If you are incorporating a Singapore company as a foreigner, or if your Singapore company does not yet have a locally resident director, you will almost certainly encounter the term “nominee director.” This is one of the most commonly used — and most commonly misunderstood — concepts in Singapore company formation.

This guide explains what a nominee director is, what the law requires, what risks they carry, and what safeguards need to be in place for both the company and the nominee themselves.

Why Singapore Companies Need a Resident Director

Under Section 145 of the Companies Act 1967, every Singapore company must have at least one director who is ordinarily resident in Singapore. This means the person must have their habitual place of residence in Singapore — a Singapore citizen, Singapore permanent resident, EntrePass holder, or Employment Pass holder are all eligible.

For foreign entrepreneurs incorporating a Singapore company from abroad — or for foreign-owned companies that do not have a qualifying local employee — this creates an immediate practical challenge: they must appoint a Singapore-resident director before the company can be incorporated.

A nominee director is a professional service provider who fulfils this statutory resident director requirement on behalf of the beneficial owners of the company. The nominee appears on the ACRA register as a director, but the company’s business decisions are made by its beneficial owners or management team.

The 2025 Rule Change: Nominee Directors Must Now Come from ACRA-Registered CSPs

One of the most significant recent changes to Singapore’s nominee director rules took effect on 9 June 2025. Under the revised Corporate Service Providers (CSP) regime, nominee director appointments made “by way of business” — that is, as a commercial service offered for remuneration — must now be arranged exclusively through an ACRA-registered Corporate Service Provider.

This means it is no longer permissible to engage a friend, a personal contact, or a non-CSP company employee to serve as your nominee director on commercial terms. Doing so is now a criminal offence, carrying fines of up to S$50,000 and imprisonment of up to two years for both the person arranging the appointment and (in some cases) the nominee themselves.

If your current nominee director arrangement pre-dates June 2025 and was not set up through an ACRA-registered CSP, you should review it urgently. Raffles Corporate Services is an ACRA-registered CSP and can assist with compliant nominee director appointments.

What a Nominee Director Is — and Is Not

A nominee director is not a rubber stamp, a passive registration token, or a legal fiction. Under Singapore law, every director — including a nominee director — carries the full statutory duties set out in Section 157 of the Companies Act 1967:

  • The duty to act honestly and use reasonable diligence at all times
  • The prohibition on using the director’s position to gain an improper advantage or to cause detriment to the company
  • The fiduciary duty to act in the best interests of the company as a whole

A private indemnity agreement between the nominee and the beneficial owner does not override these duties or remove them from the nominee’s legal obligations. In other words: a nominee director who signs whatever is put in front of them, without exercising any judgement, remains personally liable if things go wrong.

This risk has sharpened significantly since 6 May 2026, when the CALA 2025 changes raised the maximum fine for director duty breaches from S$5,000 to S$20,000, with up to 12 months’ imprisonment for serious cases. See our overview of all CALA 2025 changes that affect directors.

How a Nominee Directorship Is Structured Safely

A properly structured nominee director arrangement involves several key documents and safeguards.

Service Agreement

The nominee director and the company (or the beneficial owner) enter into a service agreement setting out the scope of the nominee’s role, the remuneration, and the circumstances under which the nominee will and will not take action. The agreement should also define the limits of the nominee’s authority — for instance, the nominee may be required to seek instructions before approving transactions above a certain value, or may be expressly prohibited from taking on additional roles (such as serving as a bank signatory) without prior written consent.

Deed of Indemnity

The beneficial owner provides a Deed of Indemnity to the nominee, agreeing to indemnify the nominee against any losses, claims, or liabilities arising from the nominee’s role — subject to the nominee having acted in good faith and without gross negligence. This does not eliminate the nominee’s liability to third parties, but it does give the nominee a contractual right of recourse against the beneficial owner.

Undated Resignation Letter

The nominee typically provides an undated resignation letter to the beneficial owner at the outset, which can be used to effect a prompt change of director if the relationship breaks down. This is a standard risk management tool for both parties.

Directors’ and Officers’ (D&O) Insurance

For nominees taking on higher-risk companies — particularly those with complex structures, external investors, or regulated activities — D&O insurance provides a further layer of protection. While not legally mandatory, D&O cover is increasingly expected by professional CSP nominees as a condition of accepting appointment.

What Nominee Directors Should and Should Not Do

In practice, a well-run nominee directorship involves the nominee:

  • Signing resolutions and returns that have been reviewed and approved at the beneficial owner’s direction
  • Attending (or being counted for quorum at) board meetings where appropriate
  • Monitoring the company’s compliance with basic filing obligations (annual returns, AGM notices, changes in particulars)
  • Exercising genuine judgment about whether any proposed resolution is facially lawful before signing

A nominee director should not:

  • Sign blank resolutions, blank cheques, or documents whose content is not disclosed to them
  • Act as an authorised bank signatory without specific written instructions and appropriate safeguards
  • Consent to the company taking on liabilities (loans, guarantees, or other commitments) without review
  • Remain a director of a company they know to be carrying on fraudulent activity

Company secretaries have a key role in ensuring that nominee directors receive properly prepared documents and are briefed on what they are being asked to approve. For the full scope of company secretary statutory duties in Singapore, including the post-CALA 2025 landscape, see our dedicated guide.

Cost of a Nominee Director in Singapore

The annual fee for a professional nominee director service from an ACRA-registered CSP typically ranges from S$1,200 to S$3,000 per year, depending on the complexity of the company, the level of review work involved, and whether D&O insurance is included. Some CSPs bundle nominee director services with incorporation, registered office, and company secretarial services for a combined annual fee.

Companies should view this fee not as a bureaucratic overhead but as the cost of a compliance safeguard — and should ensure the nominee is from a reputable, ACRA-registered provider who will exercise genuine oversight.

When You No Longer Need a Nominee Director

A nominee director can and should be replaced once the company has its own qualifying resident director — for example, when the founder relocates to Singapore and obtains an Employment Pass or permanent residency, or when the company hires a Singapore-resident senior manager who joins the board.

The process involves passing a board resolution to appoint the new director, followed by a resignation or removal of the nominee, and ACRA filing within 14 days of the change. See our Singapore compliance calendar for all key filing deadlines.

If you are setting up a company as a foreigner and are unsure whether you need a nominee director, or if you need legal advice on the structuring of your directorship arrangement, we can help. For foreign founders considering Singapore incorporation, see our guide on how to set up a Singapore company as a foreigner. For Singapore business news and regulatory updates, there are useful resources for founders and directors navigating the post-CALA 2025 environment.

To speak with the team at Raffles Corporate Services, you can email [email protected] or call, SMS, or WhatsApp +65 8501 7133. We are an ACRA-registered Corporate Service Provider and can assist with compliant nominee director services, company secretarial work, and all aspects of Singapore company administration.

— The Editorial Team, Raffles Corporate Services