A Limited Liability Partnership can only be owned by a Singapore national or resident, and foreign nationals and enterprises are permitted only if one local manager is appointed or hired. A Private Limited Company can be fully foreign or 100% locally-owned; however, there should be at least one Singapore Resident Director. A Limited Liability Partnership can have any number of members and there is no limit on that, whereas a Private Limited Company can only have a maximum of 20 members in case of exempt companies.
The business entities that one can form in Singapore are sole proprietorship, partnership, limited partnership and Limited Liability Company. Out of these, private limited liability company is the most commonly found form of legal structure in Singapore.
There are many advantages of setting up a company as a Limited Liability Partnership in Singapore. These are as follows:
There are also some disadvantages of an LLP in Singapore:
The Managing Director(s) usually have the task of running the company. Shareholders could also but it’s not necessary that they be the directors of the company.
The share certificate is a proof of share ownership. Anyone who owns shares in a particular company are known as its “shareholders”.
If you are a foreign national who represents companies out of Singapore, you could register a private limited company or a limited liability corporation, which could either be a subsidiary, a branch or a representative office, depending on the company’s requirements.
Most of the small and medium enterprise owners opt to incorporate a Subsidiary in Singapore rather than setting up a branch office. This is because a subsidiary has various advantages such as:
In addition, a subsidiary in Singapore becomes a tax resident whereas a branch office is not a tax resident. The control and management of a branch office are fully under the influence of the parent company.
If you register your business as a branch office in Singapore, your branch office will not be considered as a local company. It is counted as the extension of the foreign parent company. The management will have to abide by the Memorandum and Articles of Association (MAA) of the parent company while managing with things related to shareholding, operational activities, and deciding the structure etc. As a branch office is not considered as a separate legal entity from its parent company, the responsibility of its debts and losses lie with the parent company.
Many foreign companies like to survey new market to check the avenues before they move their resources and set up their presence in it. Registering a representative office in Singapore will help in carrying out these activities.
Though a representative office bears no legal status, it is considered as just a temporary or administrative arrangement for its parent company. As per the Singapore Companies Act, this form of a business structure cannot carry out any business activities.