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Foreign Companies Requirement - Branch Office Setup

posted Oct 30, 2012, 6:20 AM by Fide Consultant Group   [ updated Oct 30, 2012, 6:21 AM ]
The information below provides a guide to the basics of registering and maintenance of a foreign company under the Companies Act (Cap 50). It should be read with the relevant legislation. Always seek legal advice if you are unsure of any matters.

A foreign company may carry on business in Singapore by incorporating a local company or registering as a foreign branch under the Companies Act. A branch is not a legal entity separate from the parent company. The parent company will not be liable for the debts of its foreign subsidiary. A branch is merely an extension of the parent company; it does not have its own shares or its own board of directors.

Foreign company’s duty and obligations as to:

(1) Registration as a branch;
     A foreign company has to register under the Companies Act if it establishes a place of business or commences to carry on business in Singapore

(2) Having at least 2 local agents;
    
The foreign company needs to appoint 2 or more persons resident in Singapore to be its agents and accept on its behalf service of process and notices required to be served on 
     the company. Being a local agent for a foreign company, he has to:

a) continue being an agent until ceasing to be one,
b) be answerable for the doing of all acts, matters and things as are required to be done by the foreign company under the Companies Act, and
c) be personally liable for all penalties imposed on the foreign company for any contravention of any provisions of the Companies Act unless he satisfies the court hearing the matter that he should be not so liable.


If default is made by any foreign company in complying with the Companies Act, the company and every officer of the company who is in default and the agent who knowingly and wilfully authorises or permits the default is liable to a fine and default penalty.

(3) Having a registered office in Singapore;
    
The foreign company’s registered office in Singapore must be open and accessible to the public not less than 5 hours each business day and to which all communications and
     notices may be addressed.

(4) Updating the Registrar;
     The Registrar is to be notified within one month, if there the following change or alteration occurs to:

(5) accounts; and
     The parent company's balance sheet must be lodged with ACRA within two months from the date of its annual general meeting. If the Registrar is of the opinion that the
     documents as filed does not sufficiently disclose the
company’s financial position, the Registrar may require another balance sheet containing such particulars as required, to be
     filed


     Where the parent company is not required by the law of the place of its incorporation or origin to hold an AGM and prepare a balance sheet, the parent company shall prepare
     and lodge with the Registrar a balance sheet within such period, in such form and containing such particulars and annex such documents as the directors of the company would
     have been required to prepare or obtain as if the company were a public company incorporated under the Singapore Companies Act.

     The foreign company is to lodge a duly audited statement showing the assets and liabilities arising out of the company’s operations in Singapore and a duly audited profit and loss
     account which, in so far as is practicable, complies with the requirements of the Singapore Accounting Standards.

(6) cessation of business in Singapore.



Requirement documents for registration:

(a) Certified copy of the certificate of its incorporation,
(b) Certified copy of its Memorandum and Articles of Association,
(c) List of directors,
(d) If the list of directors includes those resident in Singapore, a memorandum stating the powers of the local directors,
(e) Memorandum with particulars of 2 or more natural persons resident in Singapore authorised to receive service of process or notices (also known as the agents of the foreign company), and
(f) Registered office hours and situation.


For complete regulation, click here.


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