The Urban Redevelopment Authority (URA) has release data showing the surge in median rentals of non-landed residential properties to $32.41 per square metre (PSM) in May from $30.54 psm in January, while rental for units in the central region stands at an even higher price of $36.89 psm. Currently, the maximum monthly rental for non-landed residential properties in central Singapore stands at $114.58 psm.

Across Singapore, maximum rental swerves between $33.65 psm to $60.87psm. while minimum rentals varies between $10.18 psm to $14.36 psm.

Market watchers commented that this surge in residential rents is a direct result of an economy that is picking up as well as a strong property market. The rising number of property owners who increase rent in a bid to earn higher returns could be another contributing factor to the rental surge.

Mr James Nuben of Asiabiz Services said that factors such as the increase in housing demand by more foreign individuals who incorporate a Singapore company, and relocate to the country, also adds to the rise in rental figures.

Asiabiz Services specialises in Singapore company incorporation and the application of Employment Passes or EntrePasses for foreign individuals and companies.

“We get a large number of foreign businessmen looking to incorporate a company in Singapore and wanting to move here to run their operations because the quality of living is very good. Plus, more international companies are also setting up a presence in Singapore and bringing in more foreign talent, who will require accommodations,” said Mr Nuben.

“Business have started to relocate to Singapore and are bringing in a lot of foreign workers, which have increased demand for residential housing, as compared to the first half of last year, when companies were shedding staff,” confirmed Donald Han, managing director of Cushman and Wakefield.

However, Mr Colin Tan, head of research and consultancy at Chesterton Suntec International thinks otherwise – that the rental hikes are due to a sharp drop in housing supply. The number of demolitions conducted in the fourth quarter last year saw 1,441 units torn down compared to the 1,400 units available.

Mr Tan said that this is because there were more collective sales, resulting in more units disappearing. The demolitions caused a drop in the number of units – only 1,407 units, available for rent for the first quarter.

“The higher number of demolitions is probably a one-off effect. The numbers of demolished units returned to about 400 units-odd in the first quarter of this year. Rentals will increase as there are fewer units available and there is a high demand for them,” added Mr Tan.

On a brighter note, Mr Tan said he expects the rental hikes to stop climbing in the next few months.

However, Mr Han said Singapore’s economic growth will bolster rental prices, marking an increase of 5 per cent to 8 per cent by the end of the year. This increment makes it a good time for homeowners who want to lease out their properties to guard against volatile markets and inflation.

“Yields have risen slightly to 3 per cent to 3.8 per cent and are likely to go up over 4 per cent at the end of the year. With the low interest rate of 1 per cent to 1.2 per cent, this is a good time for residential yields,” said Mr Han.

The Infocomm Development Authority of Singapore (IDA) added that it has plans to invest S$1.1 billion in about 350 ICT tenders for this financial year (FY) which ends on 31 March 2011.

IDC senior market analyst Gerald Wang said this increase in spending is certainly good news for the industry.

Mr Wang said that he expects 50 per cent of the new tenders released in 2010 to multiply business opportunities for a wide range of vendors, as these small projects are less than S$500,000 each.

Mr James Nuben of Asiabiz Services says that the number of foreign individuals incorporating a Singapore company to run ICT-focused businesses such as building and releasing online micro-transaction games for social networks, or provide cloud-computing services, has also been steadily increasing.

“The growth potential for foreign investors setting up companies to expand the ICT industry is very huge and Singapore is a great place to incorporate a company because it provides a very safe environment for businesses to grow,” said Mr Nuben.

Asiabiz Services specialises in Singapore company formation and staff relocation services, including work visa applications for foreigners.

Even though the Government appears to be spending less by awarding S$1.6 billion and S$1.12 billion worth of ICT contracts in FY2008 and FY2009 respectively, the figures do not reflect the actual increment.

Instead, the figures appear to drop because they included huge one-time projects that include the Standard ICT Operating Environment (SOEasy) and the Next-Generation National Broadband Network (NGNBN). The regular ICT expenditure has actually been increasing consistently when the huge projects are not included in the spending numbers.

“After deducting the NGNBN project’s sum of S$250,000, the S$1.1 billion projected spending for this year is significantly more than last year’s S$870 million. I expect future government projects in Singapore to focus on building upon what has already been built before,” said Mr Wang.

ICT spending with a focus on cloud computing, social networking, business analytics and technology will help the Government strengthen their collaboration with citizens and reach out to citizens.

“Proposals that will allow the government agencies to reduce huge upfront capital expenditures and manage operational expenses will be the most well-received,” said Mr Wang.

Deputy Prime Minister Wong Kan Seng said the Government has recently reviewed its immigration policies and will refine the criteria for approving PR applications ‘to better manage the pace and overall numbers’.

“We will ensure that those who become one of us are of better quality, and not only contribute to Singapore economically but also integrate well into our society,” said Mr Wong, who is also the Home Affairs Minister, when responding to concerns aired by MPs during the three-day debate on the Budget Statement in Parliament.

As for the number of new citizens, he said this will depend on the quality of the applications. But if there are good applicants, the Government would take in up to 20,000 a year, he said.

Last year, a total of 59,500 PRs and 19,900 citizenships were granted, compared with 79,200 and 20,500 respectively in 2008.

While measures to reduce the number are in place, Mr Wong said he is ‘not in favour of any absolute cap on the number of PRs’. Explaining, he said: “How many we take depends on the quality of the applicants, and there may be events which trigger an unexpected surge in numbers, which we should take advantage of.”

Mr Wong also said that the Government ‘will not condone discrimination against Singaporeans’, but it ‘cannot ring-fence jobs and reserve them only for Singaporeans’. He reasoned that ‘if we want to compete globally, we have to create an environment which can attract the best people’.

“If foreigners are not here to help us compete against other countries, they will be working in other countries to compete against us. The future will see global competition becoming more and not less intense,” he warned.

Acknowledging Singaporeans’ concerns and sentiments on what he described as a ‘highly complex’ subject, he said: “Indeed, in the last few years, we have seen a dramatic increase in the number of foreigners in Singapore. It is understandable that Singaporeans may feel uncomfortable over the sheer number of foreigners in our midst. The Government has taken note of this.”

He also said the Government will take steps to moderate the inflow of foreign workforce over time, even as he conceded that the change ‘will not be easy’.

Source: Singapore Strait times
by Melissa Pang

According to a study conducted by Singapore Management University, close to one quarter of Singapore listed companies have the same set of directors sitting on three board committees of 500 companies ,442 have all 3 committees leaving 11.6 % firms who do not comply with the recommendation of Singapore Code of Corporate Governance requiring 3 board committees to focus on specific issues. The committees are the Audit Committee ( AC) Remuneration Committee ( RC) and Nominating Committee( NC).

The study shows that 442 companies have all three committees in place. However there are 105 companies or 23.8 per cent with the same set of directors for all three board committees. The majority of these firms fall on the lower bands of market cap, so that smaller companies are likely to rely on the exact same set of directors for AC, RC and NC duties.

Having the same set of directors sitting in all three recommended committees ‘appears to be against the spirit of corporate governance therefore defeating the advantages of having board committees’ ,a discovery made by authors Themin Suwardy and Leong Kwong Sin, who are associate professors at the SMU’s school of accountancy. One school of thought is that the three committees in these 105 companies are, in fact, just one committee.

The study showed that 47.5 per cent sit on all three committees and 25.3 per cent sit on two committees. With almost half of these directors sitting on all three committees, Dr Suwardy and Dr Leong questioned their ability to contribute diligently to all three committees also raised the issue of whether a conflict of interest could arise.

For instance, the author asked “How would the RC members decide on the appropriate fees for NC members, who in turn assess the performance of AC members, if they are all the same set of directors in the three committees?”.

An analogy was drawn by the authors that the same directors appear to play musical chairs by occasionally swapping chairmanships of the three committees.

The study, brings to light that 45.2 per cent of the committee members chair one committee and 44.3 per cent do not chair any committee. Slightly over 10 per cent of these committee directors chair two or three committees. And, the ‘triple chairs’ – directors who chair all three board committees – can be found in 11 companies.

On the other hand, there are only eight companies that have three different directors chairing the three committees and the least number of directors in multiple committees.

One lawyer remarked that it could cause an inherent tension between the NC and RC if they have the same set of directors, likened to a case of “you scratch my back and I scratch your back” Stamford Law director Ng Joo Khin, states it would not be a problem for committees to have repeated members on different committees as long as they recognize the different roles and functions.

The bigger problem, he believes, arises when directors sits on multiple boards questioning whether they have adequate time to discharge their roles and responsibilities. ‘There is a risk of conflict of interest when directors sit on board of companies within the same industry.

David Smith, head of Asia corporate governance research at Risk Metrics Group, pointed out sitting on board committees would result in significantly greater workload for these directors.

Asiabiz is the leading authority in company formation in Singapore. We can help you incorporate your company with ACRA in less than 3 hours. We can also assist you in obtaining the required licenses and permits. Asiabiz also provides Nominee Directors services. To learn more about our Incorporation Services please go to Singapore Company Incorporation Services.

• The amount of income tax that you have to pay depends on your tax residency in Singapore.
• Top marginal resident tax rate of 20% kicks in at S$320,000 of taxable income.  Non-residents are taxed at the flat rate of 15% or the resident rates whichever results in a higher tax amount.
• Income is assessed on a preceding calendar year basis, ending 31 December. You must File Your Annual Tax Form by 15 April of the following year. You can usually expect to receive the income tax bills from May to August.
• Besides salaries and bonuses, perquisites such as housing and stock options will form part of your taxable employment income.
• Overseas income derived outside Singapore, Singapore dividends and bank interests are tax exempt in Singapore.

Paying your taxes: Sign up for the 12-month interests free GIRO Deduction Plan to pay your income tax
by installments. Otherwise, full payment has to be made within one month from the date of the income tax bill.

Are you a Tax resident or non-resident?

Different tax rates apply for tax residents and non-residents. You will be treated as a tax resident for a
particular Year of Assessment (YA) if you are a:

• Singaporean; or
• Singapore Permanent Resident (SPR) if you have established your permanent home in Singapore; or
• Foreigner who stayed/worked in Singapore for 183 days or more in previous year (excludes director of a company).

Otherwise, you will be treated as a non-resident for a particular YA for Singapore tax purposes.

Tax rates for non-resident individuals

• Employment income
  Your employment income is taxed at 15% or resident rate, whichever gives rise to a higher tax amount.
• Director’s fees, consultation fees & all other income
  The director’s fees, consultation fees and all other income that you received will be taxed at 20%.

If you are leaving Singapore or changing job

If you are about to leave Singapore or changing to another job within Singapore, your current employer
needs to notify IRAS and ensure that you settle all your taxes before you go. This process is known as tax
clearance. If you have any existing stock options or awards on hand which have yet to be exercised or vested,
you will be deemed to have derived gains from the stock or awards at the point of tax clearance.

Tax rates for resident individuals

For YA 2008 and 2009, a personal income tax rebate of 20%, up to a maximum of $2,000 is granted.

Ways to save tax

• Tax residents are eligible for tax reliefs that can be offset against the assessable income. You can get reliefs for wife support, child maintenance etc. Conditions apply.
• You may claim expenses incurred against your employment income; enjoy tax deductions for approved charitable donations. Conditions apply.
• Under the Not Ordinarily Resident (NOR) Scheme, you can enjoy either Time Apportionment of Singapore employment income or Tax Exemption of Employer’s contributions to Overseas Pension Fund, or both. Conditions apply.
• If you work for a foreign employer and need to travel overseas in the course of work, you may enjoy time apportionment of employment income under the Area Representative Scheme. Conditions apply.
• With the Avoidance of Double Taxation Treaties signed by Singapore, your income may not be taxed twice in Singapore and your home country. Conditions apply.

Need help on your Tax assessment and submission?

Asiabiz Services can assist you in your personal income tax filings. Our personal tax filing services include:

• Registration for new tax payers
• Preparation and filing of income tax return based on your income and determination of possible deductions and reliefs that are applicable to you
• Request for extension of deadline, if necessary
• Preparation of Form IR8A for employees
• Tax planning and tax advice

If you would like us to assist you with your personal income tax return, please contact us at +65-63034600 to discuss your requirement in detail or send us an email at ptax@asiabizservices.com and we will get back to you.

To begin, you will need to make sure your business is already registered with the Accounting and Corporate Regulatory Authority of Singapore (ACRA). Your business, may be retail, must register as a sole proprietorship, partnership or a private limited company.

Two more things have to happen before you can start importing goods into Singapore. First, after you have the business registered with ACRA, you will then activate your Custom Accounts using ACRA assigned Unique Entity Number (UEN) and Singpass. Second, you will have to be registered as a trader with Singapore Customs. As a trader you will be able to apply for permits using TradeNet® for each shipment of goods.

Generally most goods are considered ‘non-controlled goods’ such as clothes and shoes. You do not need license to import “non-controlled goods”. However, if you are going import “controlled goods” such as food and animal products, drugs or telecommunication items, you will need to apply for appropriate license for each category from the ‘competent authority’. An example would be importing animals and birds products, you have to apply for a license from the Agri-food and Veterinary Authority of Singapore.

Be forewarn that there is a significant amount of paperwork to submit for application of import permit for each shipment with the addition of customs documentation and clearance; insurance papers; and paperwork for “controlled goods”. There are also taxes, duties and fees to pay. You can do all the paperwork as you are also a registered trader with access to TradeNet®, however, most businesses choose to relegate the task to freight forwarders and cargo agents since the import procedure is quite complex.

Earlier in April 2009, European countries and the US had launched a campaign against tax havens, in order to prevent tax avoidance efforts of citizens and businesses holding funds in such jurisdictions that were potentially out of reach of domestic tax authorities. It had “grey listed” Singapore for non compliance to information sharing standards and for lack of legislations allowing information sharing with tax authorities.

Singapore will also be playing an active role in the Global Forum on Transparency and Exchange of Information, as the vice chairman of the Global Forum’s Peer Review Group. Singapore parliament has also given the nod for legislative changes that allows for exchanges of information with the tax authorities of other countries where specific information is requested. Although the legislative amendments allow for exchange of information it will not entertain any ‘fishing expedition’ whereby requests without substantial base or those that are frivolous will have to be avoided.

The finance minister also revealed plans of signing similar agreements with other countries thus sending a strong signal to the financial community and other governments that the city state endeavors to create a well regulated and responsible financial jurisdiction. It soon signed a DTA with Brunei which became 13th such pact. Singapore has signed similar agreements with Belgium, New Zealand, the UK, Denmark, the Netherlands, Australia, Austria, Norway, Qatar, Mexico and Bahrain.

In the emerging new world order Singapore strives to sustain its competitiveness and attractiveness for enterprises and investors to park their assets. Singapore has low tax rate, a thriving enterprise ecosystem, political stability, a pro business environment, high standard of living and also diligently ups its value proposition by promptly confirming to evolving economic environment.

The one-year tax exemption covers the remittance of all foreign sourced income earned or accrued outside Singapore on or before 21 January 2009 that is remitted to Singapore during 22 January 2009 to 21 January 2010 (both dates inclusive). Accordingly, the conditions required to be satisfied for the foreign sourced income to be exempt from tax when remitted will be lifted during this one-year amnesty period.

Singapore companies that have foreign sourced income earned or accrued on or before 21 January 2009 but maintained in offshore accounts in order not to attract income tax in Singapore would now be able to remit their foreign income free of Singapore tax during this one-year amnesty period.

Singapore overtook London as the investors’ preferred place for doing business. Singapore was chosen by 17 per cent of respondents who said it was the second best place for financial services two years from now.

London has slipped down from the second place due to the unfavorable tax policy being planned by the government and it is becoming difficult to raise credit because of the European Union’s regulations. Many hedge funds have left London because of a new top income-tax rate of 50 per cent for higher earnings. The survey reveals that US, Europe and Tokyo are loosing the confidence of the industry.

Singapore does not levy tax on capital gains and this is especially attractive to the private wealth management industry. The Asian region has the highest savings rate and hence Singapore and Shanghai are growing in popularity as firms look for ways to tap the wealth that has accumulated in China and the rest of Asia.

Singapore offers the best of both world’s and an enterprise environment where start ups can flourish with supporting policies. The city state’s financial services industry has gained a respected image globally and serves as a thriving financial hub of Asia with most of the major financial institutions having their offices here. The country also allows free repatriation of earnings and has a wide network of avoidance of Double Taxation Treaties. Singapore is all set to rule the regional markets in the years to come.

The principal activities of SFRS are the manufacturing of pressure vessels and steel structures for use on ships.

Modus Operandi

Investigations revealed that SFRS set up 6 related companies in late December 2004 to abuse the tax exemption scheme for new companies under section 43(6A) of the Income Tax Act.
Investigations also revealed that there was no work or services performed by the 6 related companies for SFRS. The 6 shell companies had no employees except for the SFRS directors themselves. Nevertheless, SFRS included fictitious expenses amounting to $1,622,000 in its audited statements of accounts for the years 2004 to 2006. These comprised commission fees, technical consultancy fees, marketing consultancy fees, engineering consultancy fees and management fees. The said fees were for the work and services purportedly performed by the 6 shell companies. SFRS consequently under-reported its profits by the same amount of $1,622,000 in its income tax returns for the Years of Assessment 2005 to 2007.
Although the 6 related companies had reported the various fees as their income, each company paid a negligible amount of tax as the first $100,000 of their chargeable income was exempted from tax under the tax exemption scheme. Therefore, SFRS had abused the tax exemption scheme and used these 6 shell companies to lower its own tax liability.

The tax exemption scheme under section 43(6A) of the Income Tax Act, which took effect from Year of Assessment 2005, was introduced to support entrepreneurship and encourage growth of local enterprises. Newly incorporated companies can enjoy a tax exemption on the first $100,000 of normal chargeable income (excluding Singapore dividends) for the first 3 consecutive Years of Assessment from the year of incorporation. Starting from Year of Assessment 2008, newly incorporated companies can claim a further 50% exemption on the next $200,000 of normal chargeable income (excluding Singapore dividends).
The company’s managing director, Mr Gan Oh Boon assisted the company to evade tax and authorised the abuse of the tax exemption scheme.

An Errant Tax Agent’s Involvement

Investigations revealed that SFRS’ auditor, Mr Chng Chor Tong, had advised Mr Gan Oh Boon to set up new companies and charge expenses in the books of accounts of SFRS in order to make use of this tax exemption scheme. Mr Chng Chor Tong and his sole proprietorship, CT Chng & Co., was involved in the entire process of SFRS’ tax evasion – registering the 6 companies, preparing the management agreements between SFRS and the companies, creating invoices to support the fictitious expenses and making audit journal adjustments to post these expenses to the final audited statements of SFRS’ accounts.

Mr Chng Chor Tong was the first practicing certified public accountant in Singapore to be convicted of tax evasion. He was convicted on 28 April 2009 of evading tax on his income from his sole-proprietorship, CT Chng & Co, and was sentenced to 6 month’s jail and ordered to pay a penalty of $75,200.52. In addition, he paid $200,000 for compounding his offence of abetting one of his clients in the commission of a tax offence.

Omission of Benefits-in-kind

Investigations also revealed that SFRS’ managing director, Mr Gan Oh Boon had omitted employment income in the form of benefits-in-kind, made up of hire-purchase instalments for his private car and his other private expenses paid for by SFRS.

Mr Gan Oh Boon was convicted of negligently making incorrect returns by omitting benefits-in-kind amounting to $405,335 for the Years of Assessment 2004 to 2006. SFRS was also convicted of negligently giving incorrect information about Mr Gan Oh Boon’s tax liability by omitting the said benefits-in-kind from his Form IR8A for the same Years of Assessment.

Court Sentences for SFRS and Mr Gan Oh Boon

SFRS and Mr Gan Oh Boon were first charged in court on 16th January 2009 for 10 charges each. This morning, SFRS pleaded guilty to 2 charges under section 96(1)(b) and 3 charges under section 95(2)(b), and Mr Gan Oh Boon pleaded guilty to 2 charges under section 96(1)(b) and 3 charges under section 95(2)(a). The remaining charges were taken into consideration for sentencing. For the 5 charges, the Court

i) Sentenced SFRS to a fine of $24,000 and ordered it to pay a penalty of $988,933.58.
ii) Sentenced Mr Gan Oh Boon to a total of 2 weeks of imprisonment and a total fine of $8,000. In default of payment of the fine, the default sentence would be 6 weeks of imprisonment. He was also ordered to pay a total penalty of $988,933.58. In default of payment of penalty, the total default sentence would be 34 months of imprisonment.

Voluntary Disclosure

Taxpayers are encouraged to conduct periodic reviews of their income tax returns/declarations and disclose any error voluntarily. While IRAS believes the majority of taxpayers are compliant, some taxpayers could have been negligent or unaware of their tax obligations, thus resulting in mistakes.

The Agreement, which is Singapore’s 60th agreement for the avoidance of double taxation, encourages and facilitates cross-border trade and investment between Singapore and Russia through the lowering of tax barriers and the better definition of taxing rights between the two nations. The main provisions under the Agreement include the following:

a) Lower withholding tax rates are imposed on dividends, interest and royalties. The tax rate for interest and royalties is 7.5% while the following rates apply to dividends:

1. 5% (for corporate shareholders holding at least 15% of the share capital and has invested at least US$100,000 or its equivalent in other currencies);
2. 5% for the Government; and
3. 10% (for other shareholders)

b) Tax credit would be available for residents earning foreign-sourced income. In the case of dividends received from Russia, Singapore also allows tax credit on the underlying tax paid for the dividends (i.e. tax credit on the corporate tax on the profits out of which the dividends are paid) if there is at least 10% shareholding.

c) A building site, a construction, installation or assembly project, or supervisory activities connected therewith constitute a permanent establishment only if it lasts more than 6 months. The period threshold for furnishing of services is more than 3 months in any 12-month period.

Singapore Company Setup Requirements:

To set up a company, you need to have a minimum of one shareholder, one director and one company secretary. A shareholder may be a local or a foreign corporation or an individual. You must be a minimum age of 18 years to be appointed as a director.
 
At least one director and the company secretary must be a resident of Singapore.  Companies without a Singapore-resident director can appoint a nominee director. The shareholder can also act as director. If the Company has only a shareholder cum director, he cannot act as the company secretary. There is also a minimum initial paid-up share capital of $1. A company must have a registered address in Singapore.
 
Any Singapore-resident citizen, Singapore Permanent Resident or Singapore Employment Pass/ EntrePass/Dependant Pass holder can be a nominee director. A nominee director will not have any role in the company except to satisfy the statutory requirements of a local resident director for your company.

Marks that cannot be registered
The following are examples of the marks that cannot be registered under the trade mark law in Singapore:

Descriptive Marks
Marks which describe the goods and services of the business. For instance, marks that describe the quality (‘Super’ or ‘Best’), quantity (‘One dozen’), value (‘Cheap’), intended purpose (‘Cleaner’), or geographical origin.

Marks ‘Common to the Trade’
Marks which are signs or indications which have become customary in the trade. Some marks have become so well accepted that the term is used to describe the type of the goods or services in general, and no longer serves to distinguish the products offered.

Marks Contrary to Public Policy or Morality
Marks which are generally contrary to public policy or morality. For example, a mark that could promote immoral behavior cannot be registered.

Deceptive Marks
Marks that attempt to deceive the public. For example, marks that misrepresent the nature, quality or geographical origin of the goods or services.

Marks that are Identical to Earlier Marks
A trade mark will not be registered if it is identical with an earlier mark and the goods or services for which the trade mark is sought to be registered are identical with the goods or services for which the earlier mark is protected.

Marks that could Cause Confusion
A trade mark may not be registered if it is likely to cause the public to be confused under these circumstances:

• it is identical with an earlier trade mark and is to be registered for goods or services similar to those for which the earlier mark is protected;
• it is similar to an earlier trade mark and is to be registered for goods or services identical with those for which the earlier mark is protected; or
• it is similar to an earlier trade mark and is to be registered for goods or services similar to those for which the earlier trade mark is protected.

IPOS

The Intellectual Property Office of Singapore ( IPOS) provides public access to its records of trade mark applications and trade marks registered in Singapore Trademarks can be registered with manually or online and it can be registered locally in Singapore as well as in other countries. Cost of registering a trademark depends on the number of countries you wish to register it in .It is cheaper to register just in Singapore but the price is higher if it involves other countries .For registration in other countries IPOS charges in Swiss Francs according to the country in question.

Classification of Goods and Services

The scope of a trade mark registration is determined by the goods or services in relation to which the trade mark is registered. For the purpose of trade mark registration, Singapore uses the International Classification of Goods and Services according to the Nice Agreement to classify trade mark registrations.

The Nice Agreement is an international agreement on classification of goods and services of which Singapore is a party. This classification sets out the list of goods and services There are a total of 34 classes of goods and 11 classes of services.

The Nice Classification is used in more than 140 countries worldwide and in international applications for the registration of marks under the Madrid Agreement and Protocol.

Singapore is well known around the world as a multicultural, multi religious and multi racial harmonious island food paradise. Starting as a quiet, laid back fishing village, Singapore has grown exponentially to become of the most densely populated country in the world with a population of 4.8million living closely together in a land area of 224.5 square miles. Singapore has also become the richest country in South East Asia and one of the most developed countries in the world. It is no surprise then that Singapore has attracted various organizations ranging from the Fortune 500 companies, small and medium enterprises, educational institutions to news bureaus to form their place in Singapore’s business landscape. So why follow the footsteps of those who have established successful businesses? Why set up your business in Singapore? Why Singapore?

Here is AsiaBiz Top 5 reason why Singapore is a great place to set up your business.

A Favourable Business Climate
According to the Ministry of Trade & Industry (MTI), there is an estimated 6,000 Multi National Corporations (MNCs) in Singapore. Many of these MNCs have chosen Singapore as the prime location of their Asia Pacific headquarters due to its positive business climate. For example, the World Bank’s Doing Business 2009 Report ranked Singapore as the world’s easiest place to do business, ahead of New Zealand, United States and Singapore’s closest competitor, Hong Kong. The EIU Country Forecast published in February 2008 also rated Singapore as having the best business environment in Asia Pacific and third in the world. These rankings by independent bodies are reflective of the Singapore Government’s efforts in providing efficient public sector services that support the private sector growth.

World Class Transportation System
Singapore’s Changi International Airport has three heavily used terminals serving over 80 international airlines flying to more than 190 cities in 160 countries. Changi International Airport also handles more than 4,500 arrivals and departures weekly, 37.7 million passengers and 1.85million tonnes of air freight in 2008.

With the high cost of owning private transportation, public transportation is efficient, frequent and spans every far reaching corner of the island. Singaporeans flock to the 70 railway stations of the Singapore’s Mass Rapid Transit (MRT) system which has a daily ridership of 1.564 million. The two public bus companies with a fleet of 3,600 single and double decker air-conditioned buses transport nearly 3.12 million daily passenger trips safely to 295 routes island wide.

Highly Educated Workforce
Singapore boasts one of the most educated workforces in the world. Literacy rate stands at a formidable 96%. 89.6% of resident non students aged 25-39 have secondary or higher qualifications. A further significant testament to the huge importance placed on education, the Singapore Government invested S$7,298.1 million in education in 2008. This comes up to 25.5% of total government operating expenditure, making education the second highest expenditure after security and defence. In addition, Singapore’s two long established universities, the National University of Singapore (NUS) and Nanyang Technological University (NTU) also rank favourably on various university ranking surveys. For example, based on the respectable The Times Higher Education World University Rankings of 2008, NUS achieved the 30th spot while NTU is ranked 77.

Therein, businesses have a population of strongly qualified human resources they can count on to advance their companies to greater heights of excellence.

Extensive Support for Budding and Established Entrepreneurs
Singapore is a nation birthed from the blood, sweat and tears of pioneer entrepreneurs. Entrepreneurship is promoted in Singapore by the government rather passionately. In fact, there is even an elected Minister of Entrepreneurship, Mr Lee Yi Shyan. The Singapore government has provided various support systems for entrepreneurs such as lower tax rates, tax exemptions and numerous schemes to encourage individual business formation. There are also many non profit organisations such as the Spirit of Enterprise that is committed to honouring entrepreneurs, providing a network of support and organising events where likeminded individuals can meet and share ideas.

Clean and Efficient Public Sector
The public sector in Singapore has a reputation for being very supportive of private sector initiatives and growth. Numerous policies in various government agencies are created to ensure the private sector is not stifled by bureaucratic practices. In fact, Singapore was ranked as the least bureaucratic place for doing business in Asia by the respectable Political and Economic Risk Consultancy (PERC) agency. The IMD World Competitiveness Report 2008 also ranked Singapore 3rd in the world and 1st in Asia for having the least corruption in its economy. Corrupt practices by public officers are investigated by the Corrupt Practices Investigation Bureau (CPIB). Any malpractice identified is heavily subjected with disciplinary action, public attention in the media, fines and/or jail sentence.

However, there are also various statutory and administrative obligations involved. For example, all Singapore registered companies need at least one local director, company secretary, local registered address. This may seem overwhelming to new and even established businesses.

This is where Asiabiz Services come in. We take care of all the processes involved with the pre and post incorporation of your business. We can organize everything from bank accounts to office space to ensure your new company is able to operate efficiently and effectively from the start!

The Asiabiz Services team consists of a group of professionals who have extensive experience with Singapore’s legal, financial, tax, corporate and regulatory frameworks. Our executive team has over 15 years of relevant professional experience.

Why Engage Asiabiz Services?

We understand that your business is unique and has its own special and unique requirements. Our job is to help you get the right package for your company so you can start trading legally in Singapore.

We are a company of passionate individuals. We are first and foremost passionate about Singapore. We truly believe Singapore is a city of possibilities and great opportunities. We are behind your goals of forming your business in Singapore.

We want to make things easy for you. We want you to concentrate on building your company and working towards your strategic vision. So let us help you comply with the various statutory compliance and administrative obligations.

Our fingers are on the pulse of change! We are obsessed with details, details, details! We keep up to date with all the latest statutory changes so you do not have to. We will help lead you through the rules and regulations governing the processes involved in starting a company in Singapore.

Our extensive experience allows us to give you specialist recommendations on the route that is best for you. Cannot decide if an EntrePass or Employment Pass is best for you? Should you set up a branch or representative office of your international company? Let us give you the advice.

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The marking of goods for various purposes, including identifying them from those of other traders, dates back to ancient times. Similarly, the existence of rules governing the use of such marks goes back to the medieval craft guilds.

By the 19th century people began to think of marks, which had become distinctive of a trader’s goods, and so attracted valuable goodwill, as a type of property. In the middle of that century, the right to take action in the courts against infringement of a trade mark came about, even when there was no intention to deceive on the part of the infringer.

The usefulness of such an action was, however, limited by the need for a trader to prove that the mark concerned was in fact capable of distinguishing his goods, and belonged to him. Several archaeological testimonies highlight how craftsmen usually branded their productions to give them, in some way, a distinctive sign. Nevertheless, the characteristics of modern trademarks went through a long process of evolution.

In the middle age the corporations had both the monopoly on sales and the distinctive symbol of their productions. In other words, they did not allow craftsmen to develop their own “signature”.

Then, with the Industrial Revolution, the issue on using signatures as a trademark did not only preoccupy the merchants but also the industrialists.

Subsequently, the promotion and publicity of trademarks were supposed to give an image and a modern value to their concept.

First legal framework and further legislation

The first trade mark registry was established in 1875. Trade mark law was consolidated in 1883, and the trade marks act of 1905 gave the first statutory definition of a ‘trade mark’. 1938 saw further legal changes, which had major effect on trade mark registration.

Amendments to the 1938 Act by the Trade Marks (Amendment) Act 1984 introduced the registration of service marks in respect of services such as laundries and banking. The Patents, Designs and Trade Marks Act 1986, and the Copyright, Designs and Patents Act 1988 made further amendments, which made the forgery of a trade mark a criminal offense.

Today, the trademark is becoming one of the most representative demonstrations of modern age and its purpose changes into a social concept in which the consumer is identified.

The Federal Institute of Intellectual Property of Switzerland has its headquarters in Berne. Founded in 1888, it has always been in charge of matters concerning intellectual property in Switzerland. On 1st January 1996, it obtains the status of an autonomous public establishment so as to have its own legal personality and to be entered in the Register of Commerce.

WIPO (THE WORLD INTELLECTUAL PROPERTY ORGANIZATION)

The World Intellectual Property Organization (WIPO) is a specialized agency of the United Nations. Its objective is to develop a stable and accessible system of international intellectual property in order to reward creativity, to stimulate innovation, to contribute to economic development and to finally safeguard public interest.

The WIPO Agreement was concluded in 1967, attached to the member States’ mandate to promote the worldwide protection of intellectual property with the cooperation of these States and other international organizations, whose headquarters are in Geneva (Switzerland).
The World Intellectual Property Organization (WIPO) is one of the 16 specialized agencies of the United Nations. WIPO created in 1967 “to encourage creative activity, to promote the protection of intellectual property throughout the world.”

WIPO currently has 184 member states, administers 24 international treaties, ] and is headquartered in Geneva, Switzerland. The current Director-General of WIPO is Francis Gurry, who took office on October 1, 2008. Almost all UN Members are Members of WIPO (non-members are the states of Kiribati, Marshall Islands, Micronesia, Nauru, Palau, Solomon Islands, Timor-Leste, Tuvalu and Vanuatu, as well as the entities of Palestinian Authority, Sahrawi Republic, and Taiwan).

The Madrid system for the international registration of marks, also known as the Madrid System, is the primary international system facilitating the registration of trademarks in multiple jurisdictions globally. The Madrid system provides a centrally administered system of obtaining a bundle of trademark registrations in separate jurisdictions. Registration through the Madrid system does not create an ‘international’ registration, as in the case of the European CTM system, but creates a bundle of national rights, able to be administered centrally. Madrid provides a mechanism for obtaining trademark protection in many countries around the world, which is more effective than seeking protection separately in each individual country or jurisdiction of interest.

Madrid now permits the filing, registration and maintenance of trade mark rights in more than one jurisdiction, provided that the target jurisdiction is a party to the system.) The Madrid system is administered by the International Bureau of the World Intellectual Property Organization (WIPO) in Geneva, Switzerland.

INTELLECTUAL PROPERTY OFFICE OF SINGAPORE

The Intellectual Property Office of Singapore (IPOS), is a statutory board under the purview of Ministry of Law.Since April 2001, it is the lead government agency that advises and administers intellectual property (IP) laws, promotes IP awareness and provides the infrastructure to facilitate the development of IP in Singapore.

As IP regulator and policy advisor, IPOS maintains a robust and pro-business IP regime for the protection and commercial exploitation of IP.

Singapore has a completely developed Trade Related Aspects of Intellectual Property Rights(TRIPS)-compliant Intellectual Property Rights(IPR) legislative and administrative regime. It is a signatory to the following international conventions pertaining to Intellectual Property

• Paris Convention
• Berne Convention
• Madrid Protocol
• Nice Agreement
• Patent Cooperation Treaty
• Budapest Treaty
• WIPO Copyright Treaty
• WIPO Performances and Phonograms Treaty
• International Convention for the Protection of New Varieties of Plants otherwise known as the “UPOV Convention”
• The Geneva Act (1999) of the Hague Agreement concerning the International Registration of Industrial Design
• Singapore Treaty on the Law of Trademarks

IPOS administers the following legislation:

• Copyright Act (Cap 63)
• Geographical Indications Act (Cap 117B)
• Layout-Designs of Integrated Circuits Act (Cap 159A)
• Patents Act (Cap 221)
• Trade Marks Act (Cap 332)
• Registered Designs Act (Cap 266)
• Plant Varieties Protection Act (Act 22 of 2004)

On the policy front, IPOS works with economic agencies and the IP business community to formulate and review IP policies and practices. IPOS’ work has become increasingly important in leading negotiations on IP issues in Singapore’s growing network of Free Trade Agreements with other countries.

Singapore on the Law of Trademarks

The modern Singapore Trademark Act was passed in 1998 under the Paris Convention for the Protection of Intellectual Property. Trademark registration in Singapore is handled by the Intellectual Property Office of Singapore (IPOS) – a statutory board under the purview of Ministry of Law.  

The Singapore Treaty on the Law of Trademarks was adopted in Singapore on March 27, 2006. It entered into force on March 16, 2009, following the ratification or accession of ten countries, namely Singapore, Switzerland, Bulgaria, Romania, Denmark, Latvia, Kyrgyzstan, United States of America, Republic of Moldova, and Australia. The treaty establishes common standards for procedural aspects of trademark registration.

What is a Trademark?
Trademarks are names, symbols or logos used to identify the origin of some product or service. A Trademark is a word, phrase, symbol or design, or a combination thereof, that identifies and distinguishes the source of the goods of one party from those of others.

What is a Copyright?
A Copyright is the protection that is afforded a work that is fixed in a tangible medium. Copyright laws grant the creator of the “work” the exclusive right to reproduce, prepare derivative works, distribute, perform and display the work publicly. In Singapore copyrights are protected just by copyright reservations and there is no single body that prosecutes for copyright infringements though there is a copyright tribunal where you can air your grievances if any.

Automatic Protection
An author automatically enjoys copyright protection as soon as he creates and expresses his work in a tangible form. There is no need to file for registration to get copyright protection in Singapore.

What is not protected by Copyright?

• ideas (e.g. a new business idea that has not been documented);
• concepts (e.g. an idea for a new game show that has not been written down);
• discoveries (e.g. a research finding that has not been known before);
• procedures (e.g. the steps involved when applying for a travel visa);
• methods (e.g. the unique solution to a mathematical problem);
• subject matter that has not been made tangible in a recording or writing (e.g. a speech or a dance that has not been written or recorded); and
• subject matter which is not of original authorship (e.g. works which contain information in the public domain such as standards and the like).

Why register a Trademark?
It is not mandatory to register a trade mark in Singapore. However ,if you register a trade mark it grants the owner of the trade mark a statutory monopoly. If anyone else uses the same or a similar mark on the same or similar goods or services in respect of which the mark is registered, the registered trade mark owner can rely on his registration as proof of his right to the mark and sue for infringement. Examples of trademarks are brand names like “ Prada”, “ Gucci” and “Georgio Armani”.

A registered Trademark bestows the exclusive use of that name, and provides for its owner the capability:

• To offer licenses and franchises.
• To be differentiated from competitors.
• To be protected from third parties using an equal or similar name, exercising the legal actions that correspond.
• To protect the Internet domain name.
• To impede others attempting to register similar trademarks.
• To have priority over third parties wanting to register their trademarks, in countries which do not require registration.
• Singapore wants to encourage inventors to patent and commercialize their inventions. This scheme helps cover some of the costs of filing patent applications.

PROCEDURE

The procedure is firstly to conduct a trademark search on the name, symbol or logo and then to register it under the one or many classifications that are available. classes under which goods may be registered are numbered from class 1 to 34 under the International Classification of Goods and Services generally referred to as the “ICGS”. The classes under which services may be registered are numbered from class 35 to 42. Processing time usually takes from 6 to 18 months.

A nominee director is someone in layman’s terms who is renting his or her name to the company. In other words, the name of this person is used for the incorporation documents. They are also taking the position on paper of the company’s directors. The term “front man” has been used to describe someone who is acting as the nominee. In essence his function is to shield working executives of limited and other companies from the public disclosure requirements that exist in Singapore .It is a perfectly legal device which preserves the privacy of an individual designed to help a person who would rather not disclose their interest or association with a given corporate body. Anyone performing a company search on a company with a nominee director would be unable to discover in whose name the nominee director was registered.

The Nominee director is appointed to the board much like any other director. The difference is that he or she is appointed quite openly , usually at the request of a third party to look after its interests. The person who appoints could be a creditor, or an equity investor – a venture capitalist or possible even the majority owner. The company could be dealing with pharmaceuticals, garden centers, import/export of food stuff or financial services.

Obviously the question is to whom does a nominee director appointed for example by Mr X to sit on the board of a company -Y Pte Ltd owe his duties to? To Mr X or to Y Pte Ltd? There is clarity on this from a legal point of view from case law that the nominee director owes his duty to the company -Y Pte Ltd. It is wrong for the nominee to simply assume that since everyone knows he was appointed by Mr X to look after his interest that he can proceed to do just that. Being a nominee director comes with it a bigger responsibility and a paramount duty which is to the company. By being a nominee director he comes within the ambit of assuming all the fiduciary duties owed by any director of the company. He is in a position of trust and confidence and what comes immediately to mind is his duty to exercise independent judgment, the duty to avoid conflict of interest and the duty to promote the success and best interest of the company as opposed to the appointer .

Section 157 of the Singapore’s Companies Act Chapter 50 provides the duties and liabilities of the company and a nominee director comes well within this ambit. A case that endorses point is W&P PILLING PTE LTD (in liquidation) VCHEW YIN WHAT &ORS (2007)4 SLR 218 (2007 7SGHC 24. The Court explained that he law makes no distinction between a fiduciary duties owed by different categories of directors. A nominee director owes the same duties to a company as any other director. A defense for the breach is provided under Section 39(1) of the Companies Act. In summary the act provides a defense for any default of breach of duty if the director had acted honestly, reasonably and had acted so having regard to all the circumstances of the case then the Court may excuse or relieve the director wholly or partly as the Court thinks fit.

In Singapore, all Singapore Private Limited Companies must have at least one director to be ordinarily resident in Singapore which includes

1. Singapore Citizens
2. Singapore Permanent Residents
3. Singapore Employment Pass/EntrePass/Dependant pass holder

It is interesting to note when foreigners incorporate a company in Singapore and need a local ordinarily resident nominee director for incorporation of the company in Singapore the nominee director is in relationship of trust with the company and not with the person who authorizes him. By virtue of the Singapore’s Company’s Act CAP 50 the nominee director takes on the responsibilities of owning all his fiduciary duties to the company in question which requires him to act in the best interest of the company. Once the nominee director is removed his function and duties end there and then. Usually it is when he authorizer has had his immigration requirements met by the Singapore authorities.

The Standards, Productivity and Innovation Board (SPRING) of Singapore assess the Business Plan to determine the viability of the proposed venture. Therefore it is important to understand the key aspects that need to be effectively addressed in the plan in order to be successful.

SPRING as the nation’s enterprise development agency for growing innovative companies and fostering a competitive SME sector reviews every proposal for its commercial viability. Therefore it is important to illustrate that there exists an inherent or potential need for the product or Service which your business intends to promote. The evaluation of the market must be realistic and the management must demonstrate a well though out Plan of Action and an ability to tap the opportunity.

The business idea should not be mundane it must justify the need for the applicant to be personally present in the country to manage the business. One of the undercurrent objectives of the Entrepass is to foster innovation irrespective of nationality of the promoter. Singapore as an enterprise hub welcomes and nurtures innovative ideas so that they can be successfully commercialized. Therefore, a business that involves the application of innovative technology or complements any existing technical innovation, or contributes to the growth of innovations stands a better chance of approval.

The plan must clearly demonstrate a sense of undivided commitment to grow the business. This means that a long term visionary approach needs to be adapted in assessing the market of its impending risks, competition and allied opportunities for growth. The plan must comprehensively enlist the milestones that the business intends to accomplish in a short term and in the long term.

The Plan must also express the significance of locating the business in Singapore. The logic for choosing Singapore to conduct the business should be convincing. Singapore as an Island state is a small market, but has immense potential to serve as a base for the regional markets, therefore if the business is also regionally relevant, the government will be enthused to support a venture with expansion prospects.

Last but not the least the inherent economic benefits that the proposed venture can bring to the country are of utmost importance. The plan should reveal how it is likely to create more employment opportunities, bring synergies to the existing enterprises by drawing intellectual and financial investments, create or fulfill a demand in the enterprise ecosystem, add to and amplify the vibrancy of the business or even cultural environment, magnify the spirit of learning, innovation and service.

The Business plan must essentially be built around a unique and lucrative business idea. The potential investors must effortlessly identify the value of the idea. The plan must also demonstrate a well thought out action plan to leverage the idea and how the management team is qualified to accomplish the plan of action. An inherent part of the business plan is the financial plan, clearly elucidating aspects such as the start-up capital, working capital, operational expenses and estimated net profit etc.

The Executive Summary is a précis of the entire Business plan namely the idea, the lucrative potential of the idea, the mettle of the management team and a glimpse into the financial highlights. Although it is the first section of document it is usually written after compiling all the other sections of the plan.

Discuss the idea in the Business/Company Summary. The vision and mission of the company must be clearly enunciated here. In this section it is important to reveal the gap/need existing in the market, how it can be fulfilled with the idea- which is essentially a service or a product and the size of the market that will willingly pay for such a product/service. Discuss the location of the business attention must be paid to how the location complements the idea in terms of near to market, supply chain efficacy, cost efficiency, regulatory terms and incentives, presence of a supporting enterprise ecosystem etc.

In the Startup Summary enlist the expenses in terms of capital equipments, leasehold improvements, licensing fees, deposits, marketing collaterals. Whenever finance is discussed always keep a comfortable cushion to accommodate inflationary impacts, miscellaneous expenses and other scenario like exchange rate fluctuations.

Explain the style of operating the business in the Nature of Business section, for instance, if it is a product business, explain how the service will be offered to the market – through direct sales or retailed via channel partners. The method of sourcing the product, that is, either by direct manufacturing, contract manufacturing or by other means. Explain the ideal pricing range, the cost of the product and margin earned by the business. The scheme of managing the channel partners etc.

Market Analysis is an essential element of a business plan. This helps the promoters to have a comprehensive understanding of the market. The market analysis must reveal aspects such as the size of the potential market, the viable market, the strengths and weakness of competitors, the unique proposition of the proposed venture, the potential risks and threats that will impede the business growth or its profitability etc.

Marketing Plan should outline the communication strategy of the venture – how they will reach the target market, how they will achieve visibility and credibility for their product/service. Media vehicles that will be deployed to achieve the marketing objectives should also be planned and enlisted in the plan to arrive at a fair estimate of the marketing expenses.

Management Summary is a synopsis of the company’s key executives’ experience, area of expertise and respective responsibilities. A projected organizational chart in line with the company’s vision could also be drafted in this section.

Financial plan must encapsulate at least 3 years of revenue, expenses and net profit projections. This section must first enlist the assumptions based on which the financial projections are surmised. Information on capital invested, creditors, debtors, loan repayment plan, stock planning and control, interest paid/earned etc have to be listed out. This will help you to project the Profit and Loss statement and Cash Flow statement. Break even Analysis and Balance Sheet must also be worked out.

Potential entrepreneur must realize that the exercise of drafting a business plan will streamline the thought process to arrive at a plan of action to lucratively exploit a potential opportunity. The process of drafting a business plan helps you to critically evaluate the idea and action plan to identify existing risks and weakness that need to be addressed in order to accomplish the mission.

Related Topics

• Incorporation 101 on Business Plan

The merchandise traders based in both the countries have immensely benefited from the CECA. In the Free Trade Agreement part of the CECA, all Indian-made products, with the exception of cars and tobacco products, are allowed duty-free entry into Singapore. Singapore based exporters will enjoy tariff elimination or reduction in 75% of Singapore’s domestic exports. An additional list of tariff concessions was released in January 2008.Recently in June meeting its other commitment under the CECA, India has reduced tariffs on 2,413 items. These can now be imported into India at tariff equivalent to 50 per cent of the most favored nation (MFN) applied rate. As for the 539 additional items, mostly manufactured products, on which India had taken newer tariff liberalization commitments in December 2007, the Finance Ministry has now taken the next step by slashing import tariffs in phased equal cuts for groups of products until 2015.

The general rule of origin for goods traded from Singapore is a combination of criteria – of the FOB value of the product at least 40% is accounted by local content and a change in tariff classification at the 4 digit level or satisfies product specific rules. CECA provides for a list of products which are exempt from the general rule.

Mutual Recognition Agreements (MRAs) are also being concluded to eliminate duplicative testing and certification of products in specific sectors, and facilitate bilateral cooperation in several sectors. These sectoral MRAs serve to reduce costs and shorten time to market. This is especially useful for products with short life cycle. Electronic and electrical and Telecommunication MRAs have already been concluded. Food Sector MRA covering egg products, dairy products and packaged drinking water from India, will immensely benefit the Indian suppliers while Singapore also benefits from an extended supply source for these products.

As regards services professional bodies of both the countries are discussing Mutual Recognition Agreement in the professions of accounting and auditing, architecture, doctors, dental and nursing. Both countries agree to provide a national treatment for service operators who will be given a level playing field in the sectors committed. For asset management services, Singapore owned or controlled fund managers have the additional privilege of offering Indian investors mutual funds and collective investment schemes (CIS) listed on the Singapore Exchange (SGX) as well as exchange traded funds (ETF). India has similarly lifted this limitation for India owned or controlled fund managers.

In the case of investment Singapore investors are not required to seek foreign investment approval for the sectors that India has committed. National Treatment is accorded to investors from both countries subject to the commitments (India) and reservations (Singapore) undertaken. Both countries will allow the investors to freely transfer funds related to their investments, such as capital, profits, dividends and royalties. The CECA chapter on investments accords National Treatment to investors from both countries. The market access feature of this provision is subject to the commitments and reservations undertaken. Both countries cannot expropriate investments, directly or indirectly, without proper legal safeguards. Expropriation must be premised on public purpose and compensation based on market value. Land expropriation will be governed by the domestic legislation of each country. In order to assure protection for investments once the investment is established, disputes can be taken to an international arbitration tribunal. Both countries allow the investors to freely transfer funds related to their investments, such as capital, profits, dividends and royalties. Capital gains tax exemption is a significant aspect of CECA, which fortifies the Avoidance of Double Taxation Agreement concluded between the two countries. The exemption is valid for companies listed in Singapore or India and companies with annual expense of at least S$200000 or INR 5 Million in the 24 months preceding the date from which such capital gains arise.

The cross-border movement of natural persons plays a central role in initiating and supporting trade and investments in goods and services. This CECA facilitates easier temporary entry for 4 categories of businesspersons from India and Singapore. Business visitors with five year multiple journey visa will be permitted to enter and engage in business activities for a period of up to 2 months, which upon request, may be further extended by up to 1 month. Short-term service suppliers will be granted temporary entry for an initial period of up to 90 days in the first instance. Professionals employed in 127 specific occupations will be allowed entry and stay for up to 1 year or the duration of contract, whichever is less. Intra-corporate transferees (i.e. managers, executives and specialists within organizations) will be permitted to stay and work in India and Singapore for an initial period of up to 2 years or the period of the contract, whichever is less. The period of stay may be extended for period of up to 3 years at a time for a total term not exceeding 8 years.

Thus CECA acts as a catalyst for accelerating bilateral trade, investment and economic co-operation and improves connectivity between India and Singapore not only for flow of merchandise and investment, but for the movement of professionals, talent and ideas as well.

Many global enterprises and wealthy individuals who are keen about their immaculate image are now in search of destinations that command a genuine reputation. This scenario and the growing investment opportunities in the East will entice investors and enterprises to Singapore which, though not a tax haven, has low tax rates. Singapore is now considering adopting an internationally-recognized standard for the exchange of tax information. Singapore endorsed the OECD Standard for Exchange of Information in March and local laws are being amended to comply with them. According to a statement from the Finance Ministry, Singapore has made substantial progress in implementing the standard. It does not envisage difficulty in meeting all requirements by March 2010, which is the deadline indicated by OECD for compliance. Once this is effective Singapore’s reputation as a wealth management hub will be reinforced.

Singapore’s headline tax of 18% on companies’ taxable income will be further reduced to 17% from YA2010. This will further entice the enterprises, but it is not the tax structure alone that attracts the enterprises into Singapore. The country commands several strategic advantages like its ideal geographic location in the burgeoning east yet proximate to the west, wide spanning FTA network, stable governance, efficient workforce and congenial and crime-free  environment, a thriving enterprise ecosystem and more than substantial economic interactions from manufacturing, services and trading sectors make it an enterprise hub. Thus we will witness more foreign companies setting up their base in Singapore.

It must be recalled that last year the report when released raised observations regarding the ability of Singapore to sustain its position in the coming years amidst the stiffening competition from economies like New Zealand and Hong Kong. But the city state has followed an adaptive regulatory policy to remain relevant and competitive and has successfully retained its lead position globally. Singapore has accomplished this in a year when economies around the world have revamped the regulatory framework to tide over the economic crisis.

Singapore has deployed IT to effectively implement its regulatory framework while ironing out the hurdles for businesses to establish and grow. Online services are available hence right from incorporation to closing down of business almost everything can be managed virtually. During difficult times regulatory hiccups is the last thing that businesses want to confront, Singapore has a adaptive approach and also scores well in terms of infrastructure, workforce efficiency, geographic location etc. Therefore in the present scenario where most of the enterprises are sprinting towards the East, Singapore will reign as the first choice for company setup. In the coming years too, Singapore will continue to review its regulations to ensure that it remains pertinent to the evolving business environment.

As per the Ministry of Manpower (MOM) Guidelines the applicant must have a minimum monthly salary above S$2500 and must have graduated from an institution of repute. Singapore welcomes foreign professionals with unique talents, in order to enrich the talent pool without jeopardizing the employment opportunities of the locals. Therefore applicants whose skills and experience add vibrancy to the talent pool and who can fill up those positions that are not contested for by the locals stand a better probability of being granted an EP.

There are three categories of Employment Pass: P1, P2 and Q1 Pass. The P Pass is for foreigners seeking professional, managerial or executive and specialist jobs.

• P1 Pass – for applicants earning a fixed monthly salary of more than $7,000.
• P2 Pass – for applicants earning a fixed monthly salary of more than $3,500 and up to $7,000 and he/she possesses recognized qualifications.
• Q1 Pass – for applicants earning a fixed monthly salary of more than $2,500 and he/she possesses recognized qualifications.

For Q1, MOM considers skills and experience in case of absence of paper qualification. While considering applications for EP, MOM matches the qualifications and skill of the applicants against a list of strategic skill set which is arrived based on consultation with various agencies and employers. The list reflects the demand forecast for specific skills in the current and future scenario. Applicants possessing such highly demanded skills will be given more credence during review. Apart from qualifications and skills the institution form which the applicant has graduated also plays a decisive role in determining the outcome of the application.

There is another pass called S Pass which was introduced to replace the previous Q2 Pass. It is designed for foreign nationals whose monthly basic salary is at least S$1800 or more. S Pass applications will be assessed based on a point system where some of the assessment criteria include the salary, education qualifications, skills, job type and also work experiences. For S Pass holder the employing company is liable to pay a levy.

Prospective applicants who are apprehensive about the outcome of the application may check the chances of approval using the online facility in the MOM website, Employment/S Pass Self-Assessment Tool. Employment Pass holders may also apply for dependent pass for spouse and children under 21 years of age.

Foreign talents with aspirations to work in Singapore may also apply for Employment pass Eligibility Certificate (EPEC) before commencing their job hunt in Singapore. This EPEC provides a prospective employer an assurance that if hired the candidate’s EP application will be reviewed favorably. The EPEC grants the holder up to a 1-year Social Visit Pass (SVP). Potential foreign talent holding acceptable tertiary/professional qualifications may apply for EPEC. The EPEC is issued on a one-time basis and is non-renewable therefore it is advisable to apply for an EPEC only when the potential talent is ready to come to Singapore for a job hunt.