It is a well-known fact that Singapore offers numerous advantages for companies to thrive. However, to ensure smooth operations, the Singaporean government mandated all businesses must adhere to certain requirements that have been created.
One of the most important requirements is the Register of Registrable Controllers (RORC). RORC itself was created to maintain transparency in the company ownership structures. This is very important, as it is a part of regulatory compliance for every company incorporated in Singapore.
Everything You Need to Know About the Register of Registrable Controller
According to the Singapore Companies Act any type of company incorporated in Singapore - be it local and foreign corporations, or limited liability partnerships (LLPs), is required to use a system called the Register of Registrable Controllers (RORC). This system is important as it can help the government to keep track of and update information about the people who truly own or control a company.
This helps prevent the misuse of companies for illegal activities like money laundering or financing terrorism by making these ownership structures more transparent.
Who can be a controller in a company?
A controller within a company can be an individual or a corporation that meets these criteria:
- Have either directly or indirectly, over 25% of shares or voting rights in the company, or they're entitled to more than 25% of the company's capital or profits.
- Possess the authority to appoint or dismiss company directors, or have the power to influence the company's decisions, either directly or indirectly.
When to set up RORC?
Companies incorporated on or after 31 March 2017 should set up RORC within 30 days after the date of incorporation. But for existing companies incorporated before 31 March 2017, they can do it within 60 days after 31 March 2017.
On the other hand, companies that are not required to maintain the register but are subsequently required to do so, need to do the RORC set-up within 60 days after the date of being required to maintain the register.
What company can be exempt from the RORC Requirement?
All companies incorporated in Singapore are required to comply with RORC requirements. But some companies can be exempted from this requirement, such as:
- Publicly listed companies
- Singapore financial institutions
- Government-owned companies
- A wholly-owned company established by a statutory body under a public Act for a public purpose and its subsidiaries.
- Foreign-listed companies with disclosure requirements
- LLP is a Singapore financial institution
Why is RORC Important?
- Transparency and Accountability
RORC ensures transparency by requiring companies to disclose information about individuals or entities that have significant control or influence over the company. This transparency fosters accountability, allowing stakeholders and authorities to identify those who influence decision-making within the organization.
- Regulatory Compliance
Maintaining the RORC is a legal requirement in Singapore. Companies must comply with regulations by accurately documenting and updating information regarding their registrable controllers. Failure to comply can result in penalties or legal repercussions.
- Preventing Illicit Activities
The RORC helps prevent illicit activities such as money laundering, fraud, and other financial crimes by ensuring that individuals or entities exerting significant control over companies are identified and their information is available for scrutiny.
- Enhancing Trust and Credibility
Having a transparent and accountable system through the RORC enhances trust among stakeholders, including investors, partners, customers, and the public. It showcases a company's commitment to operating ethically and by regulatory standards.
- Global Standards and Reputation
Being compliant with RORC requirements aligns with international standards of corporate governance and transparency. This adherence contributes to Singapore's reputation as a reliable and trustworthy business hub on the global stage.
- Access to Information
The RORC ensures that essential information about registrable controllers is accessible. This accessibility aids authorities, legal entities, and other interested parties in conducting due diligence, investigations, or assessments related to company ownership and control.
Overall, the RORC serves as a crucial mechanism for promoting transparency, regulatory adherence, and trust within the corporate landscape in Singapore. It not only aligns with global standards but also facilitates access to vital information for various stakeholders, contributing to a robust and accountable business environment.
How to Set up RORC?
Establishment Process
To set up the RORC, you have to follow several steps. From identification of registrable controllers, gathering necessary information, and creating the register itself. Below are the completed steps that must be followed.
Step 1: Identify Groups to Send Notices
First things first, companies need to identify and collect details about the controllers by issuing notifications. These notifications must be sent to specific groups:
- Known controllers
- Potential controllers
- Anyone involved in the company who knows about the controllers.
Step 2: Sending Notices
Your business must send notice annually and this can be done electronically or in hard copy to the proven registrable controllers.
Step 3: Responses from Registrable Controllers
After receiving these notifications, people listed as registrable controllers need to confirm their status and share information about any other possible controllers. They should also provide the required information within the stipulated time frame mentioned in the notice.
If these controllers don't respond within 30 days from the date of the notice, the company must include the latest available details of the potential controller in the RORC. If your company can't directly obtain the required information through the notice, notifications can be sent to individuals who have knowledge about the controllers. It's important to note that if the company already has the necessary information about the controller, sending notices may not be required.
Important Information for the RORC
For controllers who are individuals:
- Full name or any known aliases
- Residential address
- Nationality
- Date of Birth
- Identity card number or passport number
- Date of becoming controller for the company
- If any, date of ceasing to be an individual controller for the company
For controllers who are corporate entities
- If any, name or unique entity number
- Registered office address
- Legal form and jurisdiction of formation or incorporation
- The official name of the corporate entity registered in the jurisdiction where it was formed or incorporated.
- Identification number or registration code of the registrable corporate controller in the corporate entity registry, if such a number exists.
- The date when the corporate entity started acting as a controller for the company.
- If any, the date when the corporate entity stopped being a controller for the company.
If a company is unsure about who its registrable controller is, certain individuals in the company are automatically considered registrable controllers, such as directors with executive control and the CEO of the company.
Get in Touch with Wealthbridge!
Every company in Singapore needs to set up its RORC to ensure transparency and accountability in corporate ownership structures. Make sure you don’t miss that, as failure to complete this can result in fines and court summons.
Want to know more about RORC and how to set up one? Contact our corporate services team and make your life easier today!