Representative Office in Singapore | How to register representative office?

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Learn more about Representative Office in Singapore

Setting up a representative office in Singapore is recommended if you are interested in the Singapore market and want to investigate the potential of your firm. A representative agency has various advantages, but it also has downsides, such as the inability to function for more than three years. To ensure that you are registering for a representative office correctly, you can contact and receive assistance from our experts.

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What is a Singapore representative office?

An international company may open a representative agency to test the market in Singapore and the region in order to determine the viability of starting a business in Singapore. It can be established for a maximum of three years before converting to a private limited company, becoming a branch of the foreign company, or closing down. During these three years, this office must be examined and re-approved on an annual basis.

A representative agency can only acquire market information for the corporation from outside sources. It is unable to negotiate or conclude contracts on behalf of its parent.

Advantages:

➤ There are no ACRA registration requirements, no minimum capital requirements, and no compliance requirements such as filing tax reports or maintaining accounts.

➤ A representative office is not required to file any financial or other statutory returns with the Singapore government.

➤ Because of its operational constraints, it has a low maintenance cost from a compliance standpoint.

➤ Permitted to get a central registration number from the parent firm in order to import and export sample products and materials.

Disadvantages:

➤ It must limit its activities to promotion and liaison, market research, and event planning on behalf of the foreign company.

➤ It is not a legal entity and is not permitted to engage in profit-making activities. It is not permitted to sign or enter into contracts, sign deals on behalf of the company, issue invoices or letters of credit, or engage in trading activities.

➤ A representative office is not a separate entity from the parent company, and the parent company is liable for the office's liabilities.

➤ Cannot be in operation for more than three years and must be renewed on an annual basis.

What is required to set-up a representative agency?

The following criteria must be met in order to be registered as a representative agency:

➤ The foreign entity's sales turnover must be greater than SG$250,000.

➤ The foreign entity must have been in operation for more than three years.

➤ The proposed number of employees for this office should not exceed five.

The following documents are required to accompany the application for the registration of a representative agency in Singapore:

➤ A soft copy of the foreign entity's certificate of incorporation or registration certificate (where applicable) as an attachment.

➤ The most recent audited accounts of a foreign entity in soft copy as an attachment.

The application for registration must be submitted to Enterprise Singapore rather than ACRA. There is a processing fee of S$200 per year. This is non-refundable if your application is unsuccessful or withdrawn. You can get help from a Themis Partner with the application process.

What are the permitted activities?

A representative agency is authorised to do the following activities in order to conduct market research and feasibility studies on the possibility of establishing a permanent business in Singapore:

➤ Collect data on competitors and customers.

➤ Conduct market research on product demand, customer specifications, and price expectations.

➤ Gather information on establishing a permanent company entity in Singapore.

➤ Make trade relationships and respond to product queries.

➤ Attend trade displays and exhibitions.

This office may not, in particular, participate in the following activities:

➤ Conduct commercial or business activity.

➤ Enter into business contracts or negotiate sales.

➤ Issue invoices or receipts.

➤ Open and receive letters of credit.

➤ Rent property.

➤ Participate in promotional efforts or provide marketing services.

➤ Source, procure, or find raw material or component suppliers.

➤ Serve as the parent company's liaison with distributors or agents.

➤ Coordinate orders or other business activities between the parent company and its clients.

➤ Perform quality control checks or give technical supervision.

How to register a representative office?

To open a representative agency, you must:

➤ Fill out the application form.

➤ File the necessary paperwork: certificate of incorporation for a foreign firm and the most recent audited financial statements.

➤ Respond to any more questions or provide any other information asked by the authorities.

➤ Once the representative agency registration is approved, apply for an employment pass for the staff member (from the head office) who will be relocating to Singapore.

➤ Once the application is submitted, it takes about one week to receive approval from the authorities and confirm the establishment of your representative office.

What to do after register the office ?

After the application is granted, the representative agency’s registration is valid for one year and must be renewed. Because it is a transitory arrangement, it can only be renewed for a maximum of three years before being upgraded to a subsidiary or a branch office by the parent firm.