On 2 July 2024, Singapore passed the Corporate Service Providers (CSP) Bill and the Companies and Limited Liability Partnerships (Miscellaneous Amendments) (CLLPMA) Bill. The two Bills amend existing laws to strengthen Singapore’s anti-money laundering regime and increase transparency within the corporate services sector.
Overall, these changes raise the bar for corporate service providers in Singapore and requires them to do more to be compliant.
This article explores the changes affecting corporate service providers in Singapore and what it means to potential clients seeking professional services.
All CSPs need to be registered with the regulator
As per the new requirements, all entities offering corporate services in and from Singapore will need to be registered with the Accounting and Corporate Regulatory Authority (ACRA). ACRA is the regulator of business registration, financial reporting, public accountants, and corporate service providers in Singapore.
All registered CSPs must comply with anti-money laundering, countering the financing of terrorism and the proliferation of weapons of mass destruction obligations. A registered CSP which breaches these obligations is guilty of an offence and shall be liable on conviction to a fine not exceeding SG$100,000 for each breach.
This raises the bar for any company that intends to provide corporate services. It is also an additional layer of security and assurance that your CSP is adhering to strict regulatory standards.
Consequently, while this may limit the pool of providers to choose from, it can help safeguard your company’s reputation and give you more assurance as you can be certain that your CSP is registered and compliant.
Nominee directors
The CSP will be responsible for verifying the eligibility of potential nominee directors, ensuring the individual is fit and proper, and not disqualified from serving as a director under any existing laws. A registered CSP which breaches this requirement is guilty of an offence and shall be liable on conviction to a fine not exceeding SG$100,000.
This helps to ensure that only suitable individuals are appointed, enhancing the integrity of nominee directorships.
Nominee status of director and shareholder must be disclosed
Additionally, all information documented in your registers of nominee directors and shareholders must be reported to ACRA. This means disclosing the particulars of nominee directors and shareholders as well as the identities of nominators.
This is critical to ensure that ACRA has the most current and accurate information regarding the nominee arrangements within your company. Non-compliance can lead to substantial fines, which have increased to SG$25,000 from the previous SG$5,000.
Note that the nominee status of your director and shareholder will be made publicly available. However, only public agencies will have access to all information maintained by ACRA.
Given this, it is important to review your registers on a regular basis. This may help you identify and correct any discrepancies early to avoid potential penalties.
Start your business in Singapore with confidence
Overall, the added regulatory measures are designed to ensure a more secure business environment and raise the standards for CSPs. It weeds out bad players, and at the same time adds more responsibilities and associated risks to good ones. Overall, it is good news for potential clients who require high quality professional services.
At Hawksford, we maintain high professional standards and ensure all regulatory requirements are met. If you are planning on starting a business in Singapore, we can streamline the process for you, ensuring all necessary steps are taken care of efficiently and accurately. As an ACRA-registered CSP, our expertise and knowledge will ensure a smooth formation process while you focus on core business operations.
For more information on how we can support your business, please get in touch with our team.
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