Singapore Company Incorporation with Paul Hype Page
Company Registration at Paul Hype Page Singapore

A Singapore nominee director must either be a Singapore citizen or a foreign individual who is a permanent resident. The Singapore Companies Act requires all companies in Singapore have either a director or a nominee director.

A foreign individual who is planning to launch a new business in Singapore but does not have the required visa to do so needs to initiate the registration of the Singapore company with a nominee director.

All companies in Singapore must be registered with the Accounting and Corporate Regulatory Authority (ACRA) and abide by the statutory compliance requirements for registration of a company in Singapore.

These requirements include the following :

  • initial paid-up share capital of at least S$1
  • a physical Singapore office address
  • at least one shareholder (individual or corporate entity)
  • at least one resident director
  • at least one company secretary
requirement to register a SG company

Anyone who is neither a Singapore permanent resident nor a valid pass holder will need a resident director before the company can be incorporated.

If you do not have a resident director for your company, you may use the services of Paul Hype Page & Co to find such a person. We will assist in providing you with a reliable individual while applying for an Employment Pass for you to allow you to become your company’s director at the same time.

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Risks of Using Nominee Directors

Ideally, all nominee directors ought to be appointed through a legal written arrangement. This is to safeguard the well-being of the business owner and the status of the company as a legal entity.

The risk of failing to use proper documents to set up the arrangement is that damages which cannot be controlled may be incurred.

Other potential risks of using a nominee director include the following

  • The company owner damages the relationship with the nominee; this may sometimes end up with the nominee treating all shares received as a gift and therefore incorrectly claim entitlement as the real owner of the shares in the company
  • The nominee demands more payment
  • The nominee passes away or loses mental capacity and their next of kin refuses to recognize the arrangement and seeks to treat the shares as their right
  • The nominee becomes uncontactable
  • The nominee uses the shares as security for a personal loan, sells them, or takes the director’s service fee for personal use
  • The nominee discloses the arrangement to a third party

Hence, the importance of using well-written documents to record a nominee director arrangement cannot be overstated, given the risks highlighted above.

Reasons to Appoint a Nominee Director

There are various reasons for using a nominee director. Singapore company laws require foreign investors setting up companies in the Republic to appoint an ordinarily resident director and a resident company secretary.

The director must be a Singapore citizen, a permanent resident, or a holder of one of Singapore’s valid work permits. However, there are situations in which a foreign business cannot find a local partner.

If you do not have a nominee director, you may contact us at Paul Hype Page & Co. We have the expertise and resources to handle this situation in a professional, easy, and efficient manner. We will provide you with the best nominee director services that we have.

We will also ensure that the nominee director we select for your company has never violated the corporate laws of Singapore.

We will also ensure that the nominee director we select for your company has never violated the corporate laws of Singapore. Recently, several nominee directors have done so. Some of the offenses committed by such errant nominee directors include those which have implicated them for their role within a money-laundering network. This will never be the case for any of the nominee directors we will select for your company.

One of the primary advantages of this appointment is the privacy of the shareholder or the ‘actual’ director. The nominee director may proceed to set up the company’s bank account, complete the taxation registration, and obtain the required licenses for the purposes of business operations. This will save time for the owner who can now concentrate on growing the business. It will also save the owner much money.

The role of a nominee director is not illegal under Singapore law if it is used for legitimate reasons. The existence and identity of the company owner is recorded for the benefit of public agencies such as the Inland Revenue Authority of Singapore (IRAS) and ACRA.

ACRA states: “A director must make decisions objectively, act in the best interest of the company, avoid conflicts of interest, and be honest and diligent in carrying out his duties.”

Want to Start business in Singapore
Want to Start business in Singapore

Definition of a Resident Director in a Singapore

It is vital to understand that Singapore’s law does not recognize the difference between active, inactive, shadow, and sleeping directors.

According to the Singapore Companies Act, a director can be defined as “any person occupying the position of director of a corporation by whatever name called and includes a person in accordance with whose directions or instructions the directors of a corporation are accustomed to act and an alternate or substitute director”.

Hence, it is important to understand that even though a person is not formally appointed as a director, ACRA will still “recognize that person as a director if other directors of the company follow his instructions or if he is involved in the management of the company”.

However, the same person who has been appointed as the company director cannot also serve as the company secretary.

Role of a Nominee Director in a Singapore Company

In Singapore, a nominee director has the same obligations and responsibilities as those imposed on a regular director by the Companies Act and all abiding law in Singapore. However, a nominee director may not be named as the legal owner of a business.

Singapore Nominee Director FAQs

Can any Bank be used to Open a Corporate Bank Account?2020-07-01T15:48:20+08:00

There are no restrictions on which banks can be used to open a corporate bank account in Singapore. Thus, a company owner may select any bank for the opening of the corporate bank account. 

Can a Nominee Director be a Foreigner?2020-07-01T15:47:44+08:00

A nominee director is appointed to fulfill the requirement of at least one local director of a Singapore company. Therefore, a nominee director cannot be a foreigner.

Why is a Nominee Director’s position within a Company Limited?2020-07-01T15:46:47+08:00

A nominee director is not granted the same powers and privileges as those granted to a conventional director. A nominee director is only the director of the company in name. Therefore, it stands to reason that the nominee director’s position within the company ought to be limited. 

2021-01-27T16:13:22+08:00March 11, 2015|Comments Off on Singapore Nominee Director