A company in Singapore has to officially appoint a company secretary within 6 months of its formation as mandated by the Accounting and Corporate Regulatory Authority (ACRA).
A company secretary is responsible for handling various important administrative tasks to ensure that the company follows the business regulations of Singapore.
It is, however, a major concern if the appointed company secretary fails to perform their duties and is unable to meet expectations.
Often the negligence of a company secretary can make the matter worse, like getting penalized for non-compliance. In such cases, the change of company secretary is on the cards.
This article will guide you on how to change your corporate secretary.
Why Сhange Corporate Secretary?
When the authorities in a company authority notice some tell-tale signs that the company secretary is not performing his/her duties the right way, they can release the person from that position.
Now, before we talk about how to change company secretary, let us see the red flags that can force a company to replace its company secretary:
- The response time of the company secretary is quite long, and it even takes days to get back with urgent company matters.
- Frequent follow-ups have become a norm after assigning a task.
- The company secretary was unavailable at times even during important matters.
- Important documentation is not done on time.
- Failure to remind directors about crucial deadlines for annual financial statements.
- Ineffective advice and guidance on compliance with regulatory matters.
- Late actions resulting in penalties.
- The salary paid is unjustified compared to the performance of the company secretary.
All the reasons listed above are enough to change your corporate secretary in Singapore.
When Should You Change Corporate Secretary?
It is ideal to replace your company secretary only after any major filing deadline that is around the corner.
If the company secretary realises the possibility of losing the job, there could be delays in meeting filing deadlines due to reluctance or negligence. It could lead to unnecessary stress and even attract penalties.
Usually, the termination of an existing secretary and the appointment of a new secretary happen simultaneously.
It is important to keep in mind that you cannot leave the position of the company secretary vacant for more than 30 days at any point. If a company fails to follow this rule, there could be a penalty or prosecution according to the Companies Act.
What Is the Resignation Procedure Like?
If the separation of the company secretary is mutually agreed upon, then the process will be easier.
When the company secretary in a company agrees to resign, the company only needs a few documents to implement it.
The Resignation Procedure
The resignation procedure of a company secretary is as mentioned below:
- The company secretary has to submit an official resignation letter.
- The board of directors must unanimously pass a resolution and accept the resignation to confirm the removal of the company secretary.
- The company needs to inform ACRA for a cessation of company secretary using BizFile within 14 days from the date of resignation.
After meeting these requirements, including notifying ACRA about the resignation, the transition, handing over the responsibilities and sharing administrative records happens at a later date. Failure to notify ACRA within the specified time frame may result in a late lodgement fee.
What If My Company Secretary Refuses To Resign?
In the case of forced separation, and your company secretary refuses to resign, you still hold the right to remove him/her from the position.
A situation like this may lead to some complications and unpleasant situations if you have to remove your secretary from the position.
Ideally, before you decide on how to change corporate secretary, it is better to inform the secretary in advance about the decision of removal.
You can try to complete the removal procedure amicably. However, if the company secretary still does not agree, you can anyway go ahead and use your right to removal by passing a board resolution and submitting the cessation to ACRA.
How Do I Appoint A New Secretary?
Once the existing company secretary resigns, you need to appoint a company secretary within 6 months from the date of resignation. According to ACRA, a company secretary needs to be:
- A natural person;
- A local resident in Singapore.
The Procedure of Appointment
The appointment of a new company secretary can happen:
- Through a voting by the company directors, which is also called board resolution.
- Through a Directors’ Resolution of Writing (DRIW). The document captures all the details of appointing a new secretary and also about the resignation of the previous secretary.
- The newly appointed company secretary should give his/her consent to work as a secretary through form 45B.
Just a small note about a rule. According to ACRA, the sole director of a company and the company secretary must not be the same person.
Who Is Responsible for The Transition?
After a company files a cessation within 14 days after the previous company secretary resigns, the transition period starts.
This time too, the directors have the responsibility to select a good candidate for the position, keeping in mind the issues with the last secretary.
During the appointment, the directors have to make sure that the new company secretary does all the duties efficiently. Also, the secretary should be able to comply with all the rules and regulations for operating a business in Singapore.
To complete the transition, it is usually the responsibility of the new company secretary to understand his/her responsibilities, process all documents correctly, review the records, and ensure that the transition does not disrupt the business process.
How Do I Choose The New Secretary?
What does a Company Secretary do?
Check out the job responsibilities of a company secretary here.
According to the Singapore Companies Act, to get appointed as a company secretary, an individual must meet at least one of the conditions below:
- The person should be familiar with the laws and regulations to run a company in Singapore.
- The candidate should have at least 3 to 5 years of experience to get an appointment as a company secretary in a public company.
- The individual is a public accountant registered under the Accountants Act.
- Fulfills the standards laid out within the Legal Profession Act.
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