Company Types
Different types of businesses necessitate different company setups. Before starting a business or incorporating a company, learn which type of company will work most efficiently for your business.
Sole-Proprietorship
A sole-proprietorship is a business owned by one person or one company. There are no partners. The sole-proprietor has absolute say in the running of the business.
Partnership
A partnership is a business firm formed by two to twenty partners. Once there are more than twenty partners, the partnership must be registered as a company under the Companies Act, Cap. 50.
Limited Partnership
A Limited Partnership (LP) is a partnership consisting of a minimum of two partners, with at least one general partner and at least one limited partner. An LP does not have a separate legal entity from the partners, i.e. it cannot sue or be sued or own property in its own name. A general partner is responsible for the actions of an LP and liable for all debts and obligations of the LP. A limited partner is not liable for debts and obligations of the LP beyond his agreed contribution, provided he does not take part in the management of the LP.
Limited Liability Partnership
A Limited Liability Partnership (LLP) is a business vehicle that gives owners the flexibility of operating as a partnership while having a separate legal identity like a private limited company. The LLP has perpetual succession, which means any change in the partners of an LLP will not affect its existence, rights or liabilities.
Private Company limited by shares
(i) Private Company
A private company has a maximum number of shareholders limited to 50.
(ii) Exempt Private Company
An Exempt Private Company (EPC) is a private company which has at most 20 shareholders and none of the shareholders is a corporation. It can also be a company the Minister has gazetted as an EPC (see section 4(1) of the Companies Act).
Public Company
(i) Public Company limited by shares
A public company limited by shares can have more than 50 shareholders. The company may raise capital by offering shares and debentures to the public. A public company must register a prospectus with the Monetary Authority of Singapore before making any public offer of shares and debentures.
(ii) Public Company limited by guarantee
A public company limited by guarantee is one which its members contribute or undertake to contribute a fixed sum to the liabilities of the company by way of guarantee. It is commonly formed for carrying out non-profit making activities, such as for promoting art, charity etc.
Foreign Company
A foreign company is a company, corporation, association or other body incorporated outside Singapore. A foreign company may carry on business in Singapore by incorporating a local company or registering as a foreign branch under the Companies Act. The foreign company is required to have a registered name, at least 1 local agent and a registered office in Singapore.