The incorporation of a private limited company in Singapore provides several benefits. Ownership of properties as well as the status of perpetual succession are some advantages which such business owners in Singapore may claim
One of the business entities which a business owner based in Singapore might choose to start is the private limited company. Private limited companies possess certain features which have caused them to become the most common business entity which is found in Singapore today. Thus, there are several circumstances in which it is advantageous for one to start a private limited company in Singapore. However, before that matter may be discussed, the private limited company itself must first be defined.
Definition of a Private Limited Company
A private limited company is a type business entity which is privately held. A private limited company restricts the liability of its owners to the value of the shares of the company which they one. The number of shareholders of a Singapore-based private limited company must be 50 or fewer. These shareholders are also forbidden from publicly trading their shares.
Features of Singapore Private Limited Companies
According to the corporate laws of Singapore, private limited companies are permitted to own properties. A private limited company may do so by claiming ownership after a sale has been made under its name. Should the properties have been acquired by the company through any other method, the private limited company is nevertheless entitled to ownership of the properties in question.
Private limited companies may also participate in legal and litigation proceedings. This fact allows a private limited company to sue or be sued itself in courts of law. A private limited company may choose to sue another entity for the purposes of prosecuting a claim or defending against any claim which any external party has filed against it.
Private limited companies also have the status of perpetual succession. Therefore, even when its shareholding structure changes or if any of its shareholders were to die, the company will continue to exist as if nothing out of the ordinary had happened. Thus, shares of a private limited company can easily be transferred in any given situation.
Circumstances in Which Starting a Private Limited Company Is Advantageous
When the features which are unique to private limited companies are considered, it becomes evident that there are certain circumstances in which a business owner is advised to start a private limited company in Singapore. One such circumstance takes place when the company requires properties of its own to carry out business operations. Due to the fact that a private limited company based in Singapore is allowed to own properties, business owners who require the ownership of additional properties ought to set up a private limited company. If the business is intended to be a long-term one which is expected to be in operation for an extended period of time, the private limited company is a suitable choice of business entity. This is because of the perpetual succession of private limited companies. This important characteristic enables private limited companies to exist for as long as is desired by its owners. Should a prospective business owner anticipate that a possible legal challenge will soon be experienced after incorporation of the company, it is advisable for such an owner to establish a private limited company because it is the only business entity which is allowed to participate in any legal proceedings. This will allow it to sue those who are believed to have infringed upon its legal rights as well as defend itself against any unjustified legal challenges.
It should now have become evident that there are many benefits to starting a private limited company in Singapore; indeed, perhaps you might have gained the desire to start one yourself after having read the preceding paragraphs. If such is true, allow us at Paul Hype Page & Co to be the first to assist you with the incorporation of your private limited company. We will handle all of the details which you might not be able to manage on your behalf. Through our assistance, your private limited company in Singapore will be established according to the country’s business laws and guidelines.