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Setting Up a Singapore Branch Office

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Like subsidiary company, Branch office of the foreign company in Singapore is a registered as the legal entity and treated as an extension of the foreign company. Branch office is required for foreign companies wishing to setup their presence in Singapore. Because of some reasons the branch office registration is not so common among small to medium size foreign companies.
Singapore is one of the most developed and outward looking economies in the attractive Asian region. Many foreign companies are keen to invest in Singapore due to its highly liberalized business regime with government. Every year thousands of foreign companies are attracted to Singapore because of its proactive policies, stable and efficient government, along with its integral benefits as a progressive hub for many of the high growth sectors.

Singapore Branch - Type of Business Entity

Those activities that are making profit in Singapore are to be registered with the Accounting and Corporate Regulatory Authority (ACRA) of Singapore. Foreign company is the company that is incorporated outside Singapore. So before starting the business a foreign company must register an entity in Singapore.
Branch office is a legal entity registered with the company registrar in Singapore and it is considered as the extension of the foreign company and not as a separate legal entity. The parent company is totally liable for all the debts and liabilities of the branch office and a claimant can approach the Singapore courts of law to initiate legal proceeding against the headquarters, by virtue of its branch being located in the Singapore jurisdiction.

Basic Requirements for Setting Up a Singapore Branch

One should use the services of the professionals who wish to register a branch office in Singapore e.g. law firm, accounting firm, or corporate secretarial firm. Following are some of the basic requirements you should be ready with before registration of the branch office:
1) Name: The name of Singapore branch office is the same as the name of the foreign company.
2) Officers: Branch office must incorporate at least 2 agents who are the resident in Singapore, i.e. a Singapore citizen, a permanent resident, or a foreigner who has been issued an employment pass/dependent pass. The age of the agents should be above 18  years. Foreign companies are free to relocate any of the staff members from head office to Singapore but they have to apply for the employment pass after branch office registration.
3) Constitution and Activities: For theshareholders activities, Memorandum and Articles of Association (MAA) is issued. There is no separate MAA for the branch office.
4) Registered Address: For the branch office, a registered office is necessary for the branch office that is to be located in Singapore. According to the Singapore Companies Act, the branch office must mention its name and the place of incorporation on all its business correspondence and also outside its place of business in Singapore.

Documents Required
In general, the following documents/information is to be required for registering a Singapore branch office:
1) A certified copy of the Certificate of Incorporation of the foreign company.
2) A certified copy of Memorandum and Articles (MAA) of the foreign company.
3) Particulars of the directors of the foreign company.
4) A memorandum of appointment and details of at least two persons resident in Singapore who will act as the agents for the Singapore branch Office.
5) A memorandum executed by or on behalf of the foreign company stating the powers of the local agents.
6) Details of the registered office in Singapore.
7) Any documents not in English must be translated in English through official channels before submission.

Registration Procedure and Timeline

Now it becomes the duty of the professional firm that is hired by you, to handle the branch office necessary registration formalities. From the headquarters no personal visit of company executives is required. The registration process consists of two basic steps:

  1. Name approval
  2. Entity registration.

The name for the Singapore branch should be same as that of the parent company that’s why it will generally be approved unless it is identical to any existing company name or is vulgar in nature.
Generally 1-2 days are required for the registration of the Singapore branch by assuming that all the necessary document are ready and there are no delays in the name approval process.
As all the procedure of registration is computerized in Singapore so the company registrar will send an email notification confirming the registration of the Singapore branch and no hardcopy certificate is issued by the registrar, unless specially requested by the company through a separate application post registration of the entity. In Singapore the Email notification is sufficient for all business matters such as bank account opening, signing an office lease agreement, etc.

Bank Account Opening
After the registration of a Singapore branch, a corporate account can be opened in any of the several international and local banks in Singapore. Multiple account of various currencies or single multi currency account may be opened. Different procedures are there for different banks account and some banks require the directors or agents to be present in person while opening the account.

Taxation of Singapore Branch
From the taxation point of view the Singapore branch office is considered a non-resident company means these companies are not eligible for tax benefits resulting from available tax incentives and tax treaties meant for resident companies.
The foreign company is required to submit its annual report and the audited accounts within the two months of its Annual general meeting or within 7 months from the end of its financial year.

In order to have favorable environment to all the companies, the Singapore government continually reviews and renews the business legislations in order to adapt to the evolving needs and to be in tune with the international developments

 

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