Sanctioned Subject” under a foreign regime, and potentially suspend trading in their listed securities.

This reflects a clear regulatory expectation: SGX-listed issuers must proactively manage the risk of foreign sanctions (such as those of the U.S., UK or the EU), not just Singapore’s own regime.

It also aligns with a trend we highlighted last year in our article, “Recent Singapore decisions highlight sanctions and export controls enforcement”, where we noted Singapore’s increasing willingness to take action in response to sanctions violations and not just those of Singapore-imposed sanctions. With the U.S. and European sanctions regulators willing to take extra-territorial approaches on enforcement, the complicated geopolitical landscape creates new risks for companies listed on SGX.

This is particularly pertinent given that Singapore has expressed similar expectations in relation to export controls. In 2025, the Ministry of Trade and Industry and Singapore Customs issued a joint advisory statement on export controls on advanced semiconductor and AI technologies. The advisory emphasised that businesses operating in Singapore must take into account the implications of foreign export controls on their international activities, and warned that Singapore does not condone any attempt to use its jurisdiction to circumvent or violate such foreign laws.

What this means for Listed Companies or IPO Candidates as well as all entities within their group

For SGX-listed companies and those preparing for IPO, the SGX Guidance carries several implications:

• Sanctions compliance is not just a back-office issue. Boards and senior management must be actively involved in assessing and mitigating sanctions exposure across all jurisdictions in which the company operates or transacts.
• Sanctions risk must be assessed on a global, group-wide basis. All sanctions laws that are applicable to a group’s entities must be identified and then reviewed in terms of the risk of violations or conduct that is sanctionable via extra-territorial measures. 
• Regulators offer guidance on what a sanctions and export controls compliance program should look like, and companies should review those recommendations in the context of their own business.
• Legal advice may be required to assess high-risk transactions or relationships, especially where operations involve countries or sectors commonly subject to foreign sanctions (e.g., Russia, Myanmar, Iran, or specific China-related entities or activities).
• Due diligence and internal controls must be reviewed and, where necessary, strengthened to ensure timely detection, escalation, and disclosure of sanctions-related issues.

This is especially critical for companies with international supply chains, financing arrangements, or cross-border operations, where the risk of inadvertently running afoul of a foreign sanctions regime can be significant.

How we can help

SGX-listed companies and IPO candidates must look beyond Singapore’s laws and proactively manage global sanctions risks based on the groups entities operations and legal presence. Hogan Lovells is well placed to help businesses navigate these cross-border challenges given our extensive local, regional, and global experience in sanctions-related matters.  We have on the ground experts in Washington D.C, London, Brussels, across continental Europe, Hong Kong, China and Singapore. Our International Trade and Investment team has the unique combination of in-depth industry understanding and experience working with a wide range of government officials in the U.S., UK, EU and Asia.

We have advised leading financial institutions, life sciences entities and global technology companies, amongst others, on designing and implementing policies and procedures to ensure compliance with Singapore’s sanctions regime. This experience enables us to effectively:

• Review and enhance internal compliance programs in line with SGX and global regulator expectations;
• Conduct sanctions risk assessments for specific transactions or jurisdictions; and
• Provide legal opinions on the applicability of both local and foreign sanctions laws.

The message from the SGX is clear: sanctions risk management is not optional and listed companies or companies looking to list in Singapore must take a global view of their sanctions-related risk. We are here to assist.

Authored by Khushaal Ved, Aline Doussin, Ben Kostrzewa, Aleksandar Dukic, Percy Ting and Paris Buti.