What is a Partnership?

In Singapore, a partnership is a business that is formed with two to 20 partners. If there are more than 20 partners, the partnership must be registered as a company under the provisions of the Companies Act. The Business Registration Act defines business as “includes every form of trade, commerce, craftsmanship, calling, profession and any activity carried on for the purposes of gain but does not include any office, employment or occupation, or any of the businesses specified in the First Schedule (List of exempted entities / individuals).”. Individuals and companies that meets the definition of “legal identities” may set up a partnership. A partnership, because it is not a separate legal entity, may not set up a sole proprietorship or a partnership. A foreign company may not set up a partnership unless it is itself registered under the Companies Act.

Under the Business Registration Act prior to commencing business, every person including a partnership with must register with the Accounting and Corporate Regulatory Authority (ACRA) except for the categories exempted under Section 4 of the Act. Any activity that is carried out continually with the objective of making a gain must be registered including online businesses. Failure to register is an offence that may be punished with a fine up to $5,000 or imprisonment for a term not exceeding 12 months. Further, if a partnership does not register itself, it loses the right to enforce any of its rights under a contract unless it applies to the courts for relief or permission to enforce these rights. It is therefore in the interest of all partnerships to register themselves.

A partnership can be registered online by using BizFile which is ACRA’s electronic filing and information retrieval system… This can be done from the office, the home or ACRA’s BizFile Kiosks. A partnership may also engage the services of professionals such as lawyers and accountants or service bureaus to carry out the registration on its behalf. A partnership is normally registered within 15 minutes of payment of the fees (name approval fee of $15 and registration fee of $50). However, it may take from two weeks to two months if the approval of other government authorities is required.

A partnership can be registered only after every partner has consented to or endorsed the online registration and after the necessary fee has been paid. Every partner (like all self employed persons) is required to top up his or her Medisave account with the Central Provident Fund Board before he or she can become a partner in a partnership or renew the registration. This requirement is mandatory for all Singapore citizens and Singapore permanent residents.

If a foreigner wants to register a partnership in Singapore while he continues to live outside Singapore, there must be at least one partner in the partnership who is a local resident in Singapore. If there is no locally resident partner and all the partners are foreigners, they need to appoint a manager who is locally resident.

Leave a Reply

Your email address will not be published. Required fields are marked *