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[ESTABLISHING A BUSINESS ENTITY IN SINGAPORE]
partners and the Limited Liability Partnerships Act 2005. This structure is generally used for professional practices such as doctors, lawyers, architects and engineers etc. Separate Legal Entity Like a company, the LLP is a separate legal entity from the partners. This means that any change in the partners of an LLP will not affect its existence, rights or liabilities. Although the partners of the LLP will not be held personally liable for any business debts incurred by the LLP, a partner may, however, be held personally liable for claims from losses resulting from his own wrongful act or omission. A partner will not be held personally liable for wrongful acts or omissions of any other partner of the LLP. Partners The LLP must have at least two partners. The partner can be an individual (at least 18 years old of full legal capacity), a local company, a foreign company or another LLP. Partners are considered agents of the LLP. Manager There must be at least one manager to oversee or take part in the management of the LLP. The manager is responsible to ensure that the LLP complies with the requirements of the Limited Liability Partnerships Act 2005. The manager must be an individual ordinarily resident in Singapore. He/she may be a partner of the LLP. The manager cannot be an undischarged bankrupt unless with leave of the High Court or written permission of the Official Assignee.
Statutory requirements An LLP is required to keep accounting records, profit and loss accounts and balance sheets that will sufficiently explain the transactions and financial position of the LLP. The LLP must submit an annual declaration of solvency or insolvency which will be made available to the public. (6) Sole Proprietorship A sole proprietorship is a business that can be owned and controlled by a sole individual, a
company or an LLP. Unlimited liability
The sole proprietorship is not a separate legal entity from the business owner (sole proprietor). The sole proprietor has unlimited liability and will be personally liable for all debts and losses of the sole proprietorship. The sole proprietor will have to sue and be sued in his own name. Sole proprietor A sole proprietor must be:- (1) at least 18 years old and of full legal capacity; (2) a Singapore Citizen, Singapore Permanent Resident, or a foreigner holding an EntrePass. Authorised representative Sole proprietors who are foreigners residing overseas must appoint at least one locally- resident authorised representative. (7) Business Trusts A Business Trust is a trust created under a trust deed to operate and run a business enterprise. Business trusts which meet certain criteria stipulated in the Business Trusts Act 2004 will have to be registered under the Act. Business
ILN Corporate Group – Establishing a Business Entity Series
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