Start a Singapore Shipping Company
How to Start a Singapore Shipping Company
What Is a Shipping Company?
A shipping company ships things for trading companies. They will receive and do an inventory of the cargo, checking the quantity and condition of the items and making any special arrangements if necessary, like providing chilling facilities for perishable food items. The shipping company is responsible for the cargo until it reaches its destination, or, depending on the contract, until the owner takes possession of the goods. To summarize, shipping companies arrange all aspects of the cargo’s transportation by sea, from the seller, to the buyer.
Are There Any Perks to Starting a Shipping Company in Singapore?
Singapore is a big player in the import/export trade market – with its strategic position in Southeast Asia, many see it as connecting both the eastern and western hemispheres in terms of trade. This dominance is clearly reflected in Singapore’s many state-of-the-art import/export services and procedures, as well as its connections to hundreds of ports all around the world. Throw in the fact that there are over 5000 shipping companies, and the shipping industry contributes 7% of the island-state’s GDP, and you’ll have very good reasons why Singapore is one of the world’s leading International Maritime Center. And all this makes it the perfect place for a new shipping company to grow and prosper.
What Do I First Need to Do to Start a Shipping Company in Singapore?
The first step towards conducting business as a trading company in Singapore is to incorporate a company.(More about Registering a Company here.)
Once you’re done with incorporating your business, it’s time to head out and find suitable premises. There are a variety of rental options in Singapore; just find the one that best suits your shipping business’ needs and budget.
The next step then is to consider hiring employees, for working onboard your vessel, and/or for working in your shipping company’s office. For both of these cases, you’ll need to be in compliance with certain legislations. Those employees that you hire to work onboard your vessel will need to hold a valid Port Limit Manning License (please see below for more details). If you wish to hire employees for your shipping company’s office, you will need to ensure that you follow the hiring guidelines; if you do hire foreign staff, you’ll have secure the appropriate work permit.
If you’re starting a shipping company in Singapore, there are a couple of licenses and permits that you’ll need to hold before you can begin operations. Just which licenses or permits you’ll need depends on the structure of your business operations. Here are a few basic licenses and permits you might need:
- Harbor Craft License – You’ll need this to operate vessels within Singapore’s port.
- Port Clearance Certificate – This one is for operating vessels beyond Singapore’s port.
- Port Limit Manning License – Your crew members will need this license to work onboard your ships and vessels.
- Ship Registration Certificate – A must have for transporting either passengers or goods.
- Launch a New Vessel Permit – Get this if you intend to launch a new vessel that’s more than 15 meters in length in Singapore’s port.
- Permit to discharge/load/transit dangerous goods – and the permit to dock vessels carrying those dangerous goods.
- Ship Sanitation Control Certificate – You’ll need this certificate in order to certify that you vessel is in good sanitary condition for the transporting of goods.
- Ship Station License – A must have for operating radio-communication equipment onboard your Singapore-registered ship.
Which stage of business is this at?
Other licenses and permits
We’ll now be looking at these licenses and permit in depth:
Harbor Craft License
The Harbor Craft License is issued by the Maritime and Port Authority of Singapore. You must hold this license if you intend to operate vessels for the use of commercial purposes within Singapore’s port. There are several categories of Harbor Craft Licenses; this is based on the type of vessel as well as the purpose it is used for. There are various categories for this license: tankers, ferries, barges, cruise ships, etc.”]
- Fill in and submit a completed application form to the Maritime and Port Authority of Singapore (commonly abbreviated to MPA). You can make your submission at the MPA’s One-Stop Document Center, from Monday’s to Fridays, during normal business hours. Along with your application form, you’ll need to submit originals and copies of the following documents:
- A National Registration Identity Card, commonly referred to as an NRIC. The applicant’s NRIC will be required so that the license holds his/her name.
- A Certificate of Registration from ACRA (Accounting and Corporate Regulatory Authority). This will be requires for licensing in the name of a corporate body.
- Documents that show Proof of ownership of the vessel – Charter Agreement, Bill of Sale, Builder’s Certificate, Hull Receipt or invoice, etc.
- Document that show Proof of origin of the vessel – Launching Permit, Import Permit, etc.
- MPA Manning License, for the craft’s manning. For details on this license, please refer below.
- Documents for your Marine Insurance Policy, which covers third party liabilities, including personal/passenger injuries and wreck removal.
- Letter of approval to use the pier/landing place, where applicable. This would be issued by the owner who provides the facilities.
- The Port Master might requirement other documents. You should supply them as needed.
Arrange for Vessel Inspection:
To get a Harbor Craft License, the vessel for which the license is for must pass an inspection. You’ll have to make arrangements with the MPA’s One-Stop Document Centre in person, and you’ll have to do this at the very least one week in advance. At this stage, you won’t need to make a payment for the inspection.
Pay Fees and Receive License:
If the vessel passes the MPA’s inspection, you’ll receive the Craft Inspection Report. Within 7 days of receiving it, you’ll need to pay the necessary fees and all dues payable. Head on over to the MPA website to have a look at the fees and dues payable for the licensing of a harbor craft. After you’ve paid for everything, you’ll receive the Harbor Craft License certificate, which specifies the craft license number. The Harbor Craft License has to be displayed in a conspicuous place on board the vessel at all times; the license number cannot be obscured and has to be visible as well, at all times.
Port Clearance Certificate for those vessel departing FROM Singapore
The Harbor Craft License mentioned above is issued by the Maritime and Port Authority (MPA) for the use of the vessel withinSingapore’s port limits. If you intend for your vessel to depart from port limits, you’re going to need a Port Clearance Certificate from the MPA.
In order to ensure that you comply with Port clearance procedure, you’ll have to declare your vessel’s departure from Singapore. To do this, you’ll have to head on over to the MPA’s One Stop Document Center and submit a completed general declaration form, along with any necessary supporting documents.
The MPA will then arrange for an inspection. Once the inspection is done, you’ll have to pay port dues. After that, you’ll be issued with a Port Clearance Certificate. Upon getting this Port Clearance Certificate, your vessel will then have 48 hours to depart from Singapore.
Note: Please go to the MPA website to get a detailed explanation regarding documentation and port dues.
Port Clearance Certificate for those vessel arriving into Singapore
If your vessel arrives in Singapore, you have 24 hours upon arrival to make a declaration. In order to make this declaration, you’ll have to head on over to the MPA’s One Stop Document Center, fill in and submit a general declaration form, along with the any necessary supporting document:
- The Original Port Clearance of the vessel’s last port of call.
- IMO Certificate of Fitness for the transportation of LNG/LPG, as well as other dangerous chemicals in bulk.
- Certificate of Insurance, for the Civil Liability for Oil Pollution Damage (only if applicable).
The MPA will then allow a GDV Number (General Declaration of Vessel Number) and stamp this number on every copy of the General Declaration. The MPA keeps the original copy for the vessel’s arrival.
Note: Please go to the MPA website to see how you can use the EPC (Electronic Port Clearance) scheme to complete all formalities related to port clearances.
Port Limit Manning License
Every crew member onboard your vessel must hold a valid Port Limited Manning License. There are several different categories of Manning Licenses for the different types of crew member you have onboard.
What you’ll need to do is to visit the MPA’s One Stop Document Center, and complete a Port Limit Manning License Application Form for each of your crew members, and submit the form along with any of the crew member’s supporting documents, such as:
- National Registration Identity Card (if they are locals) or their Passports (if they are foreigners)
- Certificate of Competency or the Result Slip from MPA’s Maritime and Port Training Section.
- Certificates from any relevant courses attended.
- Work Permits or Employment Passes if the crew member is a foreigner.
The Port Limit Manning license is valid for 5 years and costs SGD 10. The MPA will issue the License once is processes the application form, supporting documents and the SGD 10 fee.
Note: Please go to the MPA website to see what the minimum manning requirements Singapore registered ships will have to be in compliance with.
Ship Registration Certificate
If you have a ship, you’ll have to register it. Foreign ships can be registered under a “foreign flag” while local ships can be registered under the “Singapore flag”. With the Singapore Registry of Ships (SRS), any type of ship can be registered under the Singapore flag.
How to register ships with the SRS:
First, you’ll have to satisfy certain pre-requisites before you can register your ship in Singapore.
1.You can only be registered as the owner of a Singaporean vessel if you are (1) A Singaporean Citizen or Singaporean Permanent Resident; or (2) A company that is incorporated in Singapore (see next point).
2.A Singapore incorporated company that is foreign-owned, meaning that foreigners own more than 50% of its equity, can only register its vessel as a Singapore vessel if:
o It has a minimum paid-up capital of SGD 50,000.
o The vessel in question weighs at least 1,600 GT (gross tonnage).
o The vessel in question is also self-propelled.
o Exemptions on the minimum paid-up capital and gross tonnage requirements are sometimes granted, but it would be on case-by-case basis, subject to a number of condition, and totally at the discretion of the SRS.
3.A Singapore incorporate company that is locally-owned, meaning that local Singaporeans own more than 50% of its equity, can register its vessel as a Singapore vessel if it the company in question fulfills the minimum paid-up capital requirement.
4.It should be note that that, usually, only ships less than 17 years of age will be considered for SRS Registration.
Second, once you’ve satisfied the pre-requisites mentioned above, you’ll have to write in to the Registrar of Ships, seeking approval of the name of your vessel, as well as for an application to request for an official number for your vessel.
Third, you’ll have to submit the application form, along with any supporting documents. When applying, you can choose between a provisional registration (valid for up to a year) and a permanent registration. These are some of the documents you’ll need to submit for a valid application:
1.A Completed Registration Application Form.
2.An ‘Appointment of manager form’. This is needed because it appoints a particular vessel manager, one that would be responsible for the operations of the vessel.
3.An ‘Appointment Agent Form’. You’ll need to submit this supporting document only if the person signing the application form is not the Director/Secretary of the company.
4.Here are just some of the supporting documents you need to submit along with the application:
o Business Profile printout, same as the one you lodge with ACRA.
o Documents showing proof of ownership – so this would be like a bill of sale or a copy of builder certificate.
o The vessel classification certificate.
o The value of vessel, in Singaporean Dollars.
o Certificate of the vessel’s tonnage.
o You might also have to present other statutory certificates.
Fourth, once you’ve submitted your application, you’ll need to pay the initial registration fee and annual tonnage tax. The Registrar will then go through your documents, and if everything is in order, will issue you with a Certificate of Registry. A Carving and Marking Note will also be issued to you.
Launch a New Vessel Permit
If you’re going to be launching a new vessel that’s more than 15 meters in length, you’ll need the Port Master’s written permission. You’ll have submit two copies of a completed, signed and stamped ‘Permission to Launch a Newly Constructed Vessel into the Waters of the Port form’ to the MPA’s One Stop Document Center; you’ll have to submit this 3 working days before the launch of your vessel. You’ll only be able to launch your new vessel in Singapore’s port when you are issued the Permit.
Dangerous Goods Permit
Vessels which are arriving in Singapore and transporting dangerous goods, petroleum or explosives or who plan to load these items in port, have to obtain permission from the Port Master. This also applies to you if you intention is to discharge these goods in the port.
You’ll have to notify the Port Master of all of this at the very least 12 hours before the vessel arrives in Singapore. You can do this by submitting a completed notification form to MPA’s Hazardous Cargo Section.
If tankers and conventional vessels that carry bulk liquid cargo with to dock at approved wharves, they’ll need to fill in and complete an application form in order to do that. This application form will then be submitted to the Port Marine Safety Department.
Ship Sanitation Control Certificate
It is this guide’s suggestion that you obtain a Ship Sanitation Control Certificate to certify that your craft is in a safe and sanitary condition, and is thus fit for transporting goods.
This certificate is issued by the NEA’s (National Environment Agency) Port Health Office. You can fill in an application form online, at the NEA website. You’ll have to pay a license fee as well, and this can range between SGD 170 and SGD 230, with the figure payable depending on your vessel’s gross tonnage.
Once you’ve submitted your application and the fee payment to the NEA, you’ll be issue with the Ship Sanitation Control Certificate within one business day.
Ship Station License
You’ll need this license if it’s your intention to operate any radio-communication equipment onboard your Singapore-registered ship. The Ship Station License can be obtained from the IDA (Infocomm Development Authority) of Singapore.
You can submit the required application form by going to the IDA’s website and using their Telecom Licensing System. For the application process, you also have to submit certain supporting documents, such as:
- MPA Harbor Craft License or Certificate of Registry
- Radio Operator’s Certificate of Competency (only if applicable)
- Safety Radio Certificate (only if applicable)
Besides the supporting documents mentioned above, you’ll need to pay a license fee as well. This fee is SGD 100 for each Ship Station License. The IDA will then take about 7 business days to go through and approve your application, and, finally, issuing the Ship Station License to you, completely valid for a period of 5 years.
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Paul Hype Page & Co. is an ACRA-certified business adviser. Our team of seasoned professional can help you set up a company in Singapore very quickly and easily following all legal entities, and offer you sound advice on how to make it successful too.
In addition to business registration, we’ll also guide you how to:
- Write a business plan – Learn how to write a compelling business plan by accessing our sample business plans, or other helpful market research information
- Perform market research – Understand your business market, learn how it can enhance your business growth, and how to properly conduct a market research for your business
- Corporate Secretary Services – If you are registering a company in Singapore, you will need a Corporate Secretary. Corporate compliance in Singapore is a complex legal requirement for all Singapore registered companies. Our company secretarial team helps our clients and their officers to fulfil their statutory obligations in an efficient manner.
- Manage your finances – We’ll offer you the best resources and information to help you fully understand all financial concepts and teach you how to perform basic accounting tasks like budgeting, bookkeeping, financial analysis, among others
To further aid you, we have provided here a resource area with industry specific information and other industry resources to help you successfully start and run your business.
- Singapore Business Opportunities
- Singapore Business Licences
- Singapore Tax Planning
- Singapore Company Incorporation
- Singapore Company Yearly Statutory Requirements
- Singapore Working Visa Guide
By Eric Eio
Managing Partner of Paul Hype Page & Co.
Eric was awarded an ACCA graduate in 2000 and also graduated from University of Sydney with a Bachelor degree in Computer Science & Accounting. Since graduation, he had worked in Big 4 as an auditor , including a one year overseas stint with Ernst & Young, Shanghai in 2005. He left his last appointment as an Audit Managerial position with PricewaterhouseCoopers, Singapore in 2008 before setting up his own Certified Public Accountant Practice – Paul Hype Page & Co. His firm is being selected to be one of the advisory panel for Singapore top 500 SME.