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Q1. What are the key requirements for setting up a Singapore company?
- A company needs to have at least one shareholder who can be a local or foreign individual or company.
- At least one of the directors must be a natural person, above the age of eighteen years old, and a resident of Singapore.
- A shareholder who is a natural person can also be a director of the company.
- A qualified company secretary has to be appointed. The secretary must be a resident of Singapore.
- Company must have a physical, local address in Singapore.
- The company must have a paid up capital of at least $1.
Q2. What are the minimum and maximum number of shareholders a company can have?
A Singapore Private Limited Company (LLC) registration requires at least 1 shareholder. A Private Limited Company can have a maximum of 50 shareholders.
Q3. How many directors are required to set up a company in Singapore?
Incorporation of a Private Limited Company in Singapore requires at least one director. There is no limit on the maximum number of directors, although a maximum number is usually stated in the Constitution of the Company. A director must be a natural person and a corporate entity cannot be a director. Furthermore, at least one of the directors must be a resident of Singapore.
Q4. Is having a local director necessary for a Singapore company?
Yes, it is necessary for a Singapore company to have at least one director who is a local resident. In order to qualify as a local resident of Singapore, the individual has to be a Singapore citizen, a Singapore permanent resident or an Employment Pass holder (the employment pass must be from the same company where the individual wants to be a director). Furthermore, the local director must be a natural person above the age of 18 years and not a corporate entity.
Foreign companies or entrepreneurs who wish to incorporate and operate a Singapore company can either
- have a foreign executive relocate to Singapore to act as the resident director (subject to the approval of their work pass); or
- use the nominee director service of a corporate services firm to meet the resident director requirement.
Q5. What is the procedure for registering a Singapore company?
Company registration procedure in Singapore consists of two simple steps:
Company Name Reservation
Before registering a new company in Singapore, the company name must be reserved. Therefore, application to reserve your proposed company name must be filed first. If the proposed company name does not conflict with any existing names and does not fall into the category of undesirable names, it should take only 10-15 minutes to get the company name approval. Once approved, the name will be reserved for you for 60 days from the date of approval.
Incorporation of the Company
The online application to register a company can be filed after approval of the company name has been obtained. The following information must be provided as part of the application:
- Details of business activities
- Details of the shareholder(s) and the shares issued to them
- Details of the company director(s)
- Details of company secretary
- Details of registered office
- Signed Constitution of the Company
If you use a professional services firm like us, the firm can assist in ensuring that the information in your application is accurate and complete. If everything is in order, the incorporation application will be processed within a few minutes and you will receive a notice of incorporation via email. Note that the incorporation approval can take longer if the application is referred for additional review by the company registrar.
Q6. What are the guidelines for naming a Singapore company?
The first step in the registration of a Singapore company is reserving a name for the company – a company cannot be registered without having an approved name beforehand. The requirements for a company name are that the selected name should not conflict with any other existing name, and it should not contain any offensive or degrading words.
There are three possible outcomes when you submit a name request:
- If the name is approved, the entrepreneur can proceed to the next step of incorporating the company with that name.
- If the name is “referred”, it means that the name will be referred for additional review by other government departments and a final outcome will be available in anywhere from a few days to a few weeks.
- If the name is rejected, the applicant has to submit a new name.
Q7. Does a foreigner need to visit Singapore to establish a company?
No, you do not have to be physically present in Singapore to setup a company. All incorporation related paperwork can be executed online without your physical presence in Singapore. However, as part of the KYC procedures the bank authorities may require an interview with one or more of the key persons of the company. This may necessitate a visit to Singapore to open the bank account.
Q8. Who can open a company in Singapore?
Any person, irrespective of his or her nationality can open a company in Singapore as long as they are above the age of 18 and have not been declared a bankrupt.
Q9. Who can register as a shareholder in a company?
A shareholder can be an individual or another corporation, including a foreign corporation. Singapore company law allows 100% foreign shareholding. Thus, a foreigner can register a Singapore company as its sole shareholder.
A foreign company can set up a 100% owned local Singapore company (often called as a subsidiary company). A subsidiary company is by far the most popular type of business structure for foreign companies operating in Singapore. This is due to the liability protections and the favorable tax treatment available to this structure.
Q10. Will the identity of directors and shareholders be made public?
Yes, basic information about the shareholders and directors of a company is available to the public. The Registrar of Companies lists this information in the business profile of the company which can be purchased by any person for a nominal fee.
Q11. What business structures are possible in Singapore?
The business entities allowed in Singapore include sole proprietorships, partnerships, and limited liability companies. Among the three, private limited liability company is the most common form of legal structure in Singapore.
Q12. Does a company require a registered address to operate a business in Singapore?
According to Singapore Company Law, before setting up a new firm, each company must have a local Singapore address as the registered address of the company. A registered address serves as the address of your business for legal purposes and for receiving official correspondence. Your statutory records should also be kept at this address. The address cannot be a PO Box number and must be a commercial address (residential address are allowed in a limited number of circumstances).
In general, the address of the company secretary is used as the registered address since the company secretary maintains the statutory books. If you have a corporate office and wish to use that as the registered address then you should ensure that the company secretary is based there and the company’s statutory books and records are maintained at that address. If you use a corporate services firm, it can provide the registered address service for you for a service fee.
Q13. Do I need any business licenses to operate my Singapore company?
Depending upon the nature of business you plan to conduct, you may require a business license from the relevant regulatory authority. For example, a restaurant as well as a financial services firm will need a license from their respective regulatory authorities.
Fortunately, bureaucratic hurdles are kept to a minimum in Singapore and most types of businesses do not require a license. Even if a license is required, you can be assured of a quick, efficient and straightforward approval process for your license application.
Q14. What is paid-up capital? How much capital is required to establish a company in Singapore?
It is the total amount of capital provided to the company by its shareholders. In most cases, it represents the amount of cash that the shareholders have paid to the company to purchase its shares. The minimum required paid-up capital for a Singapore company is $1.
However, if the business is a regulated business that requires a license, a higher paid-up capital may be required as part of the licensing requirements.
Q15. What are the qualifications for being a Company Secretary?
To become a company secretary of a Singapore company, the individual must be a natural person and a resident of Singapore. He or she must be well versed with the Singapore Companies Act and should have relevant experience. If a company has a single director (who has to be a Singapore resident) then the same person cannot be the company secretary.
Q16. How long does it take to reserve a name for a Singapore company?
Name reservation for a new company takes only a few minutes if there is no objection from ACRA to the selected name. However, if the selected name is in any way found to be objectionable then the approval may take longer.
Q17. Can a residential address be used as the company address?
Yes, this is possible in a limited number of situations.
Q18. To establish a company, do foreigners need to have local partners?
It is not necessary for a foreigner to have a local partner. The Singapore law allows foreign citizens to have 100% ownership in a Singapore company. So, there is no need to have a local partner.
Q19. Can a foreigner relocate to Singapore to operate the new business?
Yes, it is possible for a foreigner to relocate to Singapore to handle the day to day affairs of the business by obtaining a work pass visa. Note that the application for work pass is subject to approval by Singapore government.
Q20. Can a Singapore company hire foreigners?
Yes. Subject to the approval of corresponding work pass application, a Singapore company can hire a foreigner. Depending on the skill and qualification of the employee, different types of work passes are available.