Foreign Investment

There are no special laws governing foreign investment.

The following government bodies are concerned with the administration of investment matters generally:

• the Economic Development Board (EDB), which is responsible for the planning and promotion of industrial development in the manufacturing and service sectors, and the development and nurturing of small and medium-sized enterprises in Singapore. The EDB provides a number of services to industrial investors, including the evaluation of applications for tax and other incentives, assistance in seeking industrial land or suitable operational facilities and services for a quick start-up in Singapore, assistance in obtaining long-term project financing, locating suppliers, subcontractors and joint venture partners, and providing skilled personnel;
• International Enterprise Singapore (IE Singapore), which is responsible for developing Singapore’s international trade, and promoting Singapore as a centre of international trading activities and as a base for foreign business to expand into the region;
• the Standards, Productivity and Innovation Board (SPRING Singapore), which focuses on three main areas, i.e. productivity and innovation, standards and methodology, and small and medium sized enterprises and domestic sectors; and
• the Export Credit Insurance Corporation of Singapore (ECICS), which is responsible for the promotion of Singapore’s exports. The ECICS provides credit insurance protection to exporters in Singapore, guarantees to banks, either directly or by the assignment of claims, and bond issues support facilities to contractors and engineers.

Foreign investors may use any of the business forms to carry on a business in Singapore. A foreign company may also operate through a branch. The branch of a foreign company must have at least one authorized representative who is ordinarily resident in Singapore, i.e. a Singapore citizen, a Singapore Permanent Resident, or a person who has been issued an Employment Pass/Approval-In-Principle letter or a Dependant Pass.

A representative office of a foreign company must be registered with IE Singapore. The representative office cannot carry on business activities in Singapore, and may only engage in promotional and liaison activities.

Repatriation of income and capital

There are no restrictions on inward or outward remittances, whether income or capital.

No foreign exchange controls are currently enforced.

Since 1 June 1978, the operation of the Exchange Control Act has been suspended as a result of a circular issued by the MAS dated 25 May 1978. This circular exempts all persons from the provisions and obligations imposed by the Act, and abolished requirements for approval and any limits or restrictions in respect of all forms of payments or capital transfers.

However, banks have been requested to observe the official policy to discourage the internationalization of Singapore’s currency when they consider granting credit facilities to non-residents. Banks are also required to obtain MAS’s approval for granting Singapore currency credit facilities exceeding SGD 5 million to non-residents, or to residents where the funds are to be used outside Singapore.

No restriction is imposed on the foreign acquisition of:

• land in zones demarcated for industrial and commercial use; or
• residential flats or apartments in buildings of not less than six floors.

However, the Residential Property Act prohibits the acquisition or holding of other residential properties by foreign individuals and companies. Such properties can only be acquired and held by Singapore companies and citizens without restriction. A “Singapore company” is a company in which all the shareholders and directors are Singapore citizens.

Acquisition of residential properties by non-citizens and non-Singapore companies requires approval from the Land Dealings (Approval) Unit.

The employment of foreign workers is regulated by the Employment of Foreign Workers Act and the Immigration regulations. Workers who are not Singapore citizens or permanent residents must have valid work passes in order to take up employment or do business in Singapore.

There are no restrictions on the number of expatriate employees.