Asiabizservices Publishes Page On Singapore Branch Office Versus Subsidiary Office 

“One difference that stands out between these two business structures is the legal personality,” says Asiabiz’s business consultant, “only the subsidiary office is cloaked with a legal personality as it follows a private limited structure.”

by Ashley Varghese Wednesday, April 20, 2011
As part of its professional specialization, Asiabiz Services provides Singapore company incorporation services for foreign investors and companies. Two business structures that foreign companies can choose to register in Singapore are branch office and subsidiary office.

Asiabiz created a page on its website a comparison on the branch office and subsidiary office in registration, features, and advantages.

“One difference that stands out between these two businesses structures is the legal personality,” says Asiabiz’s business consultant, “only the subsidiary office is cloaked with a legal personality as it follows a private limited structure.”

A subsidiary office assumes accountability on its operations. Its shareholders and directors are not financially liable beyond what their paid shares in the company in case of failure.

“The shareholders and directors cannot be brought to any legal proceedings in relations to their company. Instead, it is the company that is named as the legal party in a legal proceeding brought before the court,” Asiabiz adds.

A Singapore branch office on the other hand, does not have its own legal existence. Thus, its parent company is accountable for the operations maintained by the branch office.

During registration, the subsidiary office follows the process and requirements of a private limited company.

Asiabiz continues: “A subsidiary office needs to have a resident director, at least one shareholder, and a secretary. There ought to be a minimum paid-up capital worth S$1.”

Meanwhile, in a branch office, the parent company shall decide the activities that its branch office in Singapore may undertake.

“A branch office does not have its own Memorandum and Articles of Agreement. Its mother company shall use its own Memorandum to name the branch office’s local directors, their respective responsibilities, and corporate powers,” Asiabiz’s business consultant chimes.

A subsidiary office issues its own Memorandum and Articles of Agreement naming its directors, shareholders, secretary, share capital, and business address.

Asiabiz continues to elucidate: “A branch office has two appointees known as agents who shall assist in the administration of the branch. The resident director leads a subsidiary office in its operations.”

By obtaining work visas such as Singapore Employment pass, foreign nationals can be appointed as the agents in a branch and the resident director in a subsidiary.

Asiabiz offers nominee services such as a nominee agent, and a nominee shareholder and a nominee director for compliance with statutory requirements.

When it comes to benefits, Asiabiz quips: “A subsidiary enjoys tax exemption for three years following its incorporation in Singapore. A branch office, however, may also enjoy tax incentives under the industry-specific tax incentive scheme.”

Singapore is International Finance Corporation’s easiest place to do business for 5 consecutive years. Asiabiz is a prestigious business service provider proffering services such as work visa processing, assistance in complying with post-incorporation requirements, accounting, and IT services.

For more information, visit:
Asiabiz Services Pte Ltd (see location map)
120 Telok Ayer Street
Singapore 068589
Phone: (+65) 6303 4614
Fax: (+65) 6303 2670

0    submitted by Ashley Varghese
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