SPAC IPO SEC SGX HKEX Special Purpose Acquisition Company

Introduction

Special Purpose Acquisition Companies (SPACs) experienced explosive growth followed by significant regulatory scrutiny. This article examines the evolving regulatory landscape across major markets.

United States: SEC SPAC Regulation

The SEC has significantly increased SPAC regulation through proposed rules and enhanced enforcement.

  • Proposed SPAC Rules (2022): Enhanced disclosure, liability framework aligning SPACs with traditional IPOs
  • De-SPAC Transaction Disclosures: Extensive requirements for projections, conflicts of interest, and due diligence
  • PIPE Financing Disclosure: Enhanced transparency on private investments in public equity
  • Enforcement Actions: Increased scrutiny of projections and due diligence

European Union: SPAC Framework

EU SPACs operate under existing Prospectus Regulation and Market Abuse Regulation.

  • No dedicated SPAC regime; standard listing requirements apply
  • Euronext and Deutsche Börse have developed SPAC-friendly frameworks
  • Prospectus required at IPO and de-SPAC stage
  • Market abuse rules apply throughout SPAC lifecycle

Asia-Pacific SPAC Markets

Singapore: SGX SPAC Framework (2021)

SGX established the first dedicated SPAC regime in Asia with investor protections including:

  • Minimum market capitalization: S$150 million
  • Independent directors requirement
  • Sponsor lock-up and minimum shareholding requirements
  • De-SPAC completion deadline: 24 months (extendable to 30 months)

Hong Kong: HKEX SPAC Framework (2022)

HKEX implemented SPAC rules with significant investor protections:

  • Professional investor requirement (at least 75% of SPAC securities)
  • SPAC promoters eligibility criteria
  • Minimum market cap: HK$1 billion
  • Independent PIPE investment at de-SPAC (minimum 25% of merger proceeds)

Emerging Trends

  • Increased regulatory scrutiny globally
  • Enhanced disclosure requirements for projections
  • Greater liability exposure for SPAC sponsors and directors
  • Continued evolution of alternative listing vehicles