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Local director duties

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Michelle Lai
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Local director duties

Postby Michelle Lai » Sat, 08 Jun 2013 6:10 pm

Dear all,

I set up pte ltd company in singapore by engaged 1 local director to comply with law requirement and the other 2 is foreigner.

During signing section ie AGM paper the local director refuse to sign and said that 2 director will fulfills the Quaram as requested by law .

Question:
-Is that means that without signing any documents, he can run off duties as director ??
-can the audit report signed off by foreigner director

Thanks

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Strong Eagle
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Postby Strong Eagle » Sun, 09 Jun 2013 12:11 am

Statutory reports only require that two directors sign and yes, the foreign directors can sign.

If I were you, I'd get rid of this director. Get another one. And make sure that you have a signed, undated letter of resignation for the director. That way, if you run into problems like you are having with this one, you date the letter and the director has resigned.

You (the shareholders) can call for an EGM for the purposes of voting out you local director.

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Postby katbh » Sun, 09 Jun 2013 10:46 am

SMS - if it is your company and you are on an EP sponsored by the company, and you are resident in Singapore, do you still need a local director? I did not think so.

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Postby ecureilx » Sun, 09 Jun 2013 1:21 pm

Strong Eagle wrote:If I were you, I'd get rid of this director. Get another one. And make sure that you have a signed, undated letter of resignation for the director. That way, if you run into problems like you are having with this one, you date the letter and the director has resigned.

You (the shareholders) can call for an EGM for the purposes of voting out you local director.


+1 .. And get a replacement first ;)

katbh wrote:SMS - if it is your company and you are on an EP sponsored by the company, and you are resident in Singapore, do you still need a local director? I did not think so.


errr .. yes .. you still need a LOCAL Director .. either Local or PR

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Postby Strong Eagle » Mon, 10 Jun 2013 12:12 am

ecureilx wrote:errr .. yes .. you still need a LOCAL Director .. either Local or PR


This is not correct. What you need is an "ordinarily resident" director, that is, a person whose physical address is in Singapore. A PR or Singapore citizen who is not living in Singapore does not qualify to be an ordinarily resident director.

Once you have your EP and you have a physical address in Singapore, you can remove your nominee director and appoint yourself as director through an AGM or EGM.

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Postby katbh » Mon, 10 Jun 2013 7:27 am

Thought I would follow this up as it was pertinent to my future....

The Companies Act -

145.—

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ecureilx
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Postby ecureilx » Mon, 10 Jun 2013 9:42 am

Strong Eagle wrote:
ecureilx wrote:errr .. yes .. you still need a LOCAL Director .. either Local or PR


This is not correct. What you need is an "ordinarily resident" director, that is, a person whose physical address is in Singapore. A PR or Singapore citizen who is not living in Singapore does not qualify to be an ordinarily resident director.

Once you have your EP and you have a physical address in Singapore, you can remove your nominee director and appoint yourself as director through an AGM or EGM.


ah, I learn something new everyday .. :)

Anyway, with the tightened rules for PEP .. not many takers for the above option I guess ..

Michelle Lai
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Postby Michelle Lai » Tue, 11 Jun 2013 3:30 pm

Thanks for all replies.

But due to some business arrangement we have no choice by using his name as local director .

one more question does it means that without signing any document he can off duties and responsibilities as director ?? I believe NO right? because anything go wrong local authorities will locate him right ? Thanks

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Postby Strong Eagle » Tue, 11 Jun 2013 11:05 pm

Michelle Lai wrote:Thanks for all replies.

But due to some business arrangement we have no choice by using his name as local director .

one more question does it means that without signing any document he can off duties and responsibilities as director ?? I believe NO right? because anything go wrong local authorities will locate him right ? Thanks


Here's how it works. A director (or directors) are empowered to run the company. They can make virtually any decision they want to, except for those items that are spelled out in the Companies Act and/or the company articles of incorporation. Those decisions must be made by the shareholders at an AGM or EGM.

Therefore, if this director does not want to get involved in running the business, then the other two directors should do it. They can sign all the documents, and usually never more than two signatures are required, and in many cases only one.

Just because he doesn't want to sign anything doesn't mean he is not liable for the operations of the business. He has a fiduciary responsibility to ensure that the company doesn't do anything illegal or does not perform any act that could hurt the employees, the company, other companies, or customers.

If he fails to do this, and the company is charged with criminal violations or has civil lawsuits filed, he is still liable for prosecution even though he didn't sign anything simply because he has consented to hold the post of director.

In fact, if he is your "ordinarily resident" director, then notices will be served to him and probably your registered agent.

Michelle Lai
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Postby Michelle Lai » Wed, 12 Jun 2013 5:43 pm

Thanks so much SE


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