Foreign investment is actively encouraged, and the government does not object to the acquisition by foreign investors of an interest in Singapore enterprises. However, as a financial centre, Singapore is keen to uphold high standards of conduct on the part of companies operating there. Furthermore, the government is especially concerned to ensure that the rights of minority shareholders are adequately protected.
Singapore is a member of the WTO (World Trade Organization), the Commonwealth, ASEAN (Association of Southeast Asian Nations) and APEC (Asia-Pacific Economic Cooperation).
The legal system in Singapore is based on English common law. Generally, the organization of corporate business entities in Singapore is regulated by the Business Registration Act and the Companies Act. Both Acts are administered by the Ministry of Finance through the Accounting and Corporate Regulatory Authority (ACRA). Banks, finance companies, insurance companies and stock-broking companies are regulated by the Monetary Authority of Singapore (MAS). Legal services are regulated by the Legal Services Regulatory Authority.
There is no special approval procedure for investment. However, approval is required in the following cases:
• banks and financial institutions, which are regulated by the Banking Act and the Finance Companies Act;
• insurance companies, which require a special licence from the Minister of Finance;
• retail trade and shipping activities;
• newspapers which require a special licence from the Minister of Culture; and
• the manufacture of goods listed in the Control of Manufacture Act, which require a special licence from the Registrar of Manufacturers.
Factories must be registered under the Factories Act.
Every local company with a paid-up share capital of SGD 0.5 million or above, and every foreign company with an authorized share capital of SGD 0.5 million or above which is registered with ACRA is required to become a statutory member of the Singapore Business Federation (SBF). The SBF acts as an intermediary between the government and businesses in Singapore to promote a conducive business environment.
