A director of a company incorporated under the Companies Act, Cap 50 ('the Act') has to comply with a number of statutory obligations under the Act. The following are two of the statutory obligations which ACRA takes enforcement action.

  • Section 175 of the Act requires the company to hold an Annual General Meeting (AGM). Listed companies are to hold the AGM within 4 months after Financial Year End (FYE), while any other company is to hold their AGM within 6 months after FYE. Private companies may not need to hold an AGM if they meet the criteria specified in section 175A of the Act (elaborated below).  
  • Section 197 of the Act requires a listed company to file Annual Returns (AR) within 5 months after FYE, and for all other companies, within 7 months after FYE.  For companies having a share capital and keeping a branch register outside Singapore, Annual Returns must be filed within 6 months after FYE in the case of a listed company or within 8 months after FYE in the case of a company that is not listed. 

Section 175A sets out the criteria where private companies need not hold an AGM:

  • if all members have approved a resolution to dispense with the holding of AGMs;
  • if the company sends their financial statements to members within 5 months after the FYE; or
  •  if the company is a private dormant relevant company that is exempt from preparing financial statements.         

The following safeguards are put in place: 

  1. A member who wishes to request that an AGM be held must notify the company to hold an AGM not later than 14 days before the last day of the 6th month after FYE;  
  2. Directors must hold an AGM within 6 months after FYE if notified by any one member of the company to do so. The company may seek the Registrar’s approval for an extension of time to hold AGM; and 
  3. Private companies must hold a general meeting to lay financial statements if any member or auditor requests for it not later than 14 days after the financial statements are sent out. Directors must, within 14 days after the date of request, hold a general meeting to lay the financial statements.

The AR provides critical information that helps the company’s stakeholders to make informed decisions. The AR is an electronic form lodged with ACRA through its online filing system – Bizfile+ and contains important particulars of the company such as the name of the directors, its members, and the date to which the financial statements of the company are made up to.

 Note:   For companies with Financial Year Ending before 31 Aug 2018, the following statutory obligations and deadlines are still applicable

  1. Section 175(1) of the Act -   The company must hold its first AGM within 18 months of incorporation, and subsequent AGMs yearly at intervals of not more than 15 months
  2. Section 197(1)(b) of the Act -  The company is required to lodge an AR within 30 days after its AGM. A company having a share capital and keeping a branch register in any place outside Singapore, is required to lodge an AR within 60 days after its AGM.
  3. Section 201 of Act - The directors of the company are required to lay at the AGM, financial statements that are made up to a date: 
    • Not more than 6 months before the date of the meeting (if the company is not a listed company); or  
    • Not more than 4 months before the date of the meeting (if the company is a listed company). 

When a company/director lodges an AR through ACRA's online filing system, BizFile+, the following information is required  in the AR form:-

  1. The date the financial statements are made up to; and, if applicable
  2. The date the AGM is held for laying the financial statements in (a).

If the company has dispensed with the holding of AGM or qualifies for the AGM exemption and  a member requests for an  AGM to be held after the company has filed an AR, the company is required to lodge a “Notification of AGM” online through Bizfile+. The following information is required in the form:

  1. Date of member’s request for AGM to be held; and
  2. Date of AGM

Based on the information provided, the online system will ascertain if the company/director is in breach and calculate the relevant composition sum and late lodgement fee.

Enforcement actions against companies and directors for annual returns filing breaches

Composition Fines

Companies and directors that breach these statutory obligations may be offered an opportunity to pay a composition sum of $300 per breach instead of facing prosecution. Separately, a late lodgement fee will be imposed at the time of lodgement, for each AR that is lodged late. The composition sum and late lodgement fees are as follows: 

Requirements Type of Breach Type of Penalty Imposed against Penalty
Section 175  The AGM is held late  Composition  Company Composition sum of $300
Section 197 
The AR is lodged late  
Late lodgement fee Company 

Late lodgement fee of $300

(Second Schedule of Companies Act) (Fees and Late Lodgement Penalties Regulations 2015)

Section 201(1)*

Financial statements laid at AGM are more than 6 months old for a non-listed company or more than 4 months old for a listed company

Composition  Director(s)

Composition sum of $300

*Applicable for FYE ending before 31 Aug 2018

For FYE ending on or after 31 Aug 2018

Example 1

ABC Company Private Limited is due to hold its AGM by 1 Mar 2019 (section 175) and to lay its financial statements made up to FYE 1 Sept 2018 (section 201). 
The company held its AGM on 14 June 2019 and lodged the AR on 10 July 2019 (section 197). The company has breached sections 175 and 197.

Requirements Due Date AGM Date/Lodgement Date Amount payable
Section 175 1 Mar 2019 (FYE + 6 months) 14 June 2019 Composition sum of $300
Section 197 1 April 2019 (FYE + 7 months) 10 July 2019 Late lodgement fee of $300
Example 2

DEF Company Private Limited meets the conditions of section 175A(1) and is not required to hold an AGM. The company’s FYE is  30 Sep 2018, and it sent out its financial statement to its members on 20 Feb 2019. The company then lodged its AR on 15 May 2019 (section 197). The company has breached section 197. The penalty imposed is as follows:    

Requirements Due Date AGM Date/Lodgement Date
Section 175 Not applicable Not applicable No composition sum payable
Section 197 30 Apr 2019 (FYE + 7 months) 15 May 2019 Late lodgement fee of $300

For FYE ending before 31 Aug 2018

Example 3

ABC Company Private Limited is due to hold its AGM by 25 May 2015 (section 175(1)) to lay its financial statements made up to 31 December 2014 (section 201(1)). The company held its AGM on 14 October 2017 and lodged the AR on 10 November 2017 (section 197(1)). The company has breached sections 175(1) and 201(1).

Requirements Due Date AGM Date/Lodgement Date Amount payable
Section 175  25 May 2015  14 Oct 2017  Composition sum of $300 
Section 197  13 Nov 2017 10 Nov 2017  No late lodgement fee payable 
Section 201  30 Jun 2015  14 Oct 2017  Composition sum of $300

Prosecutorial action

ACRA will consider prosecuting the directors in court if:-
  1.  they fail to compound (when offered a chance to compound); or 
  2. the circumstances of the case are such that composition is not appropriate, for example, multiple breaches or recalcitrant breaches. 

If a director seeks to compound his breach(es) after a summons has been issued, ACRA may not allow him to compound. 

After a summons is issued by the courts, ACRA will send the summons to the director at his residential address by post. The summons will indicate the State Court number, date and time that the director has to attend court. If the director fails to attend court, a warrant for his arrest will be issued by the court. The director must attend court even if he has written to ACRA to review his summons.

In court, the director can decide whether to plead guilty or claim trial to the charges. If the director is convicted by the court, he may be fined up to a maximum of $5000 per charge.

Disqualification of directors for filing breaches

Companies and directors should take note that a director who is convicted of three or more filing related offences under the Companies Act within a period of five years, will be disqualified as a director, under S155 of the Companies Act. Once disqualified, an individual will not be allowed to be a company director or take part in the management of any local or foreign company for five years, effective from the date of the conviction. A disqualified director cannot take on any new appointment as a director, or be in any way directly or indirectly concerned or take part in the management of a company.

Striking off of companies that failed to file ARs

In 2016, the Companies (Amendment) Act 2014 were implemented to give ACRA  the power to strike off a company if there is reasonable cause to believe that a company is not carrying on business or is not in operation. For example, the failure to file with ACRA the ARs for consecutive years.  

ACRA will also disqualify a director with at least 3 companies struck off by ACRA within a period of 5 years. Once disqualified, an individual will not be allowed to be a company director or take part in the management of any local or foreign company for five years, commencing on  the date on which the third company is struck off. A disqualified director cannot take on any new appointment as a director, or be in any way directly or indirectly concerned or take part in the management of a company. For the avoidance of doubt, the striking off of the three companies refers to striking off initiated by the Registrar and does not include voluntary applications for striking off

Debarment Order

In 2016, a debarment regime was introduced to empower the Registrar to debar any director or company secretary who is in default of a relevant requirement in the Companies Act, including failure to lodge any documents, for a continuous period of 3 months or more. A debarred person cannot take on any new appointment as a director or company secretary of other companies

Making Representation to ACRA

If a director would like to make representations to ACRA to review the summonses issued against him (for e.g. to reduce the number of charges), ACRA will require time to review these representations and such representations are rarely acceded to.

To make a representation to ACRA, please retrieve a Representation Form (PDF, 300KB) and provide the basis for the representation. Please also attach supporting documents (if any) to support the basis.

Once the Representation Form has been completed, please send it to ACRA [Attention: Enforcement Department (Enforcement)] via: 
  • Email at: acra_cd@acra.gov.sg; or
  • Post to: 10 Anson Road, #05-01, International Plaza, Singapore 079903    

We may take up to 8 weeks to respond if the case is complex in nature.

To check on the status of the representation, please email to acra_cd@acra.gov.sg

Seeing a Compliance Manager

If a person wishes to see a compliance manager to discuss his case, he would need to make an appointment with his compliance manager so that an appropriate date and time is set aside for the compliance manager to meet up with him.

The person would be required to complete a Representation Form (PDF, 300KB) and send it to us (please refer to paragraphs 17 to 21 above). This is to enable the compliance manager to first assess if the case can be dealt with either through a telephone conversation or a written reply without the need for a physical meeting.

If the person does not provide sufficient information, basis or supporting documents in the Representation Form, the compliance manager would need to spend time to contact the person to obtain more information and this will lead to further delay in reviewing the case.

If an appointment is necessary, the compliance manager will contact the person by phone or via email to inform him of the appointment date and time.

IMPORTANT POINTS TO NOTE

Companies are statutorily required to hold an AGM (unless the company has dispensed with or is exempted from holding AGM) and lodge an AR within the stipulated timeframes.

The company and its directors should endeavour to hold the company’s AGM, if applicable, and lodge the AR within the stipulated timeframes to avoid facing  enforcement action from ACRA.  

In addition, company directors are to ensure that the particulars of the company (e.g. registered office address) and its officers are kept up to date. 

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