Looking to explore an option of opening a Representative Office in Singapore? While we don’t offer this service to foreign companies looking to set up a Representative Office in Singapore, we understand that companies sometimes look at different options before opening a company here. Once you’ve explored all options and looking to open business in Singapore, you can contact our awesome agents to guide you through.
This option of registering a Representative Office allows you to perform a market assessment and identify your business potential while assessing the regulatory requirements. You can also decide whether Singapore is the best launchpad for you to kickstart your business expansion in Asia without the need to create a whole new company. Read on to find out if this is the best solution for your business needs.
Here’s what this article will go through:
What is a Representative Office in Singapore?
A Singapore Representative Office (RO) is a temporary establishment with no legal status and acts as an extension of your foreign company. It serves mainly to assess the country's business potential, without the benefits that a subsidiary or local private companies can enjoy.
As such, the Representative Office will not be able to take part in activities to yield profits or revenues, but activities that require you to spend money are allowed. This means that the scope of business including opening or negotiating Letter of Credit, tenure of a warehouse, providing chargeable services, trade involvement or concluding contracts is strictly prohibited.
What a Representative Office is allowed to do
One drawback of pursuing this route would be the limited set of activities your company is allowed to carry out.
A Representative Office is only allowed to engage in activities including market research and feasibility studies. For example, the Representative Office can take part in trade shows and exhibitions, gather information about clients and potential customers, build trade contacts, research demand for the product, as well as to handle product-related enquiries.
Let's say you own an established American trading company looking to expand into the Asia market. You are unsure of whether this region would be receptive to your offerings. To better gauge response, you’ve decided to open a Representative Office to survey the market. In this way, you do not have to undergo the hassle of extensive paperwork to create a whole new company from scratch. Instead, you take part in trade shows to exchange information with fellow industry leaders and in the process, find out how to better improve your products.
The Representative Office is considered the same entity as its parent company, which means that the parent company will be held liable for the actions of the Representative Office. Take heed to the permitted activities, for Representative Offices that fail to comply may face the risk of being deregistered.
Things You Need to Register
Foreign companies that wish to set up a Representative Office in Singapore will have to tick the following checkboxes:
- Have a Sales Turnover of at least US$250,000
- Must be established for a minimum duration of 3 years
- Maintain the proposed number of staff within 5 people
Documents you’ll need
When registering a Representative Office in Singapore, the following documents will be required:
- A completed application form
- A copy of the foreign company’s Certificate of Incorporation or Registration Certificate from the jurisdiction they incorporated in, whichever is applicable
- A copy of the foreign company's latest Audited Accounts in softcopy, as an attachment
Note that all submitted documents are required to be in English, or officially translated into English. If you need help with this, we can help you with it, drop us a chat and let us know.
Register with IE Singapore or MAS depending on which sector your company is in.
Businesses in the manufacturing, wholesale, international trading, trade and trade-related sectors can register a Representative Office with IE Singapore.
If your business falls under the banking, finance or insurance sectors, you may also set up a Representative Office in Singapore under the purview of the Monetary Authority of Singapore (MAS) and will have to be registered in accordance to MAS guidelines.
In general, foreign entities will have to register their Representative Office with International Enterprise (IE) Singapore via an online registration process. All you have to do is to submit your application via an online form here. After the submission, you can either make payment via credit card or mail your bank draft or cheque to Enterprise Singapore.
On average, it takes around 5 business days to get approval. If your application is approved, IE Singapore will send a Letter of Approval confirming your registration.
Time & cost
Upon successful application submission, the foreign entity is required to pay the S$200 registration fee, with cheque, credit card or bank draft as viable payment modes. IE Singapore does not accept cash payments.
Renewal of registration
Once your registration is approved, your licence will only be valid for a year. After that, you’ll have to renew annually.
The office can be renewed for a maximum duration of 3 years. Two months before the expiry, IE Singapore will send the Representative Office a renewal notice. The Representative Office must be renewed seven days prior to the expiry date. Set a reminder on your calendar for this! Or you can leave it to us to remind you.
Once you've renewed your yearly registration for a period of 3 years, your company can consider either setting up a subsidiary or branch office in Singapore to expand your business. Foreign entities will not be allowed to continue with its Representative Office after 3 years.
Should there be no response from the Representative Office, IE Singapore will follow up with a reminder notice on the expiry date. A month after the expiry, a final reminder will be sent to the Head Office with 14 days for the Head Office to take action. In cases of non-response, authorities will deregister the Singapore Representative Office.
Bank account opening upon approval
Once you've successfully registered your Representative Office, you can open a bank account in any international and local banks in Singapore. As the bank account opening process may vary across banks, factor 2-10 business days into your timeline upon submission of the required documents.
Documents you need for this are:
- Signed and Completed Account Opening Application Form
- A copy of Letter of Approval from International Enterprise Singapore
- A copy of Memorandum & Articles of Association of Parent Company
- A copy of Certificate of Incorporation of Parent Company
- A copy of Register of Directors (or equivalent)
- Board of Directors Resolution consenting to the opening and signatories of the account
- Proof of Beneficial Ownership which may include a copy of Certificate of Incumbency, Register of Shareholders or Declaration of Beneficial Ownership, together with Beneficial owner’s identification card/passport copy
- Identification card/passport copy of directors, as well as authorised signatories and chief representatives
In a nutshell, a Representative Office acts as a good temporary administrative option for companies. Businesses that are not ready to set up a full-fledged office in the little red dot can consider this option to test the waters and explore opportunities in Singapore, before registering their company with Singapore.
Once you’re ready to incorporate your company in Singapore, tell us all about it. If you’re ready to embark on your business endeavours on the sunny island, we wish you nothing but the best!