The Singapore government has introduced stricter rules for the EntrePass scheme, which allows foreigners to set up businesses in Singapore. The new rules require applicants to register their company as a private limited concern, hold at least 30% shares, and have $50,000 in capital. They will also need to show they employ at least two Singaporeans and have $100,000 in business spending when renewing permits. Some foreigners are discouraged by the changes and worry that existing permit holders will face higher standards at renewal.

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Nov 4, 2009
Stricter rules for EntrePass get expats worked up
Foreigners who set up businesses here will have to hire S'poreans
By Ang Yiying
REVISIONS to a scheme for foreigners who want to set up businesses in Singapore are causing jitters
among some expatriates.
The amendments to the EntrePass scheme, made at the end of September, have made it more rigorous
for new applicants, but those already on it fear they too will be asked to meet the new, higher standards.
Previously, applicants for the pass had to submit a business plan and put down a $3,000 banker's
guarantee or get a Singaporean sponsor.
Now, new applicants also have to:
Register their company as a private limited concern;
Hold a share of at least 30 per cent in the company; and
Have at least $50,000 in paid-up capital
There are also specific guidelines to ensure that the businesses they set up create employment
opportunities for Singaporeans.
When they first renew the permits - each permit is valid for a maximum of two years - the business
owners will have to show that they employ at least two Singaporeans and have total business spending
of at least $100,000 over the past year.
At subsequent renewals, they have to employ at least four Singaporeans and have total business
spending of at least $150,000 over the past year.
The Ministry of Manpower (MOM), which administers the scheme, said the changes are a way of ensuring
that Singaporean workers benefit from enterprises set up here.
Said a spokesman: 'A key characteristic of the new EntrePass framework is the requirement for all
companies set up by EntrePass holders to employ locals.'
Asked if the change is due to businesses under the old EntrePass not giving jobs to Singaporeans, the
ministry said the old framework also considered employment creation, but the new framework has put
down mandatory business requirements.
MOM receives about 3,000 EntrePass applications a year, of which about half are approved. Those under
the old framework - about 1,700 - have been given a choice to stay on it or transit to the new
requirements.
Asked if those renewing their passes under the old framework will also be subjected to the more rigorous
assessment, the MOM would only say it is on a case-by-case basis.
The changes are already causing some concern among foreigners who had intended to come here to start
a business.
Mr Pardeep Boparai, head of business development at Janus Corporate Solutions, which runs a website
advising foreigners on how to do business here, said that about a third of those who had made enquiries
about EntrePass applications have decided not to proceed because of the new framework.
'Many of the EntrePass applicants thinking of running a one-man business are discouraged now. They are
not interested in applying for it any more,' he said.
Some current EntrePass holders are also worried - they fear that they will be held to the higher
standards when their permits come up for renewal.
Among them is Canadian Jonathan Kwan, who has been running Kwantum Leap - a career counselling
business - since July. He said he will opt to stay on the old framework when he renews his permit next
year, but is unsure if his business will meet the new requirements.
'I can't imagine them giving me a lower standard... I think they will push up the criteria,' he said.
The 31-year-old had not planned on hiring any help in the first three years of his business because he
wanted to establish himself first. He added that service- based businesses like his will have a hard time
chalking up total business spending of $100,000 a year.
'They're trying to close the gap a bit but not taking into consideration the businesses that are making a
difference but cannot meet the loftier requirements,' Mr Kwan said.
ayiying@sph.com.sg
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