IMPOSING A REQUIREMENT ON FOREIGN COMPANIES OWNING PROPERTIES IN SINGAPORE TO DISCLOSE ITS CONTROLLERS

Murali Pillai
3 min readDec 14, 2022

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In the October 2022 sitting, I filed a PQ with the Minister for Law asking whether his Ministry will require overseas entities wanting to buy, sell or transfer properties in Singapore to register with ACRA and disclose the beneficial owners and principal officers of the entities. This is in keeping with the practice of financial centres overseas, such as UK, which introduced these measures to fight money-laundering. In her reply in Parliament, SPS Rahayu pointed out that ACRA already requires overseas entities to file information on registrable controllers. After reviewing her answer, I noted that this is not the case for all overseas entities. Section 366(2)(I) of the Companies Act 1967 precludes overseas entities which merely holds properties in Singapore from providing details of beneficial ownership. I therefore pursued the matter by asking if this provision will be reviewed. In his answer, DPM Lawrence Wong felt that the current approach reflected in the provision is a calibrated one that strikes a balance between regulatory compliance and ease of doing business. He also pointed out that there are other safeguards. My PQ and DPM Wong’s answer may be accessed below.

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Mr Murali Pillai asked the Deputy Prime Minister and Minister for Finance whether the Ministry will review section 366(2)(i) of the Companies Act 1967, under which foreign companies are not to be regarded as carrying on business in Singapore for the reason only that in Singapore it invests any of its funds or holds any property and therefore not subject to registration requirements under the same Act, to ensure that these companies are also subject to disclosure requirements pertaining to beneficial ownership and control as a safeguard against money laundering.

Mr Lawrence Wong: Under the Companies Act, a foreign company that carries on business in Singapore is required to be registered with ACRA and subject to various requirements under the Act, including but not limited to the disclosure of beneficial ownership information.

Section 366(2) of the Companies Act sets out a list of activities that, if undertaken by themselves, would not lead to the foreign company being regarded as carrying on business in Singapore. The list includes the investment of funds or the holding of property in Singapore. If the foreign company only engages in the activities on this list, it is not required to register with ACRA.

If the foreign company undertakes other actions with its funds or property that result in it carrying on business in Singapore, it must register with ACRA and be subject to the requirements under the Companies Act.

This is a calibrated approach to strike a balance between regulatory compliance and ease of doing business. In doing so, we have nonetheless ensured that there are other safeguards in place to deter money laundering and make information on ownership and control of foreign companies available to our law enforcement agencies.

For example, the beneficial ownership information of any entity that invests its funds or engages in property transactions, such as buying or selling real estate in Singapore, would be captured by relevant intermediaries. These include financial institutions and professionals (such as real estate agents and lawyers) when they establish business relations or undertake transactions for their customers. Law enforcement agencies in Singapore have the power to obtain information from these intermediaries.

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Murali Pillai
Murali Pillai

Written by Murali Pillai

Member of Parliament, Bukit Batok SMC, Advisor to Bukit Batok SMC GROs.

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