World Economic Forum’s Global Competitiveness Report 2013–14 also ranks the city-state as the second most competitive economy in the world, offering the best IP protection, infrastructure and incentives in Asia.
A testimony to this is the increasing number of foreign investors, who want to take advantage of Singapore’s attractive tax framework and are incorporating their companies here. So much so that Singapore’s Accounting and Corporate Regulatory Authority (ACRA) registered a total of 20,365 new companies in the first half of 2014, as the year sets to improve on the 8.2% average annual growth rate of company formation witnessed in Singapore in the last few years.
If you are a foreign entrepreneur and want to take advantage of Singapore’s pro-business climate, the Ministry of Manpower (MOM) provides an option of EntrePass, which is a visa for entrepreneurs who are ready to incorporate and run a new private limited company in Singapore.
Initially conceived for businesses involved in innovative technology creation and application, the EntrePass framework was further enhanced last year to include technopreneurs and R&D-intensive enterprises including the clean-tech and biotech sectors.
ENTREPRENEUR PASS PREREQUISITE CRITERIA:
Before you think about applying for the EntrePass, do note that a mandatory requirement for the application is meeting at least one of the following:
- You must receive strictly monetary funding of at least S$100,000 from a recognised third-party VC or a Singapore government agency accredited business angel such as the Global Investor Programme, Economic Development Board, SPRING Singapore
- One of the shareholders in the company possess an IP registered with an approved national IP institution; and the business mentioned in the EntrePass application must be related to the said IP
- The EntrePass applicant has ongoing research collaboration with institutes of higher learning in Singapore or other institutions recognised by Singapore Government’s premier research agency A*STAR
- The private limited company is based at a Singapore Government supported incubator such as MDA’s iJam and SPRING Singapore’s Incubator Development Programme
If none of the above applies, it’s always advisable to go for a Singapore Employment Pass (EP).
Every EntrePass application is reviewed by two government bodies – SPRING Singapore and MOM, which must always satisfy the following conditions:
- The applicant must hold at least 30 percent shares in a private limited company registered in Singapore, which has the paid-up capital of at least S$50,000.
- A bank statement, from the Singapore-based company bank account, of at least $50,000 is required for verification.
- It is not mandatory to register the private limited company before making the Pass application. But if the incorporation is done before the application, the date of incorporation must not be more than six months from date of application.
- It’s pertinent that the business activities of the company are legal and are entrepreneurial in nature. Note that certain types of businesses are not eligible under the EntrePass scheme. Businesses which are not considered for the EntrePass include:
- coffee shops, hawker centres, food courts
- bars, night clubs, karaoke lounges
- foot reflexology, massage parlours
- acupuncture, traditional Chinese medicine, herbal dispensing
- employment agencies, geomancy
- While it’s important that the applicant has the relevant experience and excellent track record in creating and managing a business successfully, he or she must also submit a 10-page draft business plan along with the EntrePass application. This plan must include:
- total local business spending of at least S$100,000 for the first 12 months
- hiring of at least two Singaporean residents within the first 12 months
- Singapore EntrePass application Form 8
- a copy of educational certificates
- one passport-size photograph taken within the past three months
- a copy of the passport personal particulars page
- Do note that the EntrePass application form requires the local contact person details including the address. We can provide you the same if you choose to engage our services.
- MOUs or contracts with potential clients for the new business, if any
- brochures, press releases, or any other business collaterals from previous or existing business ventures
- a well-drafted, 10-page business plan detailing business goals and objectives
- a bank statement, from the Singapore-based company bank account, of at least S$50,000
- if the private limited company is receiving funding of at least S$100,000, the applicant must provide the shareholder certificate and other supporting documents.
- if the shareholder owns an IP, provide the IP certificate.
- if the EntrePass applicant has any research collaborations, the research institution must provide a contact person for verification of research collaboration details, which must be related to proposed business
- If the applicant satisfies the incubation requirement, provide the proof of incubation
- register a private limited company
- have at least 30% shareholding in the company
- have at least S$30,000 paid-up capital
- appoint a company secretary
- have a registered local address
Timeline for EntrePass Application
It takes around four to six weeks to process an Entreneur Pass application, as the requirements are stringent compared to those of an EP. If MOM requires further clarifications, the processing period may be extended.
Collection of EntrePass
Once the Pass is approved, MOM issues an approval-in-principle letter. Upon receiving it, the applicant must register the company with ACRA within 30 days, if not done so already.
Upon submitting a proof of new company registration and paid-up capital (minimum of S$50,000), the final approval called in-principle-approval (IPA) letter is issued.
With the IPA, you have six months to relocate to Singapore to start operating your new company.
- a copy of the IPA letter
- passport size photo
- original passport with the disembarkation card
- medical exam report* (if required as stated in the In-Principle Approval letter)
- any other documents that are requested for in the IPA
* You may get a medical examination done in your own country through an established clinic/hospital or in Singapore. Most clinics in Singapore can provide medical examination and report within a day.
After EntrePass Approval
On successful approval of the EntrePass, applicants must submit the following within six months:
- tenancy contract or employees’ CPF statements
- latest ACRA business profile
The renewal of the Pass is directly dependent on the contribution of the EntrePass holder (as indicated in the table below) as well as the success achieved in meeting the objectives stated in the draft business plan.
|No. of years after award of EntrePass||Local jobs created*||Minimum TBS**|
|5 or more||10||S$400,000|
*The employees need to be full-time staff (citizens or PR) and engaged under a contract of service. They must receive monthly salaries of at least S$1000 on time as well as have CPF contributions.
** Total Business Spending (TBS) = [Total Operating Expenses – (Royalties/Franchise Fees/Know How Fees to Overseas Companies + Work Subcontracted to Overseas Companies + Remuneration to Applicant & Immediate Family)]
Appeal on Rejection of an EntrePass Application
If all the above mentioned is taken care of diligently, there is no reason why your EntrePass application will be rejected. But if it does, under exceptional circumstances, we liaison with the MOM and investigate the reasons for the rejection.
After rectifying the stated reasons, we submit a strong appeal on your behalf, which is an area of our expertise. The ministry takes a minimum of three weeks, or more in some cases, to review the appeal.
Eligibility for Permanent Residency
EntrePass holders are eligible to apply for permanent residency in Singapore.
It is advisable to wait for at least six months before making the application so that you can furnish the required proof of six months’ salary and preferably an IRAS tax assessment.
Passes for Family Members of EntrePass Holders
Like the EP and PEP Pass holders, EntrePass holders can also get their family members to join them in Singapore. The only difference is that EntrePass holders are only entitled to dependant privileges after they renew their passes.
- With minimum Total Business Spending of at least $150,000 and creation at least four local jobs:
- Dependant’s Pass – spouse (legally married), unmarried children under 21 years of age, including those legally adopted
- Long Term Visit Pass – common-law spouse, unmarried handicapped children above 21 years old, unmarried step-children under 21 years old
- With minimum Total Business Spending of at least $300,000 and creation at least eight local jobs:
- Long Term Visit Pass – parents
Documents Required for Family Passes:
- duly filled application form
- a photograph of the applicant (passport-sized and taken within last three months)
- personal particulars page of applicant’s passport/travel document
- document(s) establishing the applicant’s relationship with the Pass holder
The list of documents needed to establish the relationship between the EntrePass holder and the applicant is:
|Unmarried handicapped children above 21 years of age||
|Unmarried stepchildren under 21 years of age||
Letter of Consent
Family members of EntrePass holders, who have secured a Singapore Dependant’s Pass (DP), can apply to work in Singapore. For this, they can either go for an EP themselves or opt for a Letter of Consent (LOC).
For the LOC option, the DP holder, with at least three months pass validity still remaining, must first secure a job offer with a Singapore employer. As in case of the EP, an LOC application has also to be made by the DP holder’s prospective employer.
Since the DP, and in turn the LOC, is tied to the main EntrePass holder, both (DP and LOC) are automatically cancelled on the cancellation of the EntrePass.
Interested in applying for an EntrePass PEP? Contact us for a free consultation.