Understanding the Legal Landscape : Consider These Issues Before Starting Your Business In Singapore

legal-issues

 

When deciding to start a business, there is a multitude of legal issues that you will have to consider beforehand. Everything from the name of your business to the creation and upkeep of your product is bound by legal statutes and limitations.  It might start to get tedious after a while but after you sift through the paperwork, the reward at the end will be your shiny, brand new company. The ThunderQuote team would like to help you figure out the logistics of starting your brand new company! 

 

Why Singapore you ask? Well it has a strategic location and its diverse cultures call for people of all walks of life to one day become potential customers. In addition to that, the legal system here is incredibly stable and it has a safe political climate which is a blessing given the current situation around the world. It is also an incredibly pro-business country. Our doors have always been open for any type of entrepreneurships.

So what are the legal issues that you would need to consider if you do decide to set up a business in Singapore? Here are a few tips to help guide you on this rewarding process :

#1 Determining What Type of Business You Want To Run

Before even beginning the process, you would need to determine the type of business you would like to form. In Singapore there are 5 business structures available for registration. The table below will explain the differences between all these structures. It must be known that all of this is governed under the Companies Act (Ch 50).

Type of Structure Features Who Can Register Cost/Time Frame
Sole Proprietorship -business owned by one person or one company.

-no partners & sole proprietor has absolute say in running of business

-must be 18 years and above.

-Singapore citizen/PR/EntrePass Holder

-If not resident, must appoint an authorised representative based in Singapore

-$115 ($15 name application fee and $100 registration fee) for 1-year registration

-$175 ($15 name application fee and $160 registration fee) for 3-year registration
Partnership -firm formed by 2 to 20 partners.

-if more than 20 partners, must register under Companies Act (Ch 50)

-must be 18 years and above.
-Singapore citizen/PR/EntrePass Holder
-If not resident, must appoint an authorised representative based in Singapore
-$115 ($15 name application fee and $100 registration fee) for 1-year registration


-$175 ($15 name application fee and $160 registration fee) for 3-year registration

Company -Has a legal entity

-’Pte Ltd’ and ‘Ltd’ usually part of the names

-three different types : Exempt Private Company, Private Company and Public Company

-At least one shareholder
-At least one director ordinarily resident in Singapore
-If a foreigner wishes to act as a local director of the company, he can apply for an EntrePass from the Ministry of Manpower
-$315 ($15 name application fee and $300 incorporation fee)
Limited Liability Partnership -Offers flexibility and operates as a partnership while having a separate legal entity like Private Limited Company -At least two partners or a body corporate (a company or other LLP)

-At least one manager ordinarily resident in Singapore

-$115 ($15 name application fee and $100 registration fee)
Limited Partnership -Similar to Limited Liability Partnership but it does NOT have a legal separate entity from its partners.

Note : During the registration of the LP, the lodger is required to indicate if the proposed LP falls under Regulation 12 of the LP Regulations.

-At least one general partner and limited partner.

-At least one manager ordinarily resident in Singapore

-$115 ($15 name application fee and $100 registration fee) for 1-year registration


-$175 ($15 name application fee and $160 registration fee) for 3-year registration

 


#2 Finding Premises

After figuring out what kind of business you are starting, the next chore on your list is to figure out where you are going to set up shop. To have you business properly registered, you need a real Singaporean address. This is crucial because all letters related to this business will be sent to the address you have provided. You must also make sure that you talk to the Urban Redevelopment Authority (URA) to seek approval to use these premises for commercial usage. If you are using your HDB flat or your landed property, make sure to comply with the Housing Development Board and Home Office Scheme regulations respectively.

#3 Business Licenses

Running a business demands everything to be properly licensed and registered. It’s true that you will get most of your licenses after registering your company with ACRA but it’s smart to obtain a lawyer or read up on all the preliminaries to ensure you do not get caught in loopholes that will cause you a lot of money and legal problems. If needed, you can refer to the LicenceOne website to find out about obtaining the necessary licenses for your company.

#4 Non-Disclosure Agreements and Intellectual Property

If you believe that your idea for your company is truly one of a kind, you might want to get it trademarked to make sure that the rights to distribute or use it remains with your company only. This would call for some knowledge in intellectual property law. But fret not! The Intellectual Property Office of Singapore has an amazing website that you can visit for everything you need to know about protecting those brilliant ideas.

Non-disclosure agreements (NDA) are also very important to make sure you business strategies do not get leaked and to also make sure that everyone you hire can be trustworthy by virtue of this agreement. It is just a blanket protection to make sure unnecessary problems don’t crop up from nowhere. You can choose to have a bilateral or unilateral NDA. Pick one that best suits your team of workers. This website is great help for extra reading.

#5 Hiring Workers and Worker Visas

If you are planning to hire workers for your new business, there are a few things that you need to comply with. The legal authority and main pieces of legislation that govern this area are the Employment Act which extends to both local and foreign workers as well as the Employment of Foreign Manpower Act (EFMA) for work pass employees. If you need more information, visit here for a more comprehensive breakdown on how to hire employees and comply with the legal requirements in Singapore.

If you feel you have everything ready and done, go ahead and register this business of yours. You can do it online on Bizfile or decide to entrust this matter to a private professional incorporation company. Good luck!

 

ThunderQuote is the most comprehensive business services portal in Singapore, Australia and ASEAN , where hundreds of thousands of dollars of procurement contracts are sourced every month by major companies like Singapore Press Holdings, National Trade Union Congress and more.

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