Everything You Need to Know About the Role and Function of a Nominee Director in Singapore
Singapore’s pro-business environment makes it an attractive destination for foreign businesses to start a company. If you are foreigner planning to register a company in Singapore, then you would probably have done some research on the requirements and are aware of the need to appoint a minimum of one resident director for your company. Well, most of the people seem to get confused about the concept of resident and nominee director in Singapore.
According to the Accounting & Corporate Regulatory Authority (ACRA), a resident director must be ordinarily resident in Singapore with a local residential address. Besides that, the person can either be a Singapore citizen, Permanent Resident, Employment Pass holder, or EntrePass holder.
If you belong to one of the categories mentioned above, you can appoint yourself as the resident director. However, what happens if you are living outside of Singapore and are unable to comply with the requirement of a resident director for your company? In such a situation, you can appoint a Nominee Director as the resident director.
What is a Nominee Director’s Role?
The Singapore Companies Act defines a director as an individual “with whose directions or instructions the directors of a corporation are accustomed to act and an alternate or substitute director.”
By definition, a Nominee Director is someone who represents the interests of another person of the group. A Nominee Director in Singapore has the same obligations and responsibilities as a regular resident director in line. Also, their responsibilities are similar to resident director according to the Companies Act and the common law.
Hence, the Nominee Director’s primary role is to comply with the resident director requirement. He or she is still a director according to the law and has to act in the interests of the appointing company. As such, simply hiring an inexperienced Singaporean to fill the position may not be a very prudent business decision.
Here are some important reasons to select a qualified and trustworthy individual for this role:
- He or she must have an acceptable level of knowledge and skills to handle the affairs of the company.
- He or she acts as a director-level representative to undertake various jobs. This includes financial paperwork, engagements with the local authorities on license registrations, etc.
- He or she has a responsibility to perform his or her duties with honesty and integrity. Also, he or she must be able to avoid any conflict of interest in the company.
- He or she must keep abreast of company tax and accounting updates and statutory obligations. His/ her responsibility also consists of working with the company secretary to ensure that all required documentation is lodged with ACRA in a timely manner.
Why Engage a Director from a Professional Services Firm?
For foreign entrepreneurs, peace of mind is the number one reason. The Nominee Director Services at 3E Accounting, for instance, consists of a team of reputable and trustworthy professionals. The Nominee Director is a qualified accountant and local resident who is part of the 3E Accounting senior management. With the right capabilities and competence, he is able to help your company maintain good standing and ensure full regulatory compliance. By providing our own director for our Nominee Director Services, we assure you that we have the safety and perpetuity of our clients’ businesses at heart. Find out more here on how 3E Accounting is the solution to your Nominee Director needs.