Nominee director services — foreigner essentials — Eligibility and requirements checklist

Raffles Corporate Services works with a panel of corporate and employment law firms; this article is general information, not legal advice.

Nominee director services provide a locally resident director so that a foreign-owned Singapore company can satisfy the residency rule in section 145 of the Companies Act 1967, which requires every company to have at least one director ordinarily resident in Singapore. The nominee is a non-executive, compliance-only appointment; the foreign owners retain full control of the business.

What nominee director services are

Section 145 of the Companies Act 1967 requires that a Singapore company have at least one director who is ordinarily resident in Singapore, meaning a Singapore citizen, permanent resident, or the holder of an appropriate pass with a local address. Where all the beneficial owners are overseas, a nominee (or resident) director fills this statutory role. The nominee does not manage the business, hold shares as owner, or sign off on commercial decisions; the arrangement is documented so the appointment is purely to meet the residency requirement.

Who this is for

This service is for foreign entrepreneurs and overseas companies incorporating in Singapore who do not yet have a resident director in place. It is common in the first year, before a founder relocates on an Employment Pass and can take up the resident-director role themselves. Families and holding structures also use it while they establish local substance, as covered in our note on Singapore holding and tax structures.

Eligibility and requirements checklist

To appoint a nominee director, the provider will require: proof of the company’s shareholding and beneficial ownership; know-your-client due diligence on all owners and controllers; a nominee director agreement setting out the non-executive, indemnified nature of the role; and usually a security deposit. The nominee must be at least 18 years old, of full legal capacity, not disqualified under the Companies Act 1967, and ordinarily resident in Singapore. The company must still separately appoint a company secretary under section 171 and maintain a registered office under section 142.

Cost and timeline

Nominee director services in Singapore commonly cost between S$2,000 and S$3,600 per year, and providers usually require a refundable security deposit, often around S$2,000 to S$5,000, to cover the personal liability the nominee carries. The appointment can be put in place within the incorporation timeline of one to three working days once due diligence clears. The deposit is returned when the arrangement ends and the company has appointed its own resident director.

The step-by-step process

Complete the provider’s KYC on all shareholders and controllers. Sign the nominee director agreement and pay the annual fee and security deposit. Appoint the nominee at incorporation through BizFile+, alongside the foreign directors and shareholders. Operate the company as normal, with the foreign owners making all commercial decisions. When a founder obtains an Employment Pass and relocates, appoint them as resident director and, once the section 145 requirement is met by the founder, release the nominee and recover the deposit.

Common mistakes and gotchas

A frequent misunderstanding is expecting the nominee to sign contracts, operate bank accounts or take management decisions; a compliance nominee does none of these. Another is failing to plan the exit, leaving the company dependent on the nominee for longer than intended and paying recurring fees. Owners should also remember that a director, even a nominee, carries statutory duties and can face liability, which is why proper indemnities and a clean, well-run company matter. Once a resident founder is in place, our guide on director and capital pitfalls for foreign-parent subsidiaries is a useful next read.

What the nominee does and does not do

A compliance nominee director exists to satisfy section 145 of the Companies Act 1967 and nothing more. They do not manage operations, hold executive authority, operate the company’s bank accounts, sign commercial contracts or make investment decisions. Those functions stay with the foreign owners and any executive directors they appoint. The nominee lends their local residency to the register so the company is lawfully constituted while its real decision-makers are overseas. Because a director owes statutory duties regardless of the label, the arrangement is always documented with a nominee director agreement and indemnities.

Due diligence and the security deposit

Reputable providers run full know-your-client checks on every shareholder and beneficial owner before agreeing to act, because the nominee carries personal exposure if the company is misused. Expect to provide identity and address verification, a description of the business, source-of-funds information and the company’s shareholding structure. The security deposit, commonly S$2,000 to S$5,000, protects the nominee against penalties or liabilities arising from the company’s non-compliance and is refunded when the appointment ends cleanly and the company has appointed its own resident director.

Planning the exit from day one

The nominee arrangement should be temporary. The usual exit is for a founder to obtain an Employment Pass, relocate to Singapore and become the resident director, at which point the section 145 requirement is met by a genuine executive and the nominee resigns. Building this into the plan avoids paying recurring nominee fees for years and reduces the compliance risk of relying on someone outside the business. Where relocation is not intended, some owners instead appoint a trusted local partner or a permanent resident as a substantive director.

Cost summary and what drives it

Annual nominee fees of roughly S$2,000 to S$3,600 reflect the liability the nominee accepts and the due diligence the provider must maintain. Companies in higher-risk sectors, or with complex ownership, sit at the top of that range or beyond. The refundable deposit is separate. When comparing quotes, founders should check what is included, whether the fee covers only the appointment or also KYC updates and annual re-verification, and how quickly the deposit is returned on exit.

Governance safeguards for both sides

A well-run nominee arrangement protects the owners and the nominee alike. Owners retain control through the shareholders’ agreement and by appointing their own executive directors and bank signatories. The nominee is protected by the nominee director agreement, indemnities, the security deposit, and by insisting the company stays compliant with its filing and tax obligations. Where either side lets standards slip, for example if the company falls into filing default, the risk to the nominee rises sharply, which is why the best providers monitor compliance actively rather than passively lending a name.

FAQs

Why does a Singapore company need a resident director?
Section 145 of the Companies Act 1967 requires at least one director who is ordinarily resident in Singapore. A nominee director fills this role when all owners are overseas.

Does a nominee director control my company?
No. A nominee director is a non-executive, compliance-only appointment. The foreign owners keep full control of shares and commercial decisions.

How much do nominee director services cost?
Typically S$2,000 to S$3,600 per year, plus a refundable security deposit of around S$2,000 to S$5,000.

Can I replace the nominee later?
Yes. Once a founder relocates on an Employment Pass and becomes the resident director, the nominee can be released and the deposit returned.

Is a nominee director personally liable?
A director carries statutory duties and potential liability regardless of being a nominee, which is why the role is documented with indemnities and a security deposit.

Need help with this? Call, SMS or WhatsApp +65 8501 7133, or email [email protected]. Raffles Corporate Services works with a panel of corporate and employment law firms; this article is general information, not legal advice.