In this article, we will focus on the striking off process of a company in Singapore and its implications, which is less time consuming but requires a clean balance sheet.
In Singapore, there are two ways of closing a company:
- Through liquidation, which requires the appointment of a liquidator.
- Through striking off, which is only available if the company has no liabilities. The name of company must be published in the Gazette for a period of at least 3 months prior to be strike off. If there is no opposition, the company will be struck-off. The entire process takes about 3 to 5 months.
Applying for a Strike off a Singapore company
To briefly outline the pre-application process, the company’s accounts will need to be zeroized, the company’s bank account closed, and the final annual return and tax return submitted before filing the application to strike off the company.
According to section 344A(1) of the Companies Act, on a company’s application, the Accounting and Corporate Regulatory Authority (“ACRA”) may strike the company’s name from the register. An application is to be made on the company’s behalf by its directors or by most of them.
ACRA may approve the striking off application if the company is not carrying on business and is able to satisfy the following criteria:
- The company has not commenced business since incorporation or has ceased trading.
- The company has no outstanding debts owed to Inland Revenue Authority of Singapore (“IRAS”), Central Provident Fund Board, and any other government agency.
- There are no outstanding charges in the charge register.
- The company is not involved in any legal proceedings (within or outside Singapore).
- The company is not subject to any ongoing or pending regulatory action or disciplinary proceeding.
- The company has no existing assets and liabilities as at the date of application and no contingent assets and liabilities that may arise in the future.
- All/majority of the director(s) authorise you, as the applicant, to submit the online application for striking off on behalf of the company.
Upon receipt of the application, ACRA must send to the company and its directors, shareholders and secretary a letter informing them of the application. A notice will be published in the Gazette with a view to striking the name of the company off the register.
If no one provides in sufficient time or adequate cause why the company’s name should not be struck off the register, ACRA must strike the company’s name off the register and publish a notice in the Gazette that the company’s name has been struck off. The company is dissolved upon publication of the notification in the Gazette.
The Implications of Striking off your company
When a company’s name is struck off and the company is dissolved, a person who was an officer of the company immediately before it was dissolved must ensure that all books and papers of the company are kept for at least 5 years after the day the company was dissolved.
Furthermore, under section 344H(7) of the Companies Act. It is stated that despite the company’s dissolution, the liabilities of all officers and shareholders of the company continue even after the company’s dissolution, and these liabilities are enforceable against them as if the company had never been dissolved.
It is important to mention that if any person feels aggrieved that the name of the company has been struck off the register, Singapore Courts may order the name of the company to be restored to the register on an application made by the person at any time within 6 years after the date on which the company is dissolved.
