The Republic of Singapore is a southeast Asian city-state off the southern tip of the Malay Peninsula, 137 km north of the equator. It is a country made up of 63 islands. The British obtained sovereignty over the island in 1824 and Singapore became one of the British Straits Settlements in 1826. Singapore declared independence, uniting with other former British territories to form Malaysia in 1963, although it was separated from Malaysia two years later. Due to its close past connections with Britain, the business language remains English and the English common law system applies. Singapore is the world's fourth leading financial center, and its port is one of the five busiest ports in the world. The economy depends heavily on exports and refining imported goods, especially in manufacturing, which constituted 26% of Singapore's GDP in 2005.
Local currency is the Singapore Dollar and there is an excellent professional infrastructure with good legal services.
The Singapore Company
A company incorporated in Singapore may qualify as an Exempt Private Company, depending upon its turnover and shareholders. Exempt Private Companies enjoy a tax break on the first SGD 100,000 of net assessable profits for the first three years after incorporation.
A Singapore incorporated company may be resident or non-resident depending on its place of central management and control and the origin of its trading income. Where a company has the majority of its directors resident outside Singapore (there must always be one Singapore-resident director) and does not carrying on business in, or derive profits from, Singapore, it will generally only be taxable on income remitted to Singapore.
Clients are always advised to seek independent counsel's opinion concerning the details of any particular arrangements to ensure that full compliance with Singapore ordinances and laws is achieved.
Incorporation of a Private Limited Company
The proposed name of the company must first be approved by the Accounting and Corporate Regulatory Authority (ACRA) and an application has to be lodged with ACRA for their approval. ACRA would revert within the same day of the name application if no further referral is required.
First Directors and Subscribers
Each company must at all times have at least one director, who must be a local resident. Corporate directors are not permitted. If there is more than one director, one of whom must be a local resident. A local resident director is one who is a Singapore citizen, a permanent resident of Singapore or a holder of Singapore Employment Pass. The first directors of a company are named in the articles, subsequent directors are usually elected at annual general meetings, which are a common stipulation in the Articles of Association or appointed by the existing director(s) of the company.
There must be a minimum of one subscriber to the Memorandum and Articles of Association ("M &A"). The subscriber is required to take up at least one share to form the company and the subscribers' shares can be transferred to the beneficial owners after incorporation. Bearer shares are not permitted but corporate shareholders are allowed. For reasons of expediency, the individuals who act as the first directors should preferably act as the subscribers as both subscribers and first directors are required to sign the incorporation documents.
Every company shall have one or more secretaries each of whom shall be a natural person who has his principal or only place of residence in Singapore. The office of company secretary must not be left vacant for more than six months at any one time.
Memorandum & Articles of Association
The company must adopt a set of Memorandum and Articles of Association (M & A) for incorporation purpose.
The company will need to have a registered address in Singapore as from the date of its incorporation which must be a physical address and not just a Post Office box.
With effect from 30th January 2006, the Singapore Companies Act, Cap. 50 had abolished the concept of authorized share capital and par value of a share. The company must issue a minimum of one share when seeking incorporation. The company may then allot further shares after incorporation.
Appointment of Auditors
The Companies (Amendment) Act 2003 exempts dormant companies (companies with no significant accounting transactions) and small exempt private companies (i.e., a private company with no corporate shareholder and whose annual turnover/revenue does not exceed the prescribed threshold of $5 million) from the requirement of appointing auditors. However, private companies must appoint auditors if they do not satisfy all the conditions to qualify for exemption from audit.
Annual General Meetings and Filing of Annual Returns
Every company must hold its first annual general meeting within 18 months after its incorporation. Subsequently, an annual general meeting must be held at least once in every calendar year. The interval between two general meetings should not be more than 15 months. Subject to the Companies (Amendment) Act 2003, private companies may dispense with annual general meetings.
An annual return must be made even if the annual general meeting is dispensed with.
All companies are provided with a complete company kit, including share certificates, M &As, statutory registers and common seal.
Corporate Secretarial Services
We provide on-going secretarial services for Singapore companies. Our scope of duties covers the following:
- provision of a qualified Chartered Secretary as company secretary
- maintaining and updating of Company's statutory registers and records.
- filing of all necessary documents and forms with ACRA.
- supplying of draft notice, agenda and minutes for Annual General Meetings.
- making available the statutory registers and records for inspection by the client's auditors or other authorized persons.
Nominee Director Services
In addition to providing secretarial services to Singaporean companies, we are able to provide our clients with nominee director services if required. A copy of our Nominee Director & Shareholders Services Agreement stating the terms and conditions for nominee director services would be provided upon request.