Striking off, consensual winding off, and compulsory winding off are all options for terminating a corporation in Singapore. Simply define, striking off a firm means shutting it down. Nevertheless, in order to register a business address, you must fulfill the ACRA’s requirements.
In this article we will be understanding about strike off company in Singapore, the documents that are required, and the procedure that one needs to follow.
Strike Off Company In Singapore
A firm’s membership is deregistered when it is struck off. As a result, the firm’s identity will be struck by the Company registrar, and the corporation will be liquidated. A strike off company in Singapore can occur on ACRA’s initiative, when the business has discontinued operating, or when the firm’s objective has vanished. Striking off does not absolve the firm’s management and shareholders of any remaining responsibilities.
For another five years, the firm manager will be barred from running any other business if he or she:
- He/she was also a member of at least 2 more businesses.
- In the past five years, the businesses had been deregistered.
Requirements To Strike Off Company In Singapore
To be accepted for striking off, your company should fulfill ACRA’s rules and standards. These characteristics, among many others, might give ACRA grounds to conclude that the firm is not active.
The following conditions must be completed, as per the ACRA’s for a property to be struck off:
- In the charging registry, the firm should have no pending liabilities.
- The corporation has received all or a percentage of existing shareholders to strike off.
- The assets have come to a halt.
- At the date of submission and in the foreseeable, the corporation has no investments or obligations.
- The corporation owes neither the National Pension Organization nor any other governmental body or money.
- IRAS has no pending tax bills for the firm. The corporation must in specifically, guarantee that:
- All revenue tax documents are filed up to and including the date the company stopped production.
- Upon shutting the firm’s checking account, all extra tax concerns with IRAS were resolved.
- The registration form has been canceled, and no GST issues remain.
Procedure To Strike Off Company In Singapore
The company owner, executive officer, or a corporation internet provider can file a strike-off appeal with the Business Registration. ACRA may take 5 working days to a week to process the registration, depending on the circumstances and the documentation presented. The registration does not have a filing cost.
There are two primary ways through which it is possible to strike off company in Singapore, they are as follows:
Striking off the registration by the organization:
Submitting a Request:
If the corporation fits the above-required conditions, the three designated individuals can make an application for striking off digitally using SingPass or CorpPass. The 3 designated people are the secretary of the company, the director of the company, and the registration filling representative.
Unless the application is allowed the ACRA will issue a notification to the company’s board of directors, secretary, and employees advising them of the strike-off request.
Announcements in the Gazette:
Section 334A of the Companies Act states “Unless there is an objection, ACRA will proceed to proclaim the firm name to be struck off in the Government Gazette, also known as the First Official Gazette, within a month of receiving the letter.”
This First Gazette Announcement shall declare that if there is no complaint within 60 days, coupled with sufficient results demonstrating that the business should not be stricken off, ACRA will use its authority to strike off the firm’s identity. Following that, after 60 days, ACRA will issue another notice in the Official, known as the Final Gazette Notification, stating that the property has been stricken off and the firm has been liquidated.
Usually, the complete procedure takes at least 120 days. Reconstruction of the struck-off corporation is feasible if the recovery application is submitted within six years after the business’s dissolution day.
Section 344C (1) of the Companies Act states “Any concerned party can file an opposition to the striking off if they can show substantial evidence, such as that the corporation does not meet the statutory standards. Following confirmation of the objection, ACRA will notify the firm.”
The firm will then be allowed 60 days to solve the problem, after which the striking-off motion will be denied. Only after the issue is resolved may the company file a fresh application.
Section 344B allows the candidate to retract the application at any time until the firm is legally stricken off, with no processing fee. Following that, the Registration will post the resignation on the Ministry’s webpage.
Strike-Off by the authority of the registrar:
As per Section 344 (1) of the Companies Act “If the Registration has sufficient grounds to think that a business has not continued to operate, the corporation can be struck out. Between sending a notice to notify the corporation of the strike off to the subsequent publication in the Gazette after which the company image would be stricken off, the procedure is similar to that reported above, except the step of filing the application.”
What Happens When A Corporation In Singapore Is Delisted?
- A board that has three firms struck off by ACRA within five years will be prohibited from being a director and would be barred from participating in any organizational processes for the next five years.
- A firm can be resurrected by a judicial order within six years of being struck off.
- After the company is liquidated, the directors must keep all of the firm’s articles and books for a threshold of 5 years.
- The obligation of each director and shareholder, if any, will proceed and may be prosecuted as if the corporation had not been liquidated. The authority of the board to wind up the company will not be affected by the firm being struck off.
Reviving A Strike Off Company In Singapore
Section 344(5) of the Companies Act states “During six years following the striking off, you must seek recovery by a judicial order.”
Any director who is unhappy with the strike-off can file a petition to have the corporation restored. The appealing person should be enthusiastic about reviving the business. It might be for financial or personal gain. Although having a compelling reason is not required, having a genuine interest is.
The judge is cautious about reviving a firm that has been struck off, although it may restore it for a myriad of purposes. It may be because the firm was in existence at the time of the strike, or it will be reasonable to ask for reinstatement.
The court will examine numerous factors while making its decision. Here are several examples:
- The intention of reconstruction.
- If there are any advantages to repairing.
- If the firm is revived, would anybody be negatively affected?
If the authority is satisfied with the explanations, the firm will be restored. This will function unless the firm’s revival is hampered by unforeseen circumstances.
Want to establish your business in Singapore, Read More.
Striking off Company vs Winding up Company
Even though both striking off and winding up culminate in the firm’s demise, there are some variances.
- Striking off is a simpler and quicker method for approved minor or defunct businesses. Whereas, winding up an enterprise is a more structured process that is appropriate for businesses that are insolvent or facing a lawsuit.
- When opposed to winding up, the striking-off method is inexpensive. Expenses for the liquidation, judicial charges, and other expenses are incurred throughout the winding-up process.
To conclude, as soon as the prerequisites are completed, a corporation can be stricken off by the Registry or file for strike off on its own in Singapore. The property will be stricken off after two published notices in the Gazette.
The opposition should be sent to ACRA with credible evidence in order to prevent the procedure. Always remember that if your business is in bankruptcy and wants to close, it must go through the procedure of winding up rather than being struck off.
If you have any more queries regarding striking off a company in Singapore, feel free to contact Odint Consulting.
After discharging all of its liabilities, a corporation may apply to the ROC for a strike-off. Simply put, strike off refers to deleting the company’s name from the Registrar of Companies.
You won’t have access to business bank accounts. No money can be sent or received from you. In order to regain access to your bank accounts, you must restore the company.
You can shut down your business. The procedure is known as the dissolving of a restricted business. If specific circumstances are met, a consensual dissolution can be used to withdraw firms from the Company Registration Record.
A mandatory striking-off occurs when a third entity files a request to remove a corporation from the list. Company Secretary is usually the one that files the lawsuit when a company fails to file reports or yearly accounts.
Your firm won’t be removed from the Companies House register until at least three months have passed since you submit the finished DS01 form.
If your company is no longer eligible to be struck off, such as if it is operating or has become insolvency, you must withdraw your application.
Azhar Ansari is a company formation specialist with 8+ years of expertise in international business. Financial planning, risk management, and other related areas.