The Monetary Authority of Singapore (MAS) released a consultation paper on Tuesday, recommending a mandate that Reits hold such annual meetings (AGMs).
Under the proposal, Reits will have to hold it an AGM once every calendar year, not more than 15 months from the last preceding AGM, with effect from Jan 1 2010.
This means all Reits will have to hold an AGM by Dec 31 2010.
Reits also have to hold AGMs within 4 months from their financial year end, in line with the Singapore Exchange's (SGX's) rules for other listed issuers.
The regulator explained on Tuesday that this move will 'enhance corporate governance... by providing an important channel for communication' between Reit managers and unitholders and for the former to be more accountable.
It will also 'provide a regular opportunity for managers to seek general mandates from unitholders for issuance of new units and thus accord greater flexibility for equity raising', MAS added.
Market observers have already welcomed this move, first announced by SGX in February that MAS was looking into making AGMs compulsory for Reits.
In its consultation paper, MAS noted that this is already practiced in countries such as the United States. And while mandating AGMs is not common in other jurisdictions, AGMs are recommended in Hong Kong and Australia.
'It would also be consistent with international best practice, which suggests that AGMs are an important component of good corporate governance,' said MAS.
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