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Singapore: Understanding The Role Of A Company Director

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Singapore: Understanding The Role Of A Company Director

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On 15 April 2015, the Singapore Accounting and Regulatory Authority (ACRA) announced legislative changes to Chapter 50 of the Companies Act, effective in two phases: phase one from 1 July 2015 and phase two in the first quarter of 2016 (Q12016). Robin Yoo, Corporate Secretarial Services Director of the Singapore office, explains the changes.

Company Directors and their duties

Under the Companies Act, every company in Singapore is required to have at least one director who resides in the country. If a company has only one member, the sole director can also act as the sole member. Multi-national companies which start their businesses in Singapore often use a local resident director through a third party in order to facilitate the incorporation process and to comply with regulation.

In Singapore, there is no distinction between the two. However, a local resident director who does not take on any executive or managerial function within the company may find they are non-compliant with the relevant statutes that are administered by Singapore’s authorities such as ACRA, Inland Revenue Authority of Singapore or the Central Provident Fund (CPF) Board.


Local directors who are found to be non-compliant can be summoned to Court. They are obliged to rectify the breaches (for example to file the proper estimated chargeable income, or annual filling with the relevant statutory board, or make the compulsory payment to employees within a time frame) as well as pay any imposed fines.

The responsibilities for third-party local resident director are the same as an executive director of a company, predominantly because the person lives in Singapore. Although foreign-based directors are not required to attend any court hearings in Singapore , when a Warrant of Arrest is issued, they may be detained at Singapore’s Changi Airport upon arrival.

Alternate address

Another change in the proposed amendment is to protect individual privacy. The Directors, CEOs and secretaries will be able to file an alternative address with ACRA, in place of their residential address. Individuals who give a fraudulent address will be subject to criminal sanctions, and unable to provide another alternate address for three years.

The new Section 155B of the Companies Act has empowered ACRA to debar any company’s director who has failed to lodge relevant documents within three months of the prescribed deadlines. The debarred person cannot take on any new appointment as a director or company secretary. They may continue with existing appointments and only when the defaults are rectified, or on other prescribed grounds, will ACRA lift the debarment.

The imposition of a debarment regime is to prevent irresponsible directors from churning out companies by incorporating and thereafter, closing it. The debarment also aims to promote greater compliance awareness and instil the importance of timeliness.

TMF Group secretarial services in Singapore assists with stringent due diligence. Our local experts follow up closely on filling requirements, especially on annual returns with ACRA (previously known as Registry of Companies).

Get in touch with the Singapore team to learn more.

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