Set up a company in Singapore

Singapore is known as a “lion island nation” with a dynamic and open business environment that attracts investors because of its dynamic and transparent business environment. A stable legal system, modern infrastructure, preferential business support policies and a high-quality workforce are the factors that make the lion island nation particularly attractive. Set up a company in Singapore, businesses not only benefit from free trade agreements, but also have the opportunity to access a wide market, connect with an international business network, and effectively protect intellectual property rights. With these outstanding advantages, Singapore is indeed an ideal destination for businesses to establish and develop.

Choosing the type of company setting up in Singapore

Private Limited Company

• Characteristics: This is the most common form in which the liability of members (shareholders) is limited to the amount of capital contributed.
• Advantage:
  • Simple and fast establishment procedures
  • Flexibility in management and administration
  • Suitable for small and medium-sized businesses
• Shortcoming:
  • There are some restrictions on raising capital from the public

Sole Proprietorship

• Characteristics: The business belongs to a single owner, which can be an individual or a company.
• Advantage:
  • Simple incorporation procedures, low cost
  • Full authority to decide on business plans
• Shortcoming:
  • The owner is infinitely liable for all debts of the company
  • Difficulties in raising capital

Partnership

• Characteristics: There are at least two owners in the same business partnership.
• Advantage:
  • Flexibility in management
  • Easily raise capital from partners
• Shortcoming:
  • Partners are jointly responsible for the company’s debts

Registration for issuance of outward investment certificates

• Accordingly, Vietnamese investors register to invest abroad if the establishment of the company uses capital sources (money, machinery, value of intellectual property rights, property rights) transferred from Vietnam to Singapore.
• In Clause 13, Article 3 of the Law on Investment 2020, it is stipulated: “Outward investment activities are the transfer of investment capital from Vietnam to abroad, using the profits earned from this investment capital to carry out overseas business investment activities”
• Thus, if you use money and assets from Vietnam to invest in establishing a company in Singapore, you must carry out procedures for registering outward investment at the Ministry of Planning and Investment. If the investment capital in foreign currencies transferred to Singapore is equivalent to VND 20 billion or more, the Ministry will consult the State Bank.
• The time limit for issuance of outward investment certificates according to the Law is 15 working days, if the dossier is valid.

Dossier of registration for issuance of outward investment certificate

• Offshore investment registration form B.I.1 in Appendix B of Circular 25/2023/TT-BKHDT;
• Written commitment to arrange foreign currency;
• A document of the tax authority certifying the fulfillment of the tax payment obligation;
• Documents on the legal status of the investor;
• Documents proving the legal status of the overseas enterprise

Register for Forex Trading

After being granted an outward investment certificate or an overseas business license, the investor shall register foreign exchange transactions at the State Bank of Investor, investment capital, investment capital account opened at a licensed credit institution to carry out overseas investment activities and the progress of remittance of investment capital in cash abroad.

A dossier of registration for foreign exchange transactions related to outward investment activities includes:

• Application for foreign exchange trading related to outward investment activities.
• A copy of the outward investment certificate.
• A copy of a foreign language, a Vietnamese translation of the written approval or a business license or a document proving the right to conduct investment activities in the host country.
• The original of the written certification of the licensed credit institution on the opening of the investor’s investment capital account, clearly stating the account number and type of foreign currency.
• The original of the authorized credit institution’s written certification of the amount of money the investor has transferred abroad before being granted the outward investment registration certificate.
• Written explanation of the need for remittance of investment capital abroad in Vietnam dong in case of remittance of investment capital abroad in Vietnam dong.

Remittance of investment capital abroad

After completing the registration of foreign exchange transactions, the investor transfers the investment capital abroad according to the registered project schedule.

In case of change in capital transfer schedule, it must be registered with the competent State Bank.

To do business well and effectively as well as protect the rights & responsibilities of business people. Viet An Law provides legal basis, legal services to create the best legal basis for domestic and foreign businessmen. Contact us for further assistance.