How Can Mainland Companies Efficiently Establish Subsidiaries in Singapore? Exploring Viable Paths and Practical Experience

How Can Mainland Chinese Companies Establish a Subsidiary in Singapore? Exploring Efficient Pathways and Practical Insights

In recent years, as the global economic landscape continues to evolve, more and more Chinese mainland enterprises have turned their attention overseas in search of broader markets and a more stable business environment. Singapore, with its mature financial system, strategic geographical location, political stability, and a network of free trade agreements with multiple countries, has become a top destination for Chinese companies expanding internationally.

Especially against the backdrop of ongoing U.S.-China trade tensions and heightened global economic uncertainty, Singapore’s role as a global hub connecting Asia and the world has become increasingly prominent. According to a report from Lianhe Zaobao in early 2025, Chinese investment in Singapore has grown significantly over the past three years, particularly in the fields of technology, manufacturing, trade, and finance. Many mainland Chinese companies have chosen Singapore as a base to expand into Southeast Asia and beyond.

So, how can mainland Chinese companies successfully establish a subsidiary in Singapore? What are the key steps and practical experiences worth learning from? This article explores these questions in depth.

I. Why Singapore Attracts Chinese Enterprises

Before discussing the establishment process, it’s important to understand why Singapore is a preferred choice for setting up a subsidiary

1. Favorable Tax Regime

The maximum corporate income tax rate in Singapore is 17%, with the first SGD 100,000 of annual profits exempt from tax. Singapore has also signed double taxation avoidance agreements with over 80 countries and regions, enabling companies to optimize their tax structures.

2. Business-Friendly Environment

The World Bank consistently ranks Singapore among the easiest places in the world to do business. The government is known for its efficiency, and the company registration process is straightforward.

3. Mature Financial System

As one of the world’s leading financial centers, Singapore offers a well-developed banking, securities, and insurance infrastructure, making it easier for companies to manage capital and secure cross-border financing.

4. Rich Talent Pool

Singapore boasts a diverse and international workforce. With English as one of its official languages, it facilitates communication with global clients and partners.

5. Strategic Location

Situated at the heart of Southeast Asia, Singapore serves as a gateway to ASEAN markets, enabling companies to efficiently reach and serve the broader regional market.

II. Basic Steps to Establish a Subsidiary in Singapore

Despite Singapore’s business-friendly environment, setting up a subsidiary involves several key steps

1. Determine Company Structure and Name

Decide whether to establish a Subsidiary Company or a Branch Office. A subsidiary is a separate legal entity, offering greater flexibility and liability protection for long-term operations.

The company name must be checked for availability via the Accounting and Corporate Regulatory Authority ACRA.

2. Register the Company

Submit the registration application through ACRA’s BizFile+ system. Required information includes

Company name

Registered address

Details of directors and shareholders at least one director must be a Singapore tax resident

Constitution company bylaws

Business activities

In most cases, the registration process can be completed within one working day.

3. Open a Corporate Bank Account

After registration, a corporate bank account can be opened at local banks such as DBS, OCBC, or UOB, or international banks like HSBC or Standard Chartered. Some banks may impose additional requirements for non-resident shareholders, so early communication with the bank is advisable.

4. Apply for Relevant Licenses and Permits

Depending on the nature of the business, licenses may be required from regulatory bodies such as

Monetary Authority of Singapore MAS for financial services

Health Sciences Authority HSA for medical products

Committee for Private Education CPE for private educational institutions

5. Tax Registration and Compliance

Companies operating in Singapore must comply with local tax regulations, including

Corporate Income Tax

Goods and Services Tax GST

Employer obligations such as CPF contributions

Engaging a local accounting firm is highly recommended to assist with tax filings and compliance.

III. Practical Insights and Common Challenges

In practice, mainland Chinese companies may encounter several challenges when setting up a subsidiary in Singapore. Here are some valuable tips and recommendations

1. Engage Local Professional Services

Due to differences in language, legal systems, and business practices, it is advisable to work with local professionals such as law firms, accounting firms, or corporate registration agents. These experts can streamline the setup process and ensure compliance.

2. Prioritize Corporate Governance and Compliance

Singapore enforces strict regulations. Companies must maintain proper governance, including holding regular board meetings, keeping accurate financial records, and submitting annual returns on time. Non-compliance may damage the company’s reputation or even lead to revocation of the business license.

3. Strategic Tax Planning

While Singapore offers a favorable tax regime, multinational companies still need to plan carefully. Early consultation with a tax advisor can help leverage tax treaties, profit repatriation mechanisms, and other policies to optimize the overall tax burden.

4. Focus on Talent Acquisition and Localization

Hiring local talent can help companies better integrate into the market and improve operational efficiency. Singapore encourages the recruitment of skilled professionals through work passes such as the Employment Pass EP.

5. Leverage Government Incentives

Agencies such as the Economic Development Board EDB and Enterprise Singapore offer various support programs, including tax incentives, RD grants, and market expansion subsidies. Companies are encouraged to proactively explore and apply for these benefits.

IV. Conclusion

As the global economic landscape continues to shift, Singapore’s position as a premier international business hub has only strengthened. For mainland Chinese enterprises, establishing a subsidiary in Singapore represents not only a strategic step toward global market expansion, but also a critical move in enhancing international competitiveness and risk resilience.

By thoroughly understanding local regulations, strategically planning operational structures, and leveraging professional expertise, Chinese companies can achieve sustainable and successful growth in Singapore - a dynamic gateway to the world.