What is a Company?
A company is an incorporated entity and once registered
under the Companies Act, Chapter 50, it has legal
personality. It is different from a business firm and
usually has the words 'Pte Ltd' (Private Limited) or 'Ltd'(limited)
as part of its name.
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Types of Companies
Private Limited Companies :
Number of
shareholders is limited to 50 or less.
Public
Companies :
Number of shareholders can be more than 50 members and the
company may raise capital by offering shares and debentures
to the public. A public company must register a prospectus
with the Registrar before making any public offer of shares
and debentures.
Branches of
Foreign Companies :
These are companies whose country of origin are outside
Singapore and who wish to set up a branch in Singapore. The
companies are registered and not incorporated under the
Companies Act, Chapter 50.
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What is a Business Firm?
A business firm is either a sole-proprietorship or a
partnership. Individuals and companies, being "legal
persons", may set up and own a business firm. However, a
business firm, not being a legal entity, cannot register
another business firm.
Individuals and companies registering business firms need
not be Singaporeans or incorporated in Singapore. But in all
cases, the manager of a business firm must be a Singaporean,
Singapore Permanent Resident, Singapore Employment Pass
Holder or Dependant's Pass Holder.
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Sole-proprietorship
A sole-proprietorship is a business firm owned by one
person or one locally incorporated company. There are no
partners. The sole-proprietor has absolute say in the
running of the business firm.
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Partnership
A partnership is made up of more than one person or company.
Generally, all partners have equal rights in the management
of the partnership. To avoid possible disputes, it is
preferable that a partnership agreement is drawn up.
Partnerships may have between two and twenty partners. Once
there are more than twenty partners, the business entity
must be registered as a company under the Companies Act.
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What is the organizational structure of a Private Limited
Company's
The organizational structure of a Private Limited relies on
three basic groups: shareholders, directors and officers.
A Private Limited is owned by shareholders; however, they do
not directly manage the Private Limited. Instead, they
influence corporate decisions through indirect methods such
as electing and removing directors, approving or
disapproving amendments to the articles of incorporation and
voting on major corporate issues.
The board of directors are responsible for managing the
affairs of the Private Limited. Usually, directors make only
the major business decisions and supervise and appoint the
officers who make the day-to-day business decisions of the
corporation.
Officers are responsible for the everyday management of the
Private Limited. Typically, officers are appointed directly
by the board of directors.
It is important to note that a shareholder may serve on the
board of directors and as an officer .
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Can you comment on limited liability practices in Singapore?
Corporations (including societies registered under the
Co-operative Societies Act) are the only limited liability
entities in Singapore. A Private Limited is a legal entity
that exists separately from its owners.
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Can a company register a sole proprietorship? If so, what is
the liability? What about directors?
Yes,
a company can register a sole-proprietorship (RCB may
require a local manager to be appointed. As with all other
unincorporated entities, liability of the
sole-proprietorship is unlimited. Directors of the
owner-company may, in certain circumstances, be rendered
liable for the business, as the Business Registration Act
includes directors in the definition of persons who are
responsible for the management of the business.
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Must the
names describe the businesses?
There
is no legal requirement as such. However, descriptive names
are to be used if it would make the business name distinct
from those of other entities for the purposes of making an
application for the registration of a business name.
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We understand that for incorporation of companies, the date
of incorporation will be one day after the documents are
lodged. Please explain whether the same policy is applied
for business registrations? Can we request for a special
date?
The Certificate of Registration will be dated the date when
the application is submitted on line and is approved by the
RCB and the necessary payment made.
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There exists ABC Pte Ltd. Can a person, who is also a
director of ABC Pte Ltd, register a business name known as
ABC?
No, the names are considered identical. From the example, if
ABC Pte Ltd wishes to register ABC Trading,
this would be allowed provided the
name does not fall foul of section 11 of the Business
Registration Act and ABC Pte Ltd provides a letter of
consent for the use of the name "ABC".
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Can we handle incorporation of companies, registration of
business & corporate secretarial services in HDB flats?
Business activities may be conducted in HDB flats, if the
business qualifies under the Technopreneur Home Office
Scheme. Please contact the National & Technology Board (NSTB)
(hotline: 779 7066) for more details on eligibility, or
visit their website
www.nstb.gov.sg
for more information.
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Societies & Clubs (non- profit organizations) - who do they
register with?
The Registry of Societies.
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If the sole-proprietor intends to use the business name for
a Private Limited company, when should the date of cessation
be? Should the Form D be dated on the date when we submit
the incorporation documents?
There is no objection to the business firm being
terminated within 3 months of the date of incorporation. If
the business owner wishes to extend the date of termination
beyond the 3 month period, he/she must submit the request in
writing to RCB citing the reason(s) for the extension.
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Can I use a name which is similar to a company or trademark?
A proposed company name will not be approved if it is
identical to, or so nearly resembles the name of another
company, foreign company or business firm as to be mistaken
for it. Undesirable names, including offensive or vulgar
names will also not be approved. It is possible that the
name you select will not be distinguishable; therefore, we
ask for a second choice on the incorporation order form.
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Do I need to get approval from various government bodies for
regulated business activities?
The RCB controls the registration of business firms and
incorporation of companies. However, the nature of the
actual business activity could be subjected to control and
regulation by other Government authorities. Even if your
business firm has been registered, you cannot begin to
operate unless you have the necessary approval or license
from the relevant Government authorities approved When an
application has been referred to another authority, it may
take another 7 days to 2 months. click here for more info:
http://ferrari.nmi.net.sg/gsd3/owa/gsdsearch.search_check
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How
long does it take to process and approve a company's name
application?
The RCB immediately approves an application of name unless
the business activities need approval from a particular
government agency or it is a conversion from a business
entity where a letter of consent has to be attached.
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What is the minimum Authorized Capital for a Private Limited.
The minimum authorized share capital of S$100,000.00.
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What is the difference Authorized Capital and Paid up/Issued
Share Capital?
The total number of un-issued shares is defined as
Authorized Share Capital. Issued and Paid Up Shares are
shares that are issued and paid up. The minimum paid up
capital required in a Pte Ltd Company is S$2.00.
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How many director must a company's have in order to
incorporate?
Every company must have at least 2 directors one of whom
must be locally resident ie Singapore citizen, Singapore
Permanent Resident, Singapore Employment Pass or Dependent
Pass Holder.
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Will I be assured of getting an employment pass if I intend
to incorporate a pte ltd company in Singapore?
With effect from 21 June 1999, a foreigner intending to be a
local director need not produce his Employment Pass at the
point of registration of the business. Instead, he is merely
required to produce an Approval-in-Principle Employment Pass
(or "AIP EP") from the Employment Pass Department (EPD),
Ministry of Manpower. Application forms can be obtained at
RCB or at EPD. Please refer to the procedure for application
of an employment pass by a foreigner who wishes to act as a
local director of a new company.
Click
here for the procedure for application of an
employment pass by a foreigner who wishes to act as a local
director of a company.
Businesses planning to bring in foreign equity should advise
their foreign parties that foreign equity alone does not
confer the latter automatic rights to carry on business in
Singapore. Under the Singapore Immigration Regulations, any
foreigner who is not a Singapore permanent resident and
wishes to engage in any business, profession, occupation or
any form of paid employment in Singapore with a minimum
monthly income of S$2,500 is required to apply for an
Employment Pass.
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