How to Set Up a Foreign Company in Singapore
Setting Up a Representative Office
In most cases, the first step of the process of setting up a foreign company in Singapore is that of setting up a representative office there. An authorized representative office will be able to assist business owners with market research, compliance, and pricing schemes as well as other factors which are critical to the success of a business in Singapore. The Singapore representative office will be staffed by representative personnel of the business owner’s choice. Business owners may either select personnel who are either part of a local representative office or appoint one from the parent company if there is one.
Choosing a Business Structure
Foreigners entering Singapore for business purposes have three options from which they may use to establish a business in Singapore. They may set up a subsidiary company, set up a branch, or incorporate with a local company to facilitate their business activities.
Setting Up a Subsidiary
Foreign business owners who already have a foreign parent company are allowed to proceed with setting up a subsidiary company which is independent of the parent branch. This subsidiary company is to be treated in the same way as a local private limited liability company in Singapore. Such subsidiary companies are taxed in the same way as any local company is.
Setting Up a Branch
Foreign business owners who already own a parent company which is seeking to open a branch office in Singapore and have the branch office be dependent on the parent company could initiate the process by registering a branch. Those who choose this option will find that the parent company retains all liabilities and undertakings of the branch. At this point, the branch is not yet viewed as a separate legal entity from its parent. Nevertheless, the branch must still adhere to tax regulations as prescribed by Singaporean company laws for foreign companies. After setting up a branch, the owner might open subsidiary offices within Singapore for effective management.
Incorporating a Local Company
In the absence of a parent company, an entrepreneur may proceed to incorporate a local company as long as it has limited liability. This means that the company will operate as a locally incorporated company and enjoy the same benefits that Singapore companies do.
There are other less common business entities in Singapore. However, although they are less common, that does not make them unviable. One can open a business entity of any type as long as the business entity is approved by Singaporean authorities. Other business entities in Singapore include sole proprietorships, partnerships, and public or private limited companies.
If you have any interest in starting a company of any sort in Singapore, let us at Paul Hype Page & Co be the first to assist you in your endeavor. Our company incorporation experts will work with you throughout the entire process of company incorporation. Once you have worked with us, you will find that the process has been greatly simplified through the use of our services.
What Should Be Done After Starting a Singapore Company
Although Singapore is one of the world’s best locations for business activities, running a foreign company in Singapore is not as simple as some might automatically assume. The business environment, requirements, licenses, and business regulations might overwhelm new business owners during the first months or even years of operations.
Therefore, foreigners who have just set up a business in Singapore are recommended to hire a consultancy firm which would help them manage issues during the initial stages of business operation. Once the business owner believes that a full adjustment to the Singaporean business environment, the owner will no longer use consultancy services. It should be noted that the use of consultancy services is optional, not compulsory. Furthermore, hiring a consultancy firm will not affect the company’s profits. However, it will affect the business owner’s relations with Singapore’s business authorities.
How Foreign Companies Benefit Singapore’s Economy
Foreign investments account for foreign direct investments (FDIs) in an economy. FDIs make a country more likely to earn more revenue through taxes and other charges on foreign investment. Foreign companies therefore help to expand Singapore’s economy not only through revenue but also through products in the market. Due to the fact that many foreign companies have opted to invest in Singapore, the variety of goods and services is likely to increase, thus creating a competitive business environment.
Foreign investments also create employment opportunities for Singapore’s citizens. The establishment of foreign companies causes employment opportunities to open up. These employment opportunities could be taken by qualified locals. The increased employment opportunities will subsequently increase the living standards of people due to increased spending. Thus, foreign investments have positive ripple effects on the economy.
Business activities in Singapore are now leveraging on technology as a means of increasing the efficiency of production and improving the quality of products. The expectations of the market are therefore rising rapidly. This gives entrepreneurs less time to come up with innovative and creative products that may capture the attention of Singaporean consumers. Summits, exhibitions, conferences, and trade fairs are some of the places that investors could receive valuable investment information about the Singaporean market. Ultimately, prior to opening a business in Singapore, an entrepreneur must have conducted due diligence on not only the market climate but also the bureaucratic processes involved.