Outline
Regulated by The Accounting and Corporate Regulatory Authority (ACRA), foreign companies can establish a Representative Office (RO) in Singapore to explore business opportunities before committing. Furthermore, an RO allows assessment of the business environment without engaging in profit-yielding activities.
However, for sales purposes, incorporating a private limited company is advisable.
Permitted Activities Under a Singapore Representative Office
The representative office aims to assess product or service demand, similar to conducting market research in the country. Additionally, here is a list of activities that this company type is allowed to engage in:
Additionally, representative offices have limitations on their activities, including:
Requirements to Setup a Representative Office in Singapore
The requirements for a RO setup in Singapore are:
Documents Required to Start a Singapore Representative Office
The following documents must be submitted:
Timeline, Fees & Validity for Representative Office in Singapore
Setting up a RO in Singapore typically takes 5 working days for approval, with a processing fee of $200 payable by cheque, credit card, or bank draft only. However, no cash is accepted.
Following approval, you’ll receive a one-year validity Letter of Approval, along with a renewal notice sent approximately 2 months before expiry.
However, should there be no response for the renewal of the representative office, the authorities will proceed to strike off. Take note that you can only renew for a maximum of 3 years.
Comparison Between RO, Branch & Subsidiary Company in Singapore
Foreign companies setting up in Singapore have multiple avenues to do so. See below for a comprehensive comparison between branch office, subsidiary companies, and representative offices and what sets them apart from each other.
| Singapore Branch Office | Singapore Subsidiary Company | Singapore Representative Office | |
| Legal Type | Not a separate legal entity but an extension of the parent company | Separate legal entity distinct from its parent company | Has no legal status, a temporary administrative arrangement |
| Liabilities | Liabilities incurred by the branch office extend to parent company. | Parent company can limit liabilities to subsidiary. | Liabilities incurred by the representative office extend to parent company. |
| Taxation | Taxed a flat corporate tax rate of 17% as non-resident entity, local tax benefits and exemption not available | Taxed a flat corporate tax rate of 17% as Singapore resident entity, local tax benefits available | Not applicable |
| Validity Period | Registered forever until closed | Registered forever until closed | You must renew it every year for a maximum of 3 years. You need to evaluate and renew the RO status annually. |
What is the ideal timing to transform my representative office in Singapore into a legal entity?
A Representative Office of a foreign commercial entity can operate in Singapore for up to three years, subject to annual evaluation and renewal. Thus, if they wish to continue beyond this period, they must register with the Accounting & Corporate Regulatory Authority (ACRA) of Singapore.
At what point would it be strategically ideal for you to convert your Representative Office?
FAQs
The tax exemption for start-ups which has been offered by the Singaporean government is currently expected to remain in place for the foreseeable future. The government has always had the intent to develop entrepreneurship in the country. Therefore, it would like to keep this exemption in place to foster the development and growth of start-ups in Singapore.
The information listed within a company business profile is important because it verifies the details about the company. The company business profile proves that the company is genuine and devoid of the intent to deceive its customers. For this reason, the company business profile (along with the certificate of incorporation) is required for all of the company’s contractual and legal activities.
There are no restrictions on the identity of those who plan to incorporate a company in Singapore. Anyone who fulfills all of the necessary criteria is allowed to do so. However, those who fail to fulfill the criteria may not incorporate a Singapore company until they have done so.
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