Growth in businesses prompts companies to enter new global markets. However, this expansion comes with increased regulatory challenges and involves additional statutory compliances such as money laundering, data privacy breaches, corruption, etc. Failure to comply with these regulations can impact businesses adversely and may even have legal complications.
Your prospective business partner with whom you intend to partner for Singapore company incorporation may provide you with incorrect information and something different from what has been lodged with government authorities.
A business organization needs to verify a company before entering into any formal agreement and clearly understand the potential liabilities under anti-corruption laws and other legislations. The verification process allows you to make informed decisions about which partners you can do business with and in what capacities.
Initial verification and due diligence provide you with opportunities to know your prospective business partners better and gain insights on many aspects including
- If the business entity exists and functional.
- If it is free of any fraudulent activities.
- If the entity makes timely disclosures and complies with all statutory requirements.
- If the entity has the good financial health.
- If the business enjoys a favorable opinion of the company auditors and directors for an effective administrative function and good business governance.
- Business risks associated with the entity.
- Business opportunities and optimization potential.
- Mitigation planning that can lower the risks of working with the entity.
- Corporate registry data can provide you information on the owner's percentage of shares, company structure including subsidiary and beneficiary companies.
- If the entity has any legal or civil actions pending against it.
ACRA, the regulatory body for all Singapore registered companies establishes, administers, keeps, and maintains repositories of documents and information relating to business entities that are registered with it and to provide access to the public, suppliers, customers, and others stakeholders to such documents and information.
The information lodged with ACRA allows both the public and stakeholders to carry out checks on the background of the business entities including the persons involved as its policy to maintain and promote transparency and trust in the business environment and all business dealings.
Basic information on business entities registered in Singapore is available at ACRA’s online Business Directory Search service at BizFile+.
Information collected by ACRA is organized and maintained as several information resources as the business profile report. All reports are available at iShop@ACRA on making required payments and are sent to the requestor’s email.
The iShop@ACRA portal enables both businesses and the public to access information for decision-making purposes and business facilitation.
There are four authorized Information Service Providers (ISP) with ACRA for sharing value-added information to the public and are
Every business or company has its credit rating and legal status which are often verified by the stakeholders to assess its worthiness before establishing any business relationship.
You can run a background check of your prospective business partner either by yourself or by seeking the assistance of a third-party investigator or a company secretarial services or a law firm.
Any verification process must start with ACRA that provides both free online directory search and paid reports to the public for verifying a business entity with the name typed in the search file.
The steps involved are
- Going to ACRA’s free online directory search platform https://www.bizfile.gov.sg/
- Typing the “company name” that you need to verify
- Verifying the CAPTCHA verification code once prompted to ensure that you are naturally human and not a spam-sending computer or robot
- Displaying information related to the company.
The information displayed comprises of
- 1. The company’s name, address, UEN, and industry as well as the validity of the registered business address of the company and any other address than that displayed on the website should be a matter of concern raising suspicion about the company.
- 2. The status of the business entity will also be displayed and a “live” status will tell that the company presently exists and operating.
- 3. The legitimacy and company's adherence to an annual filing with compliance rating will also be displayed with a green tick appearing that indicates the company complies with the annual filing requirements under the Singapore Companies Act. A red cross signifies non-compliance and raises a red flag about the company.
A green tick also means that the company has held its Annual General Meeting (AGM) on time with the latest accounts and financial statements presented at the AGM.
A green tick also confirms that the Annual Return filing has been submitted within 30 days of convening the AGM.
It is always advisable to hire a professional services team based in Singapore who can draw meaningful conclusions from reliable data with multi-level deep due diligence.