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[EP] Incorporating a company via an incorporating service

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yongfook
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[EP] Incorporating a company via an incorporating service

Postby yongfook » Tue, 15 Sep 2009 3:46 pm

Hi all,

I have a question for those who have experience starting their own businesses and getting an Employment Pass. Your advice will be much appreciated!

Specifically, has anyone used the services of a company called .?

I am currently not resident in Singapore and they provide a solution for people like me to register a company and get an EP - it sounds like it works like this:

1) They register the company with them as a nominee director
2) They apply for my EP on behalf of the new company
3) They "resign" as director and I take over as new director with my EP

Does that sound right?

My question...

Nothing seems guaranteed in the process - I am wondering how likely it is that MOM grants an EP for a foreigner to come and work for a young company with no records on file yet (P&L, tax etc). Has anyone gone through this and been successful?


For example: If I apply for a P1 employment pass for myself is the government going to be looking for a certain amount of paid-up capital to support this? How do they determine "yes this new company can sustain this new ang moh on XYZ type EP" ?

Many thanks in advance!

YF

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Postby Strong Eagle » Tue, 15 Sep 2009 10:18 pm

This seems to be the $64,000 question that seems to go around without resolution.

The scheme that you have described makes a mockery of the Entrepass scheme that Singapore has designed to qualify new business start ups in Singapore.

Why on earth would you go to the hassle of creating a business plan that has to be approved by government agencies when all you need to do is hire a nominee director, form a company, and have that company apply (and receive) and EP for you? You get to short circuit the whole process.

And without any bias to the company mentioned, I think it is crap. The demand of people from developing Asian countries to move to Singapore under any kind of pass is overwhelming. If this were actually possible then Singapore would be overwhelmed with Indian, Chinese, Vietnamese, Filipino, and every other nationality you can think of, starting a "business" with the express intent of getting residence in Singapore.

Having said that, there might be a couple of ways that this mechanism could work. First, you might already have a very successful track record in a business and you just want to transfer your business to Singapore. If you can demonstrate your track record without a business plan, this option might work.

Or, you may already have contracts lined up... a business ready to earn income the day it is incorporated. Again, you might make this work because you have income and a real business from the beginning.

But... to register a company through a nominee director... then file for an EP for a business that has not generated shit... I don't see how this happens... see above about flouting Singapore process for the Entrepass.

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Postby yongfook » Tue, 15 Sep 2009 10:53 pm

well that certainly confirms some of my suspicions!

Do you recommend I go via the entrepass route instead?

A bit of background:

1) I have started and sold one company in Tokyo
2) I've given talks at conferences in Singapore before, on my speciality (web)
3) I have a startup that is currently generating revenue and I simply want to transition the base of operations to Singapore, and live there
4) I have a degree in accounting from a UK university
5) Lots of press clippings and whatnot about me

I think I'm a pretty decent candidate for the entrepass, with 2 caveats:

1) I think business plans are bullshit - I've never used one and think they are a dinosaur concept for the kind of entity I run. If needed, I will suck it up and write one though.

2) One of the criteria for an entrepass is (I believe) how much capital you pump into your entity - correct me if I'm wrong. I'm not quite at the stage where I can drop S$1MM into a new venture - I need to keep things a bit lean for now.

Any suggestions?

and if I choose the entrepass route, is this something I can do entirely on my own or is it better to get an agent to help me?

Cheers
YF

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Postby yongfook » Tue, 15 Sep 2009 11:26 pm

Looks like the rules are about to change...

http://www.mom.gov.sg/publish/momportal ... epass.html

Company must have at least S$50,000 paid-up-capital


Hrrm. It's almost on par with the requirements for starting a company and getting a visa in Japan (where I currently live), which I always thought was a bit restrictive.

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Postby sundaymorningstaple » Wed, 16 Sep 2009 6:38 am

Hey SE, I'm wondering if they (MOM) have been reading you posts and thread with ksl! Looks like they are going to create a definite set of criteria now.

Yongfook,

Thanks for posting that link. I probably wouldn't have seen it until I returned from hols here in the US.

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Postby Strong Eagle » Wed, 16 Sep 2009 9:17 am

yongfook wrote:Looks like the rules are about to change...

http://www.mom.gov.sg/publish/momportal ... epass.html

Company must have at least S$50,000 paid-up-capital


Hrrm. It's almost on par with the requirements for starting a company and getting a visa in Japan (where I currently live), which I always thought was a bit restrictive.


Thanks for the reference. Entrepass rules have all of a sudden become much more draconian. I'm not sure that I could have qualified under the new rules since I hired mostly EP's and contracted out my accounting, legal, advertising, and administrative support (this has been a nightmare in Thailand where they want to see my office and the people in it).

It creates as many new questions as it answers. Chief amongst those questions is that if it now takes $50,000 for a foreigner to start up a business, then how can the scheme proposed by Rivkin unless they are operating under the assumption that ACRA/MOM doesn't look at businesses if registered by a Singaporean.

At this point I would ask Rivkin how their process works in light of the new Entrepass rules.

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Postby brittanny » Wed, 16 Sep 2009 9:33 am

in regards to company(ies) offering services n solutions such as ., i've known of such transactions both made and closed. it is commonly practised in thailand, msia and sg, n most of the times used by foreign companies to initially gain entry to conduct some form of business activities, n that esp if that country has a quota on foreign ownership

while such transaction is not illegal, n should u choose to use such solution, you also need to understand the basic criterias n obligations of owning a company (an exempt one if this company is owned by individual(s) only), such as updating and lodgement at ACRA and the filing of the annual AGM etc.. appointment of a company secretary is optional of course, n comes with a yearly fee.

please also do note the business activities this company is registered under ACRA, it is only prudent to ensure that the correct business activities is reflective n updated
Last edited by brittanny on Fri, 18 Sep 2009 2:21 pm, edited 1 time in total.

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Postby yongfook » Wed, 16 Sep 2009 10:25 am

brittanny wrote:while such transaction is not illegal, n should u choose to use such solution, you also need to understand the basic criterias n obligations of owing a company (an exempt one if this company is owned by individual(s) only), such as updating and lodgement at ACRA and the filing of the annual AGM etc.. appointment of a company secretary is optional of course, n comes with a yearly fee.

please also do note the business activities this company is registered under ACRA, it is only prudent to ensure that the correct business activities is reflective n updated


Pretty sure I understand.

The reason I want to start a company in Singapore is to start a company in Singapore, not as a roundabout method of getting an EP for myself.

I had it in my head that Singapore was going to be an easy place for me to get started but it looks like that isn't the case anymore.

So my options are either:

1) Entrepass route and whack down S$50k in paid up capital. But this isn't really an option right now.

2) Incorporate -> Nominee Dicrector -> EP route and exploit a legal "loophole" that may or may not be scrutinised harder by MOM by the time I apply.

It creates as many new questions as it answers. Chief amongst those questions is that if it now takes $50,000 for a foreigner to start up a business, then how can the scheme proposed by Rivkin unless they are operating under the assumption that ACRA/MOM doesn't look at businesses if registered by a Singaporean.

At this point I would ask Rivkin how their process works in light of the new Entrepass rules.


I haven't asked them yet but on the face of it I would assume it cripples one of their service offerings. They can't be offering a $3000 Entrepass application package with a footnote saying "by the way to be approved you'll also need to put $50k into your new entity kthxbai". I'll reach out and ask them for comment...

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Postby Strong Eagle » Wed, 16 Sep 2009 2:16 pm

yongfook wrote:I haven't asked them yet but on the face of it I would assume it cripples one of their service offerings. They can't be offering a $3000 Entrepass application package with a footnote saying "by the way to be approved you'll also need to put $50k into your new entity kthxbai". I'll reach out and ask them for comment...


Please post your findings here; they will most certainly be of benefit to many. I will also contact MOM... in the past, someone who had a going business (one man or otherwise) was a shoe in if he wanted to run the business here. Hard to believe they are making that go away.

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Postby yongfook » Wed, 16 Sep 2009 2:21 pm

Strong Eagle wrote:
yongfook wrote:I haven't asked them yet but on the face of it I would assume it cripples one of their service offerings. They can't be offering a $3000 Entrepass application package with a footnote saying "by the way to be approved you'll also need to put $50k into your new entity kthxbai". I'll reach out and ask them for comment...


Please post your findings here; they will most certainly be of benefit to many. I will also contact MOM... in the past, someone who had a going business (one man or otherwise) was a shoe in if he wanted to run the business here. Hard to believe they are making that go away.


That's what I would have thought too. Will report back with what they say.

In the meantime I am hurriedly collating documents to try to beat the September 28th deadline and submit the Entrepass by myself rather than going through a proxy agency.

Wish me luck!

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Postby yongfook » Thu, 17 Sep 2009 8:09 pm

ok I heard back from ..

Firstly, I asked them about how exactly a company with no records etc is able to issue EPs for foreigners and guarantee income:

If the new company is to apply for employment pass, we would normally suggest that the paid-up capital to be at least S$10,000/-. We have done
this for many client with newly set up company. Currently Entrepass
approval rate is quite low and if you are a degree holder and with relevant
work experience, it would be advisable to apply for Employment Pass rather
than EntrePass


The paid-up capital requirement makes a bit more sense and makes the whole process seem slightly more feasible. . doesn't really mention this on their website anywhere, though.

I then asked how the $50,000 paid-up capital requirement for the new Entrepass rules affects their $3550 Entrepass package:

http://www...com/Singapore-Company ... kages.html

And got this answer:

Our service offering will remain the same basically the changes in the
criteria for EntrePass are basically on the setting-up of Companies.


which doesn't make much sense to me since company incorporation is part of the package they offer for the Entrepass.

:? :? :?

At this stage I have nothing to "lose" so I'm going to pull a ukdesigner (been reading his posts) and just apply for the Entrepass myself before September 28th, from Tokyo, with S$40 in cash in the envelope(!) and see where that gets me...

Unless of course I get rejected and you're not allowed to apply again? That would suck. What are the rules regarding re-application? Can't seem to find anything on MOM.

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Postby jpatokal » Fri, 18 Sep 2009 2:02 pm

yongfook wrote:Unless of course I get rejected and you're not allowed to apply again? That would suck. What are the rules regarding re-application? Can't seem to find anything on MOM.

You can appeal failed applications if you have "new or additional information" to offer, and you can (AFAIK) place new applications as many times as you want.

http://www.mom.gov.sg/publish/momportal ... roval.html
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Postby ksl » Sat, 19 Sep 2009 1:33 am

I can only say that when i visited MOM to ask a few questions, I pretended to be someone i wasn't, because the case was one of objectivity. I retired many years ago has they should know...but why should i be inactive in my retirement, my job is to be innovative and make things from nothing. I produce results, no results no money, I make companies profitable and i can do it with very little capital and that is only because of experience and education I picked up on the way.

I never excelled at economics, because i go against the grain, statistics are bullshit, and politics are bullshit, they are both created to serve a purpose of indoctrination, because that's how governments work they have structures the majority must follow and those that do not follow get punished. Moving statistics to show results, anyone can do it. The rules are if you do not learn what is being taught, you fail! I have always lived in the real world since i walked the streets at 11 year old, I don't need bullshit in my life as a youngster, how often are governments failing the innocent and rewarding the con artists. Even here in Singapore were no welfare state exist it still happens. This is one great Country without a doubt, but what makes it great? History, and the fact it is of strategic value to the west and USA along with a commitment from those that care about the country. I can honestly say I care about Singapore because i see more happening here than anywhere else in the world.

Yongfook:which doesn't make much sense to me since company incorporation is part of the package they offer for the Entrepass.

Basically you setting up a company through a third party, means you are nominating a local director a Singaporean Citizen, PR holder or EP holder which is required for registration, which maybe the company offering the service or not, the rules of 50k paid up capital still apply, which you must fulfill before your company is incorporated.

Basically SE who is excellent at writing up a business plan could do the same for you and I am sure SMS could do the same if he wished to do it.
A business plan is very easy, and where people fail, is normally because of missing the main basic points of how they will make their business work.....commonsense and not dreams is the main reason. Only research and hard work will give you a slightest chance, to be a winner takes more input.

My advice if you are rejected, is to appeal and make an appointment, to justify your application in a convincing manner. Having seen the new Ltd Company requirements of 50k, I feel many Countries in Europe have this in place already, and even though it is an obstacle for new startups, there are some solutions available, always at a price I'm afraid.

One must never be negative, there are always loop holes in place, part of the package of controls, its all about balance rather than anything else.


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