The term “Strike Off” is used in Singapore to refer to the removal of an incorporated company from the Singapore Accounting and Corporate Regulatory Authority (ACRA). Any company, whether it’s a private company, public company limited by shares, exempt private company or public company limited by guarantee, can request the company name to be struck off the Register (per Section 344 of the Companies Act) maintained by ACRA.
There are a number of criteria that must be met, before the company can be officially closed. Generally, the striking off process applies to small companies or companies that never operated after incorporation. Larger companies would follow the criteria for winding up a business.
In either case, the goals of the process are to prevent individuals or companies that did business with the firm from being left with unfulfilled agreements, unpaid debts owed by the closing company or other potentially negative consequences associated with a business closing. A company involved in insolvency proceedings or disputes with creditors cannot use the striking off procedure.
Straightforward Rules
Requirements for striking off a Singapore company are straightforward and outlined by ACRA
- Company has either been dormant since incorporation or has ended all business activities
- No government related matters or indebtedness, including all taxes, are outstanding to any agency including the Inland Revenue Authority of Singapore
- Business is not involved in any court cases either in or out of Singapore
- There are no outstanding charges in the charge register of the business
- There are no current assets and liabilities on the balance sheet or there are clear provisions for final disposal or settlement
- Directors or Company Secretary do not have any outstanding ACRA summons
- A majority of shareholders have consented to the strike off procedures
- Final account reporting must include all activity up to the date business was ended
- Accounts must be audited if the business is required to meet mandatory audit requirements
- A dormant company is one in which no business activity has taken place since the company was incorporated, all bank accounts are closed, and an Annual General Meeting was not held or is not due to be held.
Bringing the Company to an End
The striking off process is initiated with submission of an Application for Striking Off to the Company Registrar at ACRA. The Registrar ascertains that all statutory requirements have been met. ACRA sends a Striking Off Notice to the company address, personal addresses of the company officers and tax agency stating that the company has met the requirements. A final notice is sent 4 months later. The time delay is to ensure there were no outstanding debts and/or creditor or shareholder issues yet to be resolved and to give any interested person a final opportunity to bring up objections to the striking off by filing a Lodgment of an Objection Against Striking Off. The Lodgment must be cleared before the striking off process is completed.
It’s important to get professional help with the striking off, so the process goes as smoothly as possible. Though, the procedures are clearly outlined, there are many steps that must be taken to certify that the legal requirements have been thoroughly and accurately met.
