In Singapore, nominee shareholders can be appointed with the purpose of formally stepping in the role of the rightful shareholder in a local company. They are recognized by the Company Act, which stipulates that the position can be held by natural persons or corporate entities that reside, respectively are registered in Singapore.
Enterprises can use nominee shareholder services, which is why if you want to set up a company in Singapore and want such solutions, you turn your focus on the solutions offered by our agents.
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Shareholders in Singapore
According to the Singapore Company Law, every company must have at least one or two shareholders depending on the type of entity. The shareholder must be a Singapore citizen or have a residence permit. However, the legislation also allows foreign investors setting up a company in Singapore to appoint nominee shareholders who will act on their behalf. The nominee shareholder must appear in the Singapore Accounting and Corporate Regulatory Authority’s records and thus protecting the real owner’s identity.
| Quick Facts | |
|---|---|
| Possibility to appoint nominee shareholders in Singapore (YES/NO) | Yes, the Company Act recognizes nominee shareholders. |
Recognition of nominee shareholders under the Singaporean law | Yes, the Company Act recognizes nominee shareholders. |
Definition | A nominee shareholder is a person or company holding shares in a company on behalf of a beneficial owner. |
| When can such a nominee be appointed? | When the beneficial owner does not want to disclose his/her identity to the general public. |
| How can nominee shareholders be appointed? | Nominee shareholders are appointed through a services contract or nominee agreement. |
| Requirement to register nominee shareholders with ACRA (YES/NO) | Yes. |
| ACRA notification requirements (if any) | ACRA must be informed about the appointment of the nominee shareholder within 30 or 60 days from the nomination, depending on the date of incorporation of the company. |
| Details of the nominees that need to be recorded with ACRA | – names, – local addresses, – nationality, – identification document number and date of birth in the case of natural persons, – appointment date. |
| Who can provide nominee shareholder services in Singapore? | – specialized agents and companies, – lawyers. |
| When can a nominee shareholder be appointed? | Before or after the Singapore company is registered. |
| Requirement for companies to keep nominee shareholder registers (YES/NO) | Yes, Singapore companies must keep such registers. |
| Exceptions from the nominee shareholder register maintenance (YES/NO) | Yes, for certain companies, among which public entities and financial businesses. |
| Requirement to disclose information about the nominee shareholders | Only with ACRA and other governmental organizations. |
| Period of nomination | There is no specific period for which such an agent can be appointed, as such companies will agree with the nominee on the time |
| Availability of nominee shareholders with our local agents (YES/NO) | Yes, you can rely on our Singapore agents for such services. |
If you want to open a company in Singapore and need nominee shareholder services, you can rely on our local consultants in company formation.
Appointing nominee shareholders in Singapore
In the process of company registration in Singapore, the nominee shareholder must be appointed during the document drafting stage, which is one of the first steps. This happens because the name of the nominee shareholder will be listed in the shareholder information section of the incorporation documents.
The beneficial owner’s name, address, and the number and value of shares allotted to the nominee for the necessary papers are required to register a nominee shareholder.
The Singapore nominee shareholder is selected in order to protect the beneficial shareholder’s identity from the public. However, in order to update ACRA’s records with the new shareholder information, the nominee must submit an annual return. Updates to internal corporate changes are also required by law.
An important aspect to consider is that the nominee shareholder is not involved in the decision-making process of the company.
If you are interested in setting up a company in Singapore and need information about the appointment of nominee shareholders, you can address our specialists.
Who can take on the role of a nominee shareholder?
A nominee shareholder can be:
- a corporate entity;
- an individual authorized by the shareowner.
Individuals can be Singapore citizens, but those holding:
- employment passes;
- permanent resident employment permits;
- dependent passes.
Under Singapore law, nominating a company shareholder is legal when the arrangement has legitimate reasons. Nominee shareholders can be family members, friends, accountants, or lawyers.
Even if family and friends can be appointed, most foreign entrepreneurs who open companies in Singapore choose professional services in this sense. Such solutions are also available from our company formation consultants.
What is the role of the Singapore nominee shareholder?
The nominee shareholder will be entrusted to hold the shares on behalf of the company’s owner, also known as the beneficial owner. The nominee shareholder can be a private or a corporate entity and will sign an agreement attesting that they will hold the shares in the company and will return them or transfer them anytime. Nominee shareholders in Singapore are usually employed to maintain full privacy by the company’s owners and are required to act only as instructed by the beneficial owners. However, they have no access to the company’s bank accounts and cannot make any payments on behalf of the company.
If you need more information about the role and the duties of nominee shareholders, you can refer to our specialists in company formation. In case you need assistance in order to open a company in Singapore, our team is at your disposal.
Here is also an infographic on this subject:
The nominee agreement in Singapore
When appointing a nominee shareholder, the owner of the shares will also draft a declaration of trust, also known as a nominee agreement which will be signed by both parties. Through the declaration, the nominee shareholder will acknowledge they have no right over the shares and that will transfer them whenever requested. Nominee shareholders in Singapore will also sign an instrument of transfer. These types of documents are usually undated.
New changes in the legislation for 2022
Companies registered in Singapore and abroad are required to maintain a public record of members. Starting with October 2022, the Company Act was amended to require nominee shareholders to notify the company or foreign company of their nominee status and the details of the nominator if they are holding shares of a Singapore business or a foreign company on behalf of another person. Subsequently, the company must create a Register of Nominee Shareholders.
There are also certain exemptions from this rule. They apply to:
- Singaporean financial institutions;
- corporations registered on the Singapore Exchange;
- Singapore companies and based abroad that are listed on a securities exchange.
If you want to set up a company in Singapore and need information on the latest changes in the legislation, do not hesitate to ask our agents.
Types of companies registered in Singapore
In 2020, the were 42,217 new companies registered in Singapore, according to data here. Based on ACRA’s records, here are some statistics on the number of legal entities operating in Singapore in October 2022:
- 144,138 sole proprietorships and partnerships;
- 617 limited partnerships;
- 403,572 private and public companies;
- 686 companies with variable capital;
- the total number of companies registered until this moment of the year was 566,527;
- out of these, 5,112 were registered during the first 10 months of this year.
Our Singapore company formation representatives offer a wide variety of services, among which nominee shareholders services. For complete information about the legal requirements for appointing a nominee shareholder, please contact our experts in opening companies Singapore.