Companies Act can be defined as the legal act that regulates the formation, dissolution and management of companies. It differs from Country to Country. No company can be established without following the norms set by the law. Given below is a brief comparison between Singapore and China.
Singapores Companies Act came into force in 1967. Any business that has more then 20 employees is termed as a Company. Companies in Singapore are governed by the Companies Act (Cap 50, 1994 Rev Ed.). Certain companies in addition to the Companies Act are also governed by other Acts. Example, Banks and Insurance companies are also governed by the Insurance and Banking Acts.
China is currently ranked the 4th largest economy in the world. The World Bank however classifies China as a low-middle income economy.
Given below is a comparative study for setting up a business in Singapore and China.
Requirements for setting up a company
Singapore
Minimum one shareholder
Minimum one director who is the citizen of Singapore
One Company Secretary who is the resident of Singapore
Registered office address
Shareholder and director cannot be the same person
China
Minimum one shareholder
Minimum one director
Director and Shareholder need not be the citizens of China
Registered office address
Minimum paid-up capital of US$4175 needs to be paid
Types of Companies that can be formed
Singapore
Sole-proprietorships/Partnerships/Limited Liability partnership
Private limited company
Public limited companies
China
Branch Office
Sino-Foreign Equity Joint Ventures
Sino-Foreign Co-operative Joint Ventures
Wholly owned Foreign Enterprise
Chinese holding company
Procedure and Timelines for Company Registration
Singapore
Get company name approval
Prepare registration documents
Client to sign company registration documents
Register company
Open bank account
Memorandum and Articles of Association
Statutory Declaration of Compliance
Particulars of Shareholders, Directors, Secretaries, etc.
Certificate of Identity
Situation of Registered Office/Office Hrs at Time of Registration
Consent to Act as Director and Statement of Non-disqualification to Act as Director
A Consent to Act as Secretary
Time taken to register the Company is normally 1 day.
China
Choose Company Name
Open preliminary bank account, deposit fund and obtain certificate of deposit
Get capital verification report form auditing firm
Get registration certificate
Make company seal
Get organization code certificate given by Quality and Technology Supervision Bureau
Register with local statistics and tax bureaus
Open formal bank account and transfer registered capital to that account
Apply for authorization to print financial invoices
File for recruitment registration with a local career centre
Register with social welfare insurance centre
Time taken to register a company in China is usually 1 month
Advantages of doing Business in Singapore
Singapore has extensive tax-treaties with other countries
English is a common language
Taxes are only on the income sourced within or that is remitted into Singapore from a foreign source
It has a one-tier corporate tax system
Disadvantages of doing business in China
China is not a free market economy
Chinese often prefer to deal with the locals
Local language is predominantly used compared to English
