New Requirements To Lodge Information On Singapore's Register Of Registrable Controllers Deferred To July 2020: ACRA.
Legal News & Analysis - Asia Pacific - Singapore - Regulatory & Compliance
22 May 2020
All companies incorporated in Singapore are required to file and maintain certain information and registers with the Accounting and Corporate Regulatory Authority ('ACRA'). The profile information that each company maintains with the ACRA can be purchased by anyone for a nominal fee. Such profile information includes the name and contact address of each of the company’s shareholders, officers, and directors.
2017: Introduction of the RORC initially as a private register
From 31 March 2017, all companies, foreign companies and limited liability partnerships incorporated or registered in Singapore ('Singapore Relevant Entities') are also required, unless exempted, to maintain and keep updated a Register of Registrable Controllers ('RORC'). The RORC is a private register to be kept by the Singapore Relevant Entity at its registered office (or at the registered office of its registered filing agent ('RFA')). It is not made available to the public but shall be available for inspection upon request by public agencies in Singapore (for example, the Commercial Affairs Department, the Corrupt Practices Investigation Bureau and the Inland Revenue Authority of Singapore). Certain entities such as listed companies and Singapore financial institutions, and their respective wholly-owned subsidiaries, are exempted from the RORC requirement.
July 2020: RORC now required to be lodged with ACRA with limited access rights
From July 2020 (the ACRA has deferred the implementation date from May to July in light of the Covid-19 situation), all Singapore Relevant Entities shall be required, unless exempted, to lodge information on their RORCs with the ACRA via the ACRA’s business filing portal, BizFile. This is as part of ongoing efforts to uphold Singapore’s reputation as a trusted financial hub, and is in line with international practices.
While the information lodged on the RORCs with the ACRA will still not be available to members of the public, the information on the RORCs will now be accessible online by public agencies in Singapore. As such, entities will no longer be notified through request when any public agency accesses and views their RORCs. The obligation to keep the RORC current and updated is therefore all the more important to avoid any miscommunication. The maximum penalty for non-compliance of the RORC requirement is S$5,000.
Whose duty is it to lodge the RORC information with the ACRA?
It is the duty of each Singapore Relevant Entity to take reasonable steps to find out and identify its registrable Controllers and also to keep the RORC information up-to-date.
As all the Singapore Relevant Entities should already have the RORCs in place currently, they should verify and confirm that the information in their RORCs is correct before lodging that with the ACRA by July 2020.
After the first lodgment, unless there are changes to the existing RORC information (which should be updated within two business days), the Singapore Relevant Entities will not be required to lodge the RORC information with the ACRA annually.
Alternatively, a RFA (for example, corporate service provider) may be appointed and authorized to lodge or update the RORC information with the ACRA on behalf of the Singapore Relevant Entities.
What information is required to be included in the RORC lodged with the ACRA?
The RORC information required to be lodged or updated with the ACRA is set out below.
For registrable Controllers who are individuals, the prescribed particulars include:
- Full name;
- Aliases, if any;
- Residential address;
- Identity card number or passport number;
- Date of birth;
- Date on which the individual became a registrable Controller of the Singapore Relevant Entity; and
- Date on which the individual ceased to be a registrable Controller of the Singapore Relevant Entity.
For registrable Controllers that are corporate entities, the prescribed particulars include:
- Unique entity number issued by the Registrar of Companies, if any;
- Address of registered office;
- Legal form of the registrable corporate Controller;
- Jurisdiction where, and statute under which, the registrable Controller is formed or incorporated;
- Name of the corporate entity register of the jurisdiction in which the registrable corporate Controller is formed or incorporated, if applicable;
- Identification number or registration number of the registrable corporate Controller on the corporate entity register of the jurisdiction where the registrable corporate Controller is formed or incorporated, if applicable;
- Date on which the entity became a registrable corporate Controller of the Singapore Relevant Entity; and
- Date on which the entity ceased to be a registrable corporate Controller of the Singapore Relevant Entity.
If there is an error in the RORC information lodged with the ACRA, the lodger can update the information using the same transaction or lodge a Notification of Error with the ACRA if it is due to a typographical error.
Who are the Controllers to be included in the RORC?
The RORC requires accurate and updated disclosures of all 'Controllers' of the Singapore Relevant Entities. A 'Controller' is defined as an individual or a legal entity that has a 'significant control' over or a 'significant interest' in the company or foreign company.
A 'significant control' over a company or foreign company includes:
- an individual or legal entity who holds the right to appoint or remove directors who hold a majority of the voting rights at directors’ meetings;
- an individual or legal entity who holds more than 25% of the rights to vote on matters that are to be decided upon by a vote of the members of the company;
- any agreement with another individual or legal entity to always combine their percentage of voting rights so as to exceed more than 25% of the rights to vote;
- any nominee holding more than 25% of the rights to vote on an individual or legal entity's behalf;
- the power to ensure that the company generally adopts the activities which the individual or legal entity desires; or
- absolute decision making and/or veto rights over decisions relating to the running of the business of the company.
A 'significant interest' in a company or foreign company having a share capital includes:
- an interest in more than 25% of the shares in the company; or
- an interest in voting shares with more than 25% of the total voting power in the company.
An 'interest in shares' includes some of the scenarios set out below (as a non-exhaustive list):
- a person (such as a beneficiary) who knows, or has reasonable grounds for believing, that he has an interest under a trust holding shares, shall be deemed to have an interest in those shares;
- a person who has entered into a contract to purchase shares shall be deemed to have an interest in those shares;
- joint owners of shares shall both be regarded as having interest in the jointly held shares;
- where a body corporate has an interest in a share and another person has a controlling interest over the body corporate, that person shall be deemed to have an interest in that share;
- where a body corporate has an interest in a share, and that body corporate is, or its directors are, accustomed or under an obligation whether formal or informal to act in accordance with the directions, instructions or wishes of another person, then such person shall be deemed to have an interest in that share;
- where a body corporate has an interest in share and a person and/or its associates are entitled to exercise or control the exercise of not less than 20% of the voting power in the body corporate, that person shall be deemed to have an interest in that share; and
- a person with authority (whether formal or informal, or express or implied) to dispose of, or to exercise control over the disposal of, a share (regardless of whether such authority is subject to any restraint or restriction) has an interest in that share.
A bare trustee shall not be regarded as having any interest in the shares held subject to such bare trust or nominee arrangement. However, where the shares are held subject to the terms of a discretionary trust, an actual review of the terms of such trust will be required to determine who shall constitute 'Controllers' with respect to the shares held on trust.
Entities exempted from the RORC requirement
As mentioned above, listed companies and Singapore financial institutions are exempted from the RORC requirement.
A Singapore financial institution refers generally to any financial institution that is licensed, approved, registered or regulated by the Monetary Authority of Singapore. As such, it does not include a single family office exempt from licensing requirements under the Securities and Futures Act (Cap. 289) or a private trust company exempt from holding a trust business licence under the Trust Companies Act (Cap. 336).
In the United Kingdom ('UK'), since June 2016, companies and limited liability partnerships are required to identify all persons with significant control over the entities ('PSCs') and file their details with the UK Companies House. The PSC Registers are publicly searchable by members of the public free of charge. The Organization for Economic Co-operation and Development ('OECD') has commended the UK's initiative of creating such a central public register as it believes that such open data helps to promote the objectives of reducing risks of illegal activities, controlling corruption and facilitating identification and sanctions where needed.
Singapore seeks to balance the need of law enforcement and other relevant public agencies to access the RORC information for prompt and effective supervision and control without overly compromising on the need of private citizens to maintain confidentiality over their wealth. For the time being, journalists do not appear to be within the class of persons with access to the RORC.
For further information, please contact:
Stacy Choong, Partner, Withersworldwide