The Companies Act 1967 has recently been amended to further strengthen the corporate governance regime in Singapore. The amendments were effected vide the Corporate Registers (Miscellaneous Amendments) Act 2022 and took effect on 30 May 2022.
Register of Nominee Directors
The Companies Act now mandates the timeline within which the register of nominee directors should be updated.
A “nominee director” is also defined in the Companies Act 1967 to mean a director who is accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of any other person. Especially for newly incorporated companies without any initial local presence, these individuals will typically be those who originate from service providers to assist such new companies in fulfilling the local resident director requirement.
The register of nominee directors is non-public, i.e. it is not open to the public for inspection, and unlike most of the other statutory registers, it is not an electronic register that requires lodgement with the Accounting and Corporate Regulatory Authority of Singapore (ACRA) although we expect this to change in the near future. Although this register is not lodged with ACRA, it needs to be maintained by the Company Secretary, and it has to be updated within seven days of any new fact or changes.
For instance, if a company appoints a new nominee director, the company will need to update the register of nominee directors within seven days of such appointment. Similarly, if there are changes to the nominee director’s particulars (e.g. residential address), the company is also required to update the register of nominee directors within seven days upon being informed of such change.
The appointment of a nominee director may appear to be a trivial matter meant to meet local residency requirements and may not be of prime concern to the management or operational team. However, ACRA has indicated its seriousness in levying fines for breaches. Defaulting on the requirement to maintain the register of nominee directors is an offence and may render the company and every one of its officers (i.e. each director and company secretary) liable to a fine of up to S$5,000.
Register of Members for Foreign Companies
Foreign companies are required to update any changes in the register of members within seven days of any new fact or changes with effect from 30 May 2022.
Foreign companies that have set up branches in Singapore would, in general, leave the administration of the branch to the local authorised representative. Changes in the particulars of the foreign company (name and address, for instance, flowing from any merger or acquisition) are rarely communicated to the local authorised representative. This has now been singled out by ACRA, and lapses will constitute an offence and may render the foreign company, and every one of its officers (even if non-resident) and the local authorised representative/s liable to a fine of up to S$1,000 and a default penalty.
Register of Nominee Shareholders and Nominators
The Corporate Registers (Miscellaneous Amendments) Act 2022 has also introduced a new statutory register that companies are required to maintain, although this has yet to come into force.
When these provisions come into operation in the near future, both local and foreign companies will be required to maintain a register of nominee shareholders and their nominators. The register will be non-public and companies will also be required to update the register within seven days upon being informed of any change by the nominee.
A “nominee shareholder” is defined in the Corporate Registers (Miscellaneous Amendments) Act 2022 to mean a shareholder who is:
(a) accustomed or under an obligation, whether formal or informal, to vote, in respect of shares in the company or foreign company of which the shareholder is the registered holder, in accordance with the directions, instructions or wishes of any other person; and
(b) receives dividends, in respect of shares in the company or foreign company of which the shareholder is the registered holder, on behalf of any other person.
Full list of statutory registers
With the above, the full list of statutory registers that a local company is obliged to maintain is set out below:
- Register of Members (electronic)
- Register of Directors (electronic)
- Register of Chief Executive Officers (electronic)
- Register of Secretaries (electronic)
- Register of Auditors (electronic)
- Register of Registrable Controllers (information to be lodged with ACRA)
- Register of Nominee Directors
- Register of Mortgages or Charges
- Register of Directors’ Shareholdings
- Register of Application and Allotment of Shares
- Register of Transfer Register of nominee shareholders and nominators (pending)
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Bird & Bird is a global law practice providing legal support to our clients on corporate transactions, policies and regulations, fund-raising, project management, intellectual property, technical and commercial contracts, sustainability issues and dispute resolution. We have a dedicated corporate secretarial practice in Singapore and are a registered corporate service provider/filing agent.
If you wish to discuss issues concerning the maintenance of your company in Singapore or have any queries, please do not hesitate to get in touch with any member of the Bird & Bird Singapore corporate team.
This article is produced by our Singapore office, Bird & Bird ATMD LLP. It does not constitute as legal advice and is intended to provide general information only. Information in this article is accurate as of 28 June 2022. Please contact the authors if you have any specific queries.
For further information, please contact:
Sandra Seah, Partner, Bird & Bird
sandra.seah@twobirds.com
