WHAT IS A NOMINEE DIRECTOR?
Typically appointed for matters related to privacy and legality, a nominee director (ND) is a legal entity that will be held responsible in cases where the company breaks the law. Given the responsibility and proper diligence to meet Singapore’s regulatory requirements, a ND also facilitates the completion of your company’s incorporation process.
The Singapore Companies Act requires all Singapore Private Limited Companies (PLCs) to have at least one director who is “ordinarily” a resident in Singapore.
Generally, an individual is qualified as a resident of Singapore if the individual:
- Provides a local residential address;
- Is a Singapore Citizen, Singapore Permanent Resident, Entrepreneur Pass holder, Employment Pass holder, or Dependant’s Pass holder; and
- Proves that he/she is long-staying (i.e., he/she can legally remain in Singapore for a long period).
*Please note that the above conditions are non-exhaustive as other factors may be taken into consideration.
WHY DO I NEED A NOMINEE DIRECTOR BASED IN SINGAPORE?
A Singapore citizen must act as a director of a registered company, presenting themselves as the face of the company. This is to prevent the abandonment of businesses in cases of law violations and to have someone be responsible for handling the statutory demands of persons and groups in the company. Basically, the director or nominee director ensures that everything is in line with Singapore law and fiduciary duties are honoured.
If you are a foreign investor looking to incorporate a private limited company in Singapore without establishing local residency, you might require the services of a nominee director. This also applies to those who do not hold an EntrePass work visa.
OUR NOMINEE DIRECTOR SERVICES IN SINGAPORE
At Margin Wheeler, we offer nominee director services for your business in Singapore. We understand the importance of appointing a competent and trustworthy professional to act as the local director of your company. If your company does not have a director who meets this requirement of the Singapore Companies Act, you can engage our Nominee Director Service. As a reputable corporate service provider, we will provide the local Nominee Director Service for your company, given the following conditions are met:
- The service is offered for statutory compliance only. The Nominee Director will not be involved in any financial or operational matters or management of the company.
- You must appoint one or more individuals (normally, company shareholders) to be the directors that are responsible for running the company operations.
- You must satisfy our initial and ongoing KYC requirements.
- The Nominee Director Indemnity Agreement is executed.
- You must subscribe to our annual secretarial service.
- You must subscribe to our accounting service.
- You must subscribe to our annual tax filing service.
- You must subscribe to our registered address service.
- You must subscribe to our payroll service for hiring employees in Singapore.
- You must redirect the Company’s bank statements to our Nominee Director’s office for monthly review.
- You are allowed to maintain only one Singapore Bank Account for the Company. The opening of a second bank account will be subject to our Nominee Director's approval, provided a valid reason is given.
- The opening of foreign bank accounts overseas is subject to Margin Wheeler’s approval.
Nominee Director Singapore: Questions
WHY IS SECURITY DEPOSIT REQUIRED?
US Sanctioned Countries
Please be informed that we will not be able to act as your company Nominee Director should you be a citizen of, have connections with, or be born in one of the countries under the US Sanctions list.
Should the aforementioned information be withheld and not disclosed to us, Margin Wheeler reserves the right to forfeit your deposit and strike off your company upon the discovery of such information.
Frequently Asked Questions About Director Services in Singapore
Local companies incorporated under the Companies Act should keep and be able to produce a register of its nominee directors and any other related documents to the Registrar, an ACRA officer, or public agency when required. This register should be kept in the company’s registered office, and should it not be available for inspection, under section 386AL(7) of the Companies Act, the company and every officer of the company can be fined up to $5,000.
There are a few locally incorporated companies that are exempted from maintaining a Register of Nominee Directors. These include:
- Singapore’s financial institutions
- Public companies whose shares are listed for quotation on an approved stock exchange in Singapore
- Companies wholly-owned by the Government in Singapore, a statutory body established by or under a Public Act
- Companies listed on foreign stock exchanges outside of Singapore and which is subject to regulatory disclosure requirements and those related to adequate transparency
The nominee director runs the risk of being taken to task should a company, or its other directors break the law. Therefore, it is imperative that he or she monitors the activities of the company closely to ensure that it complies with any regulatory requirements. In view of such liability, Margin Wheeler conducts a comprehensive KYC review before entering into a nominee director service agreement with companies.
No, the Nominee Director cannot manage and be involved in your company’s operations.
As an exception, the Nominee Director can sign a contract or invoice if the document is deemed acceptable to us, for an additional fee.
Directors of the company are legally responsible and accountable for complying with the requirements of the Singapore Companies Act. Failure to adhere to the statutory compliance requirements is an offense and may result in fines or prosecution.
Our Nominee Director will not have any financial, management, or operational interest in the company.
The Nominee Director’s main role is limited to comply with the statutory requirement of having a local resident director for your Singapore company.
If the foreign client is no longer reachable, the Nominee Director will be required to bear the company liquidation charges.
The security deposit should not be confused with the service fee or any other fee. The security deposit is your money that is temporarily held in our custody for the duration that you engage our Nominee Director Service.
The security deposit will immediately be refunded to you upon the termination of our Nominee Director Service.
We understand that our competitors may not collect a security deposit, but it should be noted that these companies may outsource their Nominee Director services. In the long run, the risk may be higher (e.g. Nominee Director may stop providing service and is nowhere to be found).
The extra security deposit is required as there are additional responsibilities for the Nominee Director to bear when the Company is GST registered or hiring local employees.
GST registered businesses are required to pay the GST one month after the end of the accounting period covered by the return. If the tax is not paid or is paid late, penalties will be imposed.
Additionally, employers who do not pay, underpay, or are late in contributing to their employees’ Central Provident Fund (CPF) accounts may face stiffer penalties, including being jailed.
The additional security deposit levies act as a safeguard for the Nominee Director should such situations come to pass.
Yes, you can terminate the Nominee Director Service anytime by providing us with the details of an alternate local resident director.
Engage Our Service
Nominee Director Service with a competent and trustworthy professional at only S$2,400/year.
*Additional fees may apply depending on industry and risk level.
A security deposit of S$2,000 is required - fully refundable upon termination of the service.
Lead Time For Service
Case-by-Case Basis - Every Nominee Director customer is different. Let's talk!
Compliance with Local Laws
Why do you need a Corporate Secretary?
Section 171 of the Singapore Companies Act, Chapter 50 requires ALL Singapore Companies to appoint a Singapore Company Secretary to handle on-going statutory compliance matters.