Dealings with Interested Persons Review Procedures for Interested Person Transactions The Manager has established internal control procedures to ensure that all Interested Person Transactions are undertaken on an arm’s length basis and on normal commercial terms, which are generally no more favourable than those extended to unrelated third parties, and are not prejudicial to the interests of CLCT and Unitholders. In respect of such transactions, the Manager would have to demonstrate to the ARC that such transactions are undertaken on normal commercial terms and are not prejudicial to the interests of CLCT and Unitholders which may include obtaining (where practicable) third party quotations or obtaining valuations from independent valuers (in accordance with applicable provisions of the Listing Manual and the Property Funds Appendix). The internal control procedures also ensure compliance with Chapter 9 of the Listing Manual and the Property Funds Appendix. In particular, the procedures in place include the following: Interested Person Transactionsi Approving Authority, Procedures and Disclosure S$100,000 and above per transaction (which singly, or when aggregated with other transactionsii with the same Interested Person in the same financial year is less than 3.0% of CLCT’s latest audited net tangible assets/net asset value) • Management • Audit and Risk Committee Transactionii which: (a) is equal to or exceeds 3.0% of CLCT’s latest audited net tangible assets/net asset value; or (b) when aggregated with other transactionsii with the same Interested Person in the same financial year is equal to or exceeds 3.0% of CLCT’s latest audited net tangible assets/net asset value • Management • Audit and Risk Committee • Immediate announcement Transactionii which: (a) is equal to or exceeds 5.0% of CLCT’s latest audited net tangible assets/net asset value; or (b) when aggregated with other transactionsii,iii with the same Interested Person in the same financial year is equal to or exceeds 5.0% of CLCT’s latest audited net tangible assets/net asset value • Management • Audit and Risk Committee • Immediate announcement • Unitholdersiii i This table does not include the procedures applicable to Interested Person Transactions falling under the exceptions set out in Rules 915 and 916 of the Listing Manual. ii Any transaction of less than S$100,000 in value is disregarded. iii In relation to approval by Unitholders for transactions that are equal to or exceed 5.0% of CLCT’s latest audited net tangible assets/net asset value (whether singly or aggregated), any transaction which has been approved by Unitholders, or is the subject of aggregation with another transaction that has been approved by Unitholders, need not be included in any subsequent aggregation. A summary of Interested Person Transactions entered into within the financial year will be submitted by the Manager to the Trustee, and submitted by CLI IA to the ARC for review on an annual basis. Guidelines and procedures established to monitor Interested Person Transactions will be audited by CLI IA on a periodic basis. Role of the Audit and Risk Committee for Interested Person Transactions The Manager’s internal control procedures are intended to ensure that Interested Person Transactions are conducted at arm’s length, on normal commercial terms and are not prejudicial to CLCT and Unitholders’ interests. The Manager maintains a register to record all Interested Person Transactions which are entered into by CLCT (and the basis on which they are entered into, including the quotations obtained to support such basis). All Interested Person Transactions are subject to regular periodic reviews by the ARC, which in turn obtains advice from CLI IA, to ascertain that the guidelines and procedures established to monitor Interested Person Transactions, including the relevant provisions of the Listing Manual and the Property Funds Appendix, as well as any other guidelines which may from time to time be prescribed by the SGX-ST, MAS or other relevant authorities, have been complied with. The review includes an examination of the nature of the transaction and its supporting documents or such other information deemed necessary by the ARC. If a member of the ARC has an interest in a transaction, he or she is to abstain from participating in the review and approval process in relation to that transaction. In addition, the Trustee also reviews such audit reports to ascertain that the Listing Manual and the Property Funds Appendix have been complied with. CORPORATE GOVERNANCE 140 CAPITALAND CHINA TRUST
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