Despite the pandemic and tightened measures, it has evidently shown that international company incorporation in Singapore is continuing to grow. It is the central business and tech hub for many startups and international companies.
According to an article on Yahoo News, Amazon Singapore plans to create 200 jobs in the city-state by the end of 2022. The new office will accommodate up to 700 employees from over 30 teams.
Located at the heart of Asia, Singapore is home to the world’s top international companies across all industries. It has been consistently ranked among the top 20 countries by The World Bank due to its ease of doing business policies and is ranked the best when it comes to human capital development.
There are a number of reasons why Singapore is still the top country for international company incorporation in the Asia-Pacific region. Besides a solid infrastructure and having the double tax treaties with more than 80 countries to avoid double taxation, it also has one of the lowest tax rates in the world.
The government in Singapore has introduced 4 new initiatives to foster better economic growth recovery from the pandemic including incorporation:
1. New Digital Currency Scheme
The Bank for International Settlements (BIS) Innovation Hub has decided to partner with the central banks of Singapore, Australia, Malaysia and South Africa to conduct a trial of cross-border payments through the use of central bank digital currencies (CBDC) under “Project Dunbar”.
The main objective of this initiative is to develop technical prototypes of various distributed ledger technology platforms to handle multiple CBDCs in order to facilitate cheaper and faster cross-border payments without relying on intermediaries. The results of the trial will be announced by 2022 but this is definitely a good development for Fintech focused companies incorporated in Singapore and for future companies’ incorporation.
2. Easier Listing For Special Purpose Acquisition Companies (SPACs)
The Singapore Exchange introduced new rules on 2 September 2021 that allow Special Purpose Acquisition Companies (SPAC) to be listed in the country with effect from 3 September 2021.
SPACs are shell companies that allow fundraising through an initial public offering (IPO) to acquire an existing company. The minimum market capitalisation is reduced to S$150 million and allows investors to trade shares and warrants separately. This new framework provides an alternative route for promising and fast-growing companies, making it more attractive for regional investors.
3. Abolition Of Legalisation Requirement For Cross-Border Public Documents
The Hague Convention on apostillization came into effect for Singapore on 16 September 2021. The Convention provides a framework to help reduce time and costs for cross-border use of public documents.
An apostille is an official certificate that authenticates the origin of a public document. Apostilled documents are frequently required for company registration and incorporation, bank account opening and other legal purposes.
Currently, more than 100 countries are in support of the apostilled documents. Hence, incorporating a foreign company in Singapore becomes so much easier and faster as the need for various embassy legalisations is removed which differ from country to country. Apostilled documents can be presented in any member country and are accepted as legitimate documents.
4. Startup Cooperation Between Singapore And Estonia
Due to common interests between Singapore and Estonia, a new memorandum of understanding was signed by representatives of both countries on 6 September 2021. This provides for greater cross-border collaboration between startups in the cybersecurity industry.
Both countries have committed to sharing their expertise and knowledge in cybersecurity, protection of confidential information and participation in cyber threat-related operations.
Singapore is seen as the main gateway to Asian market penetration hence the many international company incorporations. Estonia is keen to learn more about Singapore’s experience in the digitalisation of government sectors and “SMART” nation initiatives.
In summary, the solid infrastructure and legal system, low tax rates and business-friendly initiatives are some of the core reasons that continuously make Singapore the top country for international company incorporation.