Foreign Company Registration Options in Singapore
Singapore offers a wide variety of options when it comes to setting up a business. The business-centered environment in the county located at the heart of the Asia Pacific offers foreign entrepreneurs to enjoy ease of business. If you are a foreign entrepreneur, Singapore gives you three company registration options to choose from, namely, a Branch Office, a Subsidiary Company, or a Representative Office.
Here’s a brief guide about each one of them so you can make the best choice according to your needs.
A branch office is a legal entity and is exactly like the name suggests—it is a branch of the foreign company, and it treated as such. This means that the main head office of the company will be held accountable for any and all liabilities of the Branch Office. It is also not eligible for tax exemptions and incentives that are available to the local companies in Singapore. A Branch Office is a better option for larger businesses than for small or medium-sized businesses.
Requirements for Registration of a Branch Office
1. Name of the Branch Office Must Be Same as the Head Office of the Company
The name of the Branch Office must be approved by the Company Registrar and must correspond to the foreign company.
2. At Least One Resident Authorized Representative
The Companies Act in Singapore requires that there should be at least one authorized representative who is a Singapore resident. A Singapore resident must be of or above eighteen years of age, and must hold a SingPass, an Employment Pass, an EntrePass, or a Dependent Pass.
3. A Company Registered Address
A company address must be registered, which should not be a P.O. Box number. It should be an address where your business will take place and where you can be reached.
Note: A Branch Office does not need to hire a Company Secretary.
A Subsidiary Company is one of the foreign company registration options you can choose from. It is a legal entity, just like a Branch Office, but differs from it as it is treated as a separate entity from the main company and the Subsidiary Company would be held accountable for its liabilities, not the head office of the company. This makes it a Limited Liability Company, and is a preferable option for the small and midsize businesses who wish to make their mark in the Singaporean business culture. The main company can own a hundred percent of the shareholding of its subsidiary company.
Requirements for Registration of a Subsidiary Company
1. An Approved Name
The name of your Subsidiary Company can be different from the name of the parent company. It should not be similar to any existing company or be offensive, and must be approved by the Company Registrar.
2. At Least One Resident Director
You are bound by the Companies Act to appoint at least one director who is a Singapore resident.
3. At Least One Company Secretary
Unlike the Branch Office, a Subsidiary Company is required to appoint a Company Secretary who is a Singapore resident.
If you need to test the waters of the Singapore market, you can set up a Representative Office in Singapore, which will conduct surveys and market research to see the feasibility of setting up a company and to create appropriate, research based strategies on expanding your business in Singapore. Or the purpose of gathering market intelligence, this is the best of the foreign company registration options. Like the Branch Office, a Representative Office is not a separate entity from the parent company.
Requirements for Registration of a Representative Office
1. Name of the Representative Office Must Be Same as the Head Office of the Company
Since it is not considered as a separate entity, the Representative Office’s name should be the same as that of the head office.
2. The Maximum Number of Employees Should be 5
The number of employees should not exceed from five.
3. Sales of Parent Company should be above US $250,000
In order to set up a Representative company, the revenues of the main company should meet the threshold of US $250,000.
4. Parent Company should be established for At Least Three Years
The parent company should be set up for three years or more before setting up a Representative Office in Singapore.
Note: A Representative Office can only operate for three years, after which it should convert to either a Branch Office or a Subsidiary Company in order to continue operating in Singapore.