Singapore Companies (Amendment) Act 2017 – Company Seal and Register of Registrable Controllers

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Singapore Companies (Amendment) Act 2017 – Company Seal and Register of Registrable Controllers

Singapore Companies (Amendment) Act 2017 and Limited Liability Partnerships (Amendment) Act 2017

Companies (Amendment) Bill 2017 and Limited Liability Partnerships (Amendment) Bill were passed in Parliament on 10 Mar 2017.

Key legislative amendments to take effect from 31 Mar 2017

i) Company Seal

With effect from 31 Mar 2017, companies and limited liability partnerships (LLPs)  are no longer required to use the common seal in the execution of documents as a deed, or other documents such as share certificates. Companies and LLPs can execute documents by having them signed by authorised persons. However, companies and LLPs can choose to retain the use of a common seal based on business needs.

Authorised persons for companies 

  • A director and the secretary of a company;
  • Two directors of a company; or
  • A director of a company in the presence of a witness who attests the signature

Authorised persons for LLPs 

  • Two partners of an LLP; or
  • A partner of an LLP in the presence of a witness who attests the signature.

ii) Requirement for Companies, Foreign Companies and Limited Liability Partnerships to maintain Register of Registrable Controllers

With effect from 31 March 2017, companies, foreign companies and LLPs (unless exempted) will be required to maintain beneficial ownership information in the form of a register of registrable controllers, and to make the information available to public agencies upon request. A Controller is defined as an individual or a legal entity that has a “significant interest” in or “significant control” over the company.

  • The registers of registrable controllers is to be maintained at prescribed places, e.g. the company’s/LLP’s registered office or the registered office of the registered filing agent.
  • The register can be maintained in paper or electronic format.
  • The registers of registrable controllers will be kept only by the corporate entity and will not be made available to the public.
  • Companies and LLPs must give the Registrar and ACRA officers, as well as public agencies (e.g. law enforcement authorities such as the Commercial Affairs Department, Corrupt Practices Investigation Bureau and the Inland Revenue Authority of Singapore) access to their registers of registrable controllers upon request.
  • The information therein can only be used by public agencies for the purpose of administering or enforcing the laws under their purview (e.g. investigation of money laundering offences).
  • Companies and LLPs will have to declare with ACRA the location of the company’s register of registrable controllers when filing the company’s annual returns or annual declaration .
  • Companies and LLPs can discharge their duties by sending notices to the relevant parties and recording their particulars, as well as sending further notices to any other parties that have been revealed as potential controllers. Notices can be sent and replies may be received, in electronic or hard copy format.The company or LLP is not liable should recipients of these notices fail to respond or provide inaccurate responses.
  • A controller is required to provide and update information to the company/LLP

Who can be a “Controller” of a Company?

A controller who has significant interest in a company may include any of the following:

A) Based on Significant Interest

 Companies with Share Capital  Companies without Share Capital  

An individual who has:

  • Interest in more than 25% of the shares
  • Shares with more than 25% of total voting power in the company

An individual who has:

  • Right to share in more than 25% of the capital or profits of the company

B) Based on Significant Control

A person who:

  • holds the right to appoint or remove directors who hold a majority of the voting rights at directors’ meetings;
  • holds more than 25% of the rights to vote on matters that are to be decided upon by a vote of the members of the company; or
  • exercises or has the right to exercise significant influence or control over the company.

A controller of the LLP is a person who:

  • holds, directly or indirectly a right to share in more than 25% of the capital, or more than 25% of the profits, of the LLP; or a right to share more than 25% of any surplus assets of an LLP on a winding up;
  • holds the right, directly or indirectly, to appoint or remove the manager of the LLP, or if the LLP has more than one manager, a majority of the managers of the LLP;
  • holds the right, directly or indirectly, to appoint or remove the persons who hold a majority of the voting rights at meetings of the management body of the LLP;
  • holds, directly or indirectly, more than 25% of the rights to vote on those matters that are to be decided upon by a vote of the partners of the LLP; and/ or
  • has the right to exercise, or actually exercises, significant influence or control over an LLP.

WHAT ENTITIES ARE EXEMPTED?

  • Companies

Companies exempted from the requirement to maintain the register of registrable controllers are:

    1. a public company which shares are listed for quotation on an approved exchange in Singapore;
    2. a company that is a Singapore financial institution;
    3. a company that is wholly owned by the Government;
    4. a company that is wholly owned by a statutory body established by or under a public Act for a public purpose;
    5. a company that is a wholly-owned subsidiary of a company mentioned in sub-paragraph (a), (b), (c) or (d);
    6. a company which shares are listed on a securities exchange in a country or territory outside Singapore and which is subject to —

i. regulatory disclosure requirements; and
ii. requirements relating to adequate transparency in respect of its beneficial owners
(imposed through stock exchange rules, law or other enforceable means).

Listed companies and Singapore financial institutions are exempted from the new requirement as listed companies are already subject to disclosure requirements under the Securities and Futures Act.  MAS, as the supervisory authority, will have access to the controllers’ information of Singapore financial institutions.

  • Foreign Companies

Foreign companies that are exempted from the requirement to maintain the register of registrable controllers are:

  1. a foreign company that is a Singapore financial institution;
  2. a foreign company that is a wholly-owned subsidiary of a foreign company that is a Singapore financial institution;
  3. a foreign company which shares are listed on a securities exchange in a country or territory outside Singapore and which is subject to —
    i. regulatory disclosure requirements; and
    ii. requirements relating to adequate transparency in respect of its beneficial owners
    (imposed through stock exchange rules, law or other enforceable means)
  • Limited Liability Partnerships

LLPs that are exempted from the requirement to maintain the register of registrable controllers are:

  1. a LLP that is a Singapore financial institution;
  2. a LLP which all partners are companies or foreign companies exempted from the requirement to maintain the register of registrable controllers.

What information to be maintained in the Register of Registrable Controllers?

A person receiving a notice from a Company or LLP are likely to provide the following:

  • his particulars if he is a controller
  • Any information that he is aware of about controllers

A) Individual Controllers

  • full name (including aliases);
  • residential address;
  • nationality;
  • identification number e.g. IC or passport number;
  • date of birth;
  • date on which the person becomes, and if applicable, the date on which the person ceases to be a controller.

B) Corporate Controllers

  • Name;
  • If applicable, Unique Entity Number or other similar identification number;
  • Address of registered office;
  • Legal form of the entity and the law by which it is governed;
  • If applicable, the register of companies in which it is entered (including details of the state, country and the entity’s registration number in that register); and
  • Date on which the person becomes, and if applicable, the date on which the person ceases to be a controller

Please refer to “Setting up and maintaining the Register of Registrable Controllers” for more information.

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Disclaimer: This publication does not provide financial, legal or tax or advice of any kind, and VALON cannot guarantee that the information is accurate, complete or up-to-date. While we intend to make every attempt to keep the information in this publication current, VALON make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained herein. Nothing on this publication should be used as a substitute for the advice of a third party. VALON assumes no responsibility to any person who relies on information contained herein and disclaim all liability in respect to such information. You should not act upon information in this publication without seeking professional advice.

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