If you plan to conduct an export import business activity, Singapore will be a perfect jurisdiction for incorporating such a venture. This city-state is a world-class player in global commerce.
Its strategic location in the center of Southeast Asia, its air and sea links to facilitate inter-regional and global trade have led to its emergence as a major trade hub in the global supply chain. It now ranks as the 14th largest exporter and the 15th largest importer in the world.
Today, we will talk about the procedure to set up a trading company, the necessary permit requirements, and the long-term compliance obligations that you should consider if you plan to conduct import, export, or transit activities in Singapore.
Why is Singapore an export import hub?
There are several reasons for Singapore’s emergence as an export import center . These are:
Favorable geographical location.
Attractive tax regime.
Stable financial system.
These factors have attracted nearly 70% of the world’s largest commodity trading companies, that generate more than US $ 1 trillion in annual turnover from their Singapore operations.
Steps to set up your export import company in Singapore
In order to start a trading business, you need to register your Singapore company first. The agency in charge of this is called Accounting and Corporate Regulatory Authority (ACRA) which is the national regulator of business entities in Singapore.
The procedure is similar to incorporating any other enterprise. The most suitable form for a trading enterprise is a private limited company. Foreigners are required to work with a Singapore-based corporate services provider to incorporate their company.
After the incorporation process, the company will receive a Unique Entity Number (UEN), which is a standard and unique identification number for each Singapore entity. Al government agencies use the UEN to identify the company in a simple way.
Regulations to have in consideration
Once your company is registered, and has obtained a UEN, you may begin your trading activities. Note that your company must follow the relevant import or export regulations to be in compliance with the laws.
Importing goods into Singapore
To carry out the import activities you must obtain the necessary permits by following a series of steps we briefly mention below.
Activate Customs Account: First you should activate the company’s Customs Account at the Singapore Customs website, after which you will receive a Customs approval letter.
Apply for Inter-Bank GIRO Account: To pay duties, taxes, fees, and other charges on the services provided by Singapore Customs, you need to register and maintain an Inter-Bank GIRO (IBG) account.
Furnish security: After obtaining the IBG, in certain cases the government requires you as an importer or your declaring agent to provide financial security.
Apply for permits and licenses: You will need a customs permit to import the goods. As an importer, you may register yourself as a declaring agent or appoint a declaring agent to act on your behalf. However, Singapore legislation defines certain goods as controlled goods. These require an additional permit from Competent Authorities (CA) before they may be imported into Singapore.
Prepare documents for customs clearance: After you’ve obtained the necessary permits, the last step is cargo clearance. The appropriate documents must be submitted at an entry point. These documents must be preserved for five years from the date of customs permit approval, in either physical or digital form.
The procedure for fulfilling export requirements is similar to that for importing goods. With only a few differences, we mention below.
Apply for permits and licenses: As in the case for importing, additional permits or licenses from the respective Competent Authorities (CA) are required to export controlled or strategic goods.
Controlled Goods: It is important to check if your goods have restrictions imposed upon them by Singapore’s Competent Authorities. You will have to look-up if your products are subject to a restriction with the appropriate Competent Authorities on how to obtain the relevant permit.
Strategic Goods: This category includes goods and technology that are intended or likely to be used as weapons of mass destruction. If you plan to export Strategic Goods, you will have to apply for a Strategic Goods Control Permit through the TradeNet system.