1. As per Singapore Companies Act, a Singapore company must appoint at least one director. Every company also must have at least one director who is a local resident of Singapore. A company director must be at least 18 years old, of full legal capacity and not disqualified from acting as a director of a company.
2. A company director is responsible for managing the affairs of the company and setting the company’s strategic direction. A company director is required under the Companies Act to ensure accurate and timely record keeping, prepare financial statements and comply with corporate filings and other disclosures. The director also has the legal duty to advance the interests of the company, act honestly and in good faith in exercising the given powers.
3. A person may cease to be a director of a company by resignation or disqualification. When a director resigns, the Company Secretary will prepare a Directors’ Resolutions that the Board of Directors acknowledge and accept the resignation of the resigning director. A director’s resignation is valid if the following conditions are satisfied:
- The resignation procedure complies with the company’s constitution.
- The company must have at least 1 remaining director who is residing in Singapore.
4. As for disqualification of director, there are various circumstances where a director may face disqualification. Once he is disqualified, ACRA will disqualify and not allow the person to be a director or take part in the management of any local or foreign company, unless he seeks permission from the High Court or Official Assignee, if applicable.
5. The following are the circumstances which can disqualify a person from being a director:
- A bankrupt
- Disqualified by an order of the Court
- Company being wound up for reasons of national security or interest
- Convicted of an offence involving fraud or dishonesty that is punishable with an imprisonment term for 3 months or more
- Convicted for 3 or more filing related offences under the Companies Act within a period of 5 years
- Has 3 or more High Court Orders made against him compelling compliance with the relevant requirements of the Act, within a period of 5 years
- Has 3 or more of his companies struck off the register by ACRA under section 344 within a period of 5 years.
6. The disqualification period depends on whether the director has been sentenced to imprisonment.
If the director is imprisoned, his disqualification will begin when he is convicted, and will continue for another five years or shorter as ordered if disqualified by the Courts after he is released from prison.
If the director was not sentenced to imprisonment, he will be disqualified for 5 years or shorter as ordered if disqualified by the court, from the date of his conviction.
6. Besides being disqualified from being a director of a company, the person may also face the consequences of breaching the director’s duties, which can be both civil and criminal in nature. Different offences carry different levels of penalty. For common offences, a director could be liable up to S$5,000 or even imprisonment of up to two years. Other offences can result in the disqualification from being a director for a period of 5 years.
7. However, a person can still continue to incorporate a new company or be appointed as a director of his previous company after the end of his disqualification period. The company must then notify ACRA via BizFile of his fresh appointment as director of the company within 14 days from the date of appointment.
8. PL Biz Consulting Pte Ltd is an ACRA Registered Filing Agent and Registered Qualified Individual since 2016. Please come and talk to us if you need help for your company’s matters regarding director appointment and disqualification. We at PL Biz Consulting Pte Ltd can assist you to ensure that you comply with the Singapore Companies Act and ACRA regulations.
