EP rejected due to company

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Nycsing
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EP rejected due to company

Post by Nycsing » Wed, 02 Jun 2021 7:16 pm

EP was rejected as company did not have revenues for 2 years. However the company is a regulated financial services firm with high capitalisation. Has anyone experienced success on appeal where this was explained with clear data and plans? Plus support from MAS as the regulator

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sundaymorningstaple
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Re: EP rejected due to company

Post by sundaymorningstaple » Wed, 02 Jun 2021 8:31 pm

If it's to be successful, the employer must appeal. But it sounds pretty strange, like there is something the employer may not be telling you.
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Nycsing
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Re: EP rejected due to company

Post by Nycsing » Wed, 02 Jun 2021 8:40 pm

Why do you think it’s strange? Company was dormant for 2 years then got capitalized and fund management license. Rejection is because there was no revenue for 2 years and calling in doubt ability to pay salary.

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sundaymorningstaple
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Re: EP rejected due to company

Post by sundaymorningstaple » Wed, 02 Jun 2021 8:57 pm

Oh, yeah, I saw that "Company was dormant for 2 years then got capitalized" in your first post, didn't I......
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Re: EP rejected due to company

Post by Myasis Dragon » Wed, 02 Jun 2021 11:15 pm

Nycsing wrote:
Wed, 02 Jun 2021 7:16 pm
EP was rejected as company did not have revenues for 2 years. However the company is a regulated financial services firm with high capitalisation. Has anyone experienced success on appeal where this was explained with clear data and plans? Plus support from MAS as the regulator
As my alter ego, Strong Eagle, has posted many times, if you expect to get an EP out of a startup situation, you're going to need to provide a business plan and pro forma financial statements.

Yes, your EP application was rejected because you cannot demonstrate revenues to cover the salary levels. This is the most common reason I have seen for startup EP rejection.

Simply being well capitalized is insufficient. Why? Because every Tom, Dick, Harry, Abhishek, Mahindra, and Abdul with a sack full of money would create a Singapore company, capitalize it, then apply for an EP on the basis of capitalization alone, noting that salaries would be paid out of capital. No real business is in evidence, and Singapore is not about to open that door to immigration.

And that is your problem... lots of cash, no revenues... so how come no revenues? People don't generally dump cash into a startup without creating an active business... even if it operates at a loss to start, it is still creating revenue.

It is worth noting that Singapore doesn't grant EP's and startups to benefit the individuals making the application, it does so only if it believes that granting said EP will be of benefit to Singapore in general. If you're running a one person trading firm, maybe that will fly on the basis of technical expertise in finance, or maybe they just aren't very interested in one more finance person using Singapore as a place to trade. I don't know.

In any event, you will need the business plan. You'll need to demonstrate how you plan on earning the revenues needed to cover the salaries... your markets, your sales strategies. You'll need your pro forma's to show breakeven... when your expenses are covered by revenues, not capitalization. And the gahmen will use your pro forma statements to also determine if you have a realistic business plan. Unrealistic revenue projections, or net profit percentages outside normal expectations for businesses, will be viewed with suspicion, ie, made up numbers, with no real idea as to how they will be achieved.

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