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What is Know Your Customer (KYC) for Company Incorporation?

Singapore’s thriving business landscape has made it a magnet for entrepreneurs and investors worldwide. However, with the ease of setting up businesses comes the risk of illicit activities like money laundering and fraudulent transactions. To counter these risks, Singapore has implemented stringent Know Your Customer (KYC) regulations for company incorporation.

What is KYC?

KYC is a crucial component in ensuring compliance and mitigating risks associated with financial transactions. It encompasses a series of processes employed by banks and other financial institutions to verify the identities of organisations and individuals they engage with, thereby ensuring legal adherence and minimising the potential for illicit activities.

How is KYC Relevant for Entrepreneurs Looking to Form a Company in Singapore?

In the context of corporate service providers, KYC serves to gather and validate pertinent information about customers planning to open a company, leveraging various public record databases for verification. Typically, customers will have to produce documentation such as proof of identity, proof of address, and recent photographs.

What Documents Do I Need to Prepare for KYC?

You will need to gather distinct sets of documents to help validate the legitimacy of the individuals &/or entities involved.

1. KYC documents for my director

My director is a:
Singapore Citizen or Singapore Permanent Resident
ForeignerForeigner holding a Singapore work pass
Full name, email address and telephone numberFull name, email address and telephone numberFull name, email address and telephone number
Singapore NRIC (photo/scan of front and back of card)Passport (photo/scan of ID pages)Singapore DP/EP/PEP/EntrePass (photo/scan of front and back of card)
Residential address proof issued within last 3 monthsPassport (photo/scan of front and back of card)
Residential address proof issued within last 3 months
*The above KYC documents are dependent upon the current situation of your director.

2. KYC documents for individual shareholders

My individual shareholder is a:
Singapore Citizen or Singapore Permanent Resident ForeignerForeigner holding a Singapore work pass
Full name, email address and telephone numberFull name, email address and telephone numberFull name, email address and telephone number
Singapore NRIC (photo/scan of front and back of card)Passport (photo/scan of ID pages)
Singapore DP/EP/PEP/EntrePass (photo/scan of front and back of card)
Residential address proof issued within the last 3 monthsPassport (photo/scan of front and back of card)
Residential address proof issued within the last 3 months
*The above KYC documents are dependent upon the current situation of your individual shareholder.

3. KYC documents for my corporate shareholder

The following required KYC documents for your corporate shareholder may vary based on the jurisdiction where the company is registered.

  • Certificate of Incorporation/Registration or similar document indicating the date and location of incorporation.
  • Business Profile/Certificate of Incumbency or comparable record from the company registry, listing directors & shareholders, and the registered office address.
  • Certificate of Appointment of Corporate Representative and Directors’ Resolution in Writing (if applicable, particularly if a corporate representative has been designated).
  • Passport/NRIC and proof of residential address (issued within last 3 months) for each individual who owns or controls the corporate shareholder.

Four Helpful Tips to Expedite Your KYC Process

  1. Ensure you are easily reachable and maintain regular communication with your corporate service provider.
  2.  Documents must be in English or otherwise translated into English.
  3. Provide proof of address using utility or telecom bills, bank statements, or lease agreements that display your name, address, and date.
  4. Easily submit your KYC documents to Counto by uploading them directly to your Counto account.

Periodic Monitoring & Recordkeeping

After initial screening, corporate service providers continue to monitor client transactions and business activities. Documentation of client information and transaction records must be maintained for at least five years post-termination of the business relationship.

Non-Compliance Penalties

Failure to comply with KYC regulations can lead to severe penalties imposed by the Accounting and Corporate Regulatory Authority (ACRA). Penalties may include hefty fines, business operations disruption, or even suspension/cancellation of company registration.

Summary

KYC regulations are vital for maintaining the integrity of Singapore’s business environment and protecting against illicit activities. Before initiating the company registration process in Singapore, it’s essential to comply with the KYC regulations. Partnering with reputable corporate service providers like Counto ensures seamless compliance with KYC regulations, paving the way for successful company formation in Singapore.

Using an incorporation service as an extension of your team

Setting up a company in Singapore can be challenging, but with professional support, it can be simple, Counto’s mission is to support your new business, take away the complexities of compliance, and save you time and money throughout the year. Speak to us directly on our chatbot, email us at [email protected], or contact us using this form.

 

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