According to the Singapore Companies Act, all companies incorporated in the city-state are required to have at least one shareholder. Shareholders are company members or, better said, are a company’s owners. Shareholders are individuals or legal entities that have invested a certain amount of money, a share capital, in order to receive a return of the investment that can take the form of distributions resulted from the company’s trading activities or in the form of growth in the value of the investment throughout time. Shareholders in Singapore companies limited by shares are individuals that have subscribed or purchased shares within the company. The most important role of shareholders of companies in Singapore is to raise capital.
The video below presents the main duties and powers of shareholders in Singapore companies:
Before opening a company in Singapore, investors should know that the shareholders of Singapore companies have certain privileges, among which the right to vote when appointing the board of directors, the right to propose certain resolutions and the right to distribute the company’s income. Shareholders are also entitled to purchase new shares when issued by the Singapore company and the right to remaining assets in case of company liquidation.
Compared to the Singapore company’s management, shareholders have certain powers. Among the powers of Singapore companies’ shareholders are:
Minority shareholders in companies registered in Singapore are generally required to accept the decisions of directors and the majority shareholders. However, they also have certain rights that protect them. The rights of minority shareholders are mentioned in the Companies Act, but must also be stated in the Memorandum or Articles of Association of the company. Foreign investors with a minority stake in a Singapore company usually negotiate specific rights when joining the company.
The most important rights granted to minority shareholders in the Commercial Code in Singapore are the rights to attend and vote at the general meetings. General meetings are required to be held on an annual basis according to the law. Singapore minority shareholders also have the right to vote in matters such as resolutions to pay dividends and election or removal of the company’s directors. Minority shareholders have the right to be treated fairly, most of all.
For complete details about the regulations of the Companies Act or for nominee shareholder services please contact our specialists who can also help you open a company in Singapore and can also offer you tax advice and planning.