Economic & Business Laws — Singapore

Economic and Business Laws for Immigrants to Singapore

*Note: Singapore's policies are updated frequently, especially work pass salary thresholds and quotas. Verify current figures with the Ministry of Manpower (MOM), ACRA, and Singapore Economic Development Board (EDB) before making decisions.*

Right to Work by Visa/Pass Type

Employment Pass (EP)

• For professionals, managers, executives
• Minimum qualifying salary: S$5,600/month (higher for financial services, ~S$6,200); higher thresholds for older, more experienced candidates on a sliding scale
• Subject to COMPASS framework (Complementarity Assessment Framework) - points-based system assessing salary, qualifications, diversity, and local workforce support
• Tied to specific employer; changing jobs requires new EP application
• No quota/levy required (unlike work permits)

S Pass

• For mid-skilled workers (technicians, associate professionals)
• Minimum qualifying salary: S$3,150/month (higher in financial services)
• Subject to quota (Dependency Ratio Ceiling - DRC): max 35% of workforce
• Employer pays monthly levy (S$550-S$650 depending on quota tier)

Work Permit (WP)

• For semi-skilled/unskilled workers in construction, marine, manufacturing, services, domestic work
• Source country restrictions apply
• Strict quotas and levies by sector
• Cannot bring dependents (with limited exceptions)

Personalised Employment Pass (PEP)

• For high-earning EP holders or overseas foreign professionals
• Minimum salary: S$22,500/month (fixed)
• Not tied to specific employer (more flexibility)
• Cannot be renewed - valid 3 years, one-time only

EntrePass

• For foreign entrepreneurs starting an innovative business
• Requires business to be <6 months old at application, or not yet incorporated
• Must meet innovation criteria (funding from recognized VCs, IP ownership, incubator support, etc.)
• Renewal requires meeting business milestones (employment/spending)

Dependent's Pass (DP) Holders

• Spouses/children of EP, PEP holders can work but need a Letter of Consent (LOC) from MOM (no separate work pass needed, but employer must apply)
• DP holders cannot start a business without proper authorization

Long-Term Visit Pass (LTVP)

• Some LTVP holders may work under LOC scheme, case-by-case

Permanent Residents (PR)

• Full right to work without additional permits
• Can be employed by any company or self-employed

Starting a Business as a Foreigner

Business Structure Options

• Private Limited Company (most common) - separate legal entity, limited liability
• Sole proprietorship/partnership - available but foreigners need local manager (see below)

Key Requirements

• Local resident director: At least one director must be a Singapore Citizen, PR, or EntrePass/Employment Pass holder with local residential address
• Foreigners can be 100% shareholders
• Must engage a registered filing agent (law firm, accounting firm, corporate secretarial firm) if not resident, to incorporate via ACRA (Bizfile+ portal)
• Minimum paid-up capital: S$1 (nominal)
• Must appoint a Company Secretary within 6 months of incorporation

Foreigner Physically Relocating to Run Business

• Need EntrePass (if starting fresh innovative venture) or
• Employment Pass (if company already operational and meets salary/COMPASS criteria)
• Simply incorporating a company does NOT grant right to work/reside in Singapore

Licensing

• Industry-specific licenses required (F&B, education, financial services, etc.) via GoBusiness Licensing portal
• Professional services (law, medicine, architecture) require local registration/certification

Foreign Investment Restrictions

Singapore is generally very open to foreign investment, but restrictions exist in:

• Media: Newspaper companies - Singaporean ownership/control requirements; broadcasting licenses restricted
• Property: Restrictions on land/residential property (see below)
• Financial services: Banking, insurance require MAS licensing; foreign banks face restrictions on number of branches/ATMs under certain categories (Qualifying Full Bank vs. Full Bank status)
• Legal services: Local law practice restricted to Singapore-qualified lawyers (foreign law firms need Joint Law Ventures or Formal Law Alliances for local law)
• Telecommunications: Foreign shareholding limits historically applied (largely liberalized)
• Defense-related industries: Government approval required
• Utilities/critical infrastructure: Government scrutiny under Significant Investments Review Act (2024) - allows government to block/unwind investments in entities deemed critical to national security

Property Ownership Rights

Residential Property Rules (under Residential Property Act)

Foreigners (non-PR):

• Cannot buy: HDB flats (public housing), landed property (without special approval from Singapore Land Authority - rare, requires significant economic contribution)
• Can buy: Private condominiums/apartments (freehold or leasehold) without restriction
• Buyer's Stamp Duty (BSD): Standard rates
• Additional Buyer's Stamp Duty (ABSD): 60% for foreigners buying any residential property (as of April 2023) - this is on top of standard BSD

Permanent Residents:

• Cannot buy new HDB flats directly from HDB (must wait 3 years as PR, and only resale flats, with restrictions - e.g., can't buy if citizen spouse not involved for certain schemes)
• Can buy resale HDB flats (with conditions - must sell within 6 months if buying private property, etc.)
• Can buy private property freely
• ABSD for PRs: 5% on first residential property, 30% on second, 35% on third+

Citizens (for comparison):

• ABSD: 0% on first property, 20% on second, 30% on third+

Commercial/Industrial Property

• No restrictions on foreign ownership - open market

Banking Access for New Immigrants

Opening Bank Accounts

• Major banks: DBS, OCBC, UOB, Standard Chartered, Citibank
• Required documents: Passport, employment pass/work permit, proof of address (sometimes tenancy agreement), sometimes reference letter from employer
• Some banks allow account opening before arrival for EP holders (via employer-linked schemes) or within days of arrival
• Initial deposit requirements vary (S$500-S$3,000 typically, fees apply if balance falls below minimum)

Practical Notes

• Work permit holders may face more scrutiny/limited account options compared to EP holders
• Credit history: No credit history transfer from abroad - immigrants start with no local credit score, affecting credit card limits/loan approvals initially
• Credit cards: Often require salary credit into local bank or fixed deposit as collateral for first 6-12 months
• CPF (Central Provident Fund): Mandatory for citizens/PRs only (not EP/S Pass/WP holders) - social security savings scheme with employer/employee contributions

Digital Banks

• Digital full banks (e.g., GXS Bank, Trust Bank) offer simplified onboarding, useful for newcomers

Labor Law Protections for Immigrant Workers

Employment Act (Cap 91)

• Covers most employees; extended significantly in 2019 to cover all employees regardless of salary for core provisions (previously capped at certain salary levels for some protections)
• Covers: working hours, overtime pay, rest days, annual leave, sick leave, public holidays
• Note: Managers/executives (PMEs) have some different provisions - no overtime pay entitlement under Part IV, but core protections (termination notice, salary payment timelines) still apply

Key Protections

• Salary payment: Must be paid within 7 days after end of salary period
• Itemized payslips: Mandatory
• Written key employment terms (KETs): Required within 14 days of starting employment
• Termination: Notice periods based on length of service (unless specified in contract); wrongful dismissal claims via Tripartite Alliance for Dispute Management (TADM)

Work Permit/S Pass Specific Protections

• Security bond: Employers must post bond (S$5,000) for Work Permit holders to ensure repatriation/compliance
• Medical insurance: Employers must provide medical insurance (minimum S$15,000 coverage) for Work Permit and S Pass holders
• Housing standards: Regulated dormitory standards for migrant workers (enhanced post-COVID)
• Salary Claims: Employment Claims Tribunals (ECT) handle disputes; TADM mediates first

Anti-Discrimination/Fair Employment

• Tripartite Guidelines on Fair Employment Practices (TGFEP) - not a hard law but enforced via Fair Consideration Framework; MOM can revoke work pass privileges for discriminatory hiring
• Fair Consideration Framework (FCF): Requires job advertising on MyCareersFuture for 14 days before EP applications (with exceptions for small firms/high salaries)

Migrant Worker-Specific Bodies

• Migrant Workers' Centre (MWC): NGO co-founded by NTUC and SNEF, assists work permit holders with disputes, salary claims, welfare issues
• Employment Agencies Act: Regulates recruitment agencies, capping placement fees to protect workers from exploitation

Repatriation & Passport Retention

• Illegal for employers to retain foreign workers' passports/travel documents (though S Pass/EP holders often voluntarily leave with employer for safekeeping - practice is legal only with genuine consent and worker must have access on demand)

Work Injury Compensation Act (WICA)

• Covers all employees including foreign workers for workplace injury/illness compensation, regardless of salary

Practical Recommendations

• Verify current salary thresholds at MOM website (changes roughly annually)
• Consult ACRA-registered corporate service providers before incorporating
• Engage property lawyers familiar with ABSD implications before purchasing
• Check IRAS for tax residency rules (183-day rule) affecting personal income tax rates
• Review CPF applicability if transitioning from EP/PR to citizenship
• For business investment restrictions, consult EDB or MAS for sector-specific rules
• Given recent regulatory changes (COMPASS framework 2023, Significant Investments Review Act 2024, ABSD hikes 2023), cross-check with official government sources (gov.sg, MOM, ACRA, IRAS) for most current requirements

More about immigrating to Singapore