“Twenty years from now, you will be more disappointed by the things you didn’t do than those you did. So throw off the bowlines. Sail away from safe harbor. Catch the wind in your sails. Explore. Dream. Discover.”
Mark Twain’s words are music to entrepreneurs who want their dreams to cross borders and seas.
But for entrepreneurs who are ready to do business abroad, the reality is not as simple as hopping from one island to another.
There will be adjustments left and right plus a long to-do list: resources, market research, new workforce, and most of all, the bureaucratic routes and legal maze in setting up a business.
But you can write a different story depending on the country of your choice.
Like Singapore.
Why?
√ Flourishing business environment
√ Attractive tax scheme
√ Transparent policies
√ Uncomplicated incorporation process
In fact, the 2015 Global Startup Ecosystem Ranking shows that Singapore is the best startup ecosystem in Asia today. The report affirms that Singapore’s “business-friendly environment is a fertile ground for startups, with 2,400-3,600 active tech startups calling the city-state home.”
Are you ready to register your business in Singapore?
Step #1 – Study the setup profiles you can choose from.
You have three options on how you can form your company in Singapore:
Representative Office
It is for you: If you are a foreign entrepreneur who wants to get a feel of the business atmosphere of Singapore first before formally launching your business
Your activities: ROs are allowed to conduct market research and feasibility studies. Your activities can include studying the local market, your competitors, and your prospective customers; joining trade exhibitions; analyzing product or service demand, pricing trends, and market needs; and researching the procedures and required documents for setting up a permanent company in Singapore.
Your RO should have a representative from the parent company, but you may hire locals as employees.
But: You are not allowed to run activities that can generate revenue, sales, or payment for any of your services.
Your timeframe: ROs cannot remain as ROs for an indefinite time. Your office can only operate for a maximum of three years from the time it commenced.
Your RO cannot re-register as RO.
Your next feasible option is to incorporate an entity with the Accounting & Corporate Authority (ACRA) of Singapore.
Subsidiary Company
It is for you: If you are fully decided about starting your business in Singapore as a separate entity from the foreign company
Your activities: The foreign company can have 100% ownership of the subsidiary company. The subsidiary company can perform all types of business activities and be qualified for tax incentives that local firms enjoy. Incorporated as a limited liability company, the subsidiary company will be treated as a unique entity and not part of the foreign company. Your name does not have to be the same as that of the parent company.
But: The foreign company is not directly accountable for the subsidiary company’s liabilities and undertakings.
Your timeframe: Indefinite until deregistration.
Branch Office Registration
It is for you: If you wish to expand your business operations in Singapore
Your Activities: As a Singapore Branch Office, your business will operate as part of the foreign parent company.
Thus, less hassle for you.
The foreign parent company will still be legally responsible for all your activities in Singapore. Since the Branch Office acts as an extension, the head office will govern your shareholders, organizational structure, and other undertakings through its Memorandum and Articles of Association.
Branch Offices should perform only the business activities being carried out by their head offices.
If Branch Office Registration is the strategic move for your business, the head office should prepare the following requirements:
√ Certified copy of the company’s incorporation certificate in the foreign country
√ Certified copy of the instrument defining its constitutions
√ The list of all directors with their particulars
√ Should one of the company’s directors be a Singapore resident and member of the Singapore’s board of directors, a memorandum stating the powers of the local directors is required
√ Memorandum of Appointment or a power of attorney of 2 or more local agents who are authorised to accept notices on behalf of the branch. These local agents should be natural residents in Singapore
√ A statutory declaration following the prescribed form made by said agents that confirm the brand’s particulars
√ Location notice of the company’s registered office in Singapore
As for the people who will take care of your Branch Office, you also have the option to either:
1. incorporate a Singapore Branch Office and send your executives to the country to manage the operations
2. or put up a Branch Office in Singapore and hire services of two nominated local agents first to meet the legal requirement of two local agents
But: Because of its legal identity, a Branch Office is not regarded as a resident in Singapore so it is not qualified for tax incentives or exemptions.
Timeframe: Forever until closure
Step #2 – Select which of the three setup profiles is best for you.
Bottom line:
√ If you got a bee in your bonnet about establishing a business in Singapore but you want to see first if it will fly in the country, start with a Representative Office.
√ If you’re willing to dive into the business scene in Singapore on your own and not as part of a parent company, form a Subsidiary Company.
√ If you already have a fantastic business and want to introduce it to the Asian market by starting with Singapore, the region’s leading financial hub, then it’s time to register a Branch Office.
Deciding on which setup is the most suitable for you may turn out easy when you are completely aware of the potentials of your products or services, the behavior of your market, your capabilities, your resources, and your short-term and long-term objectives, but the actual registration of your foreign company in Singapore a different story.
You still have requirements to prepare, local laws, and relevant business policies especially taxation to research, and other administrative responsibilities to perform.
Step #3 – Work with a competent corporate solutions provider
But making your next business adventure happen in Singapore should not be a burden.
The key is to hire qualified specialists who can make the entire process efficient and smooth for you.
√ Get in touch with a reliable consultancy firm
√ Discuss your plans with them
√ Furnish them the necessary requirements
√ Let them do the work they are good at as you focus on accomplishing yours
What’s stopping you?
Are you excited to expand your business operations in Singapore? What are the requirements or issues you are worried about?
Interested in starting your business in Singapore?
Richmond provides expert corporate solutions from Singapore company registration to corporate secretarial support to tax and accounting services. Let us assist you in your entrepreneurial journey.
