In Singapore, there are nine free trade zones that allow companies to import, sell, or export goods without customs, duties, or goods and services tax (GST). They are:

–          Brani Terminal;

–          Keppel District Park;

–          Tanjong Pagar Terminal and Keppel Terminal;

–          Jurong Port;

–          Sembawang Wharves;

–          Pasir Panjang Wharves,

–          Changi Airport Group;

–          Changi Airport Cargo Terminal Complex;

–          Singapore FreePort located in the Airport Logistics Park.

 

These zones are regulated by the Free Trade Zones Act which was last amended in 2014, and it allows companies to temporarily store their goods until they are loaded for export without customs clearance. The law mainly covers the following:

  • The respective authorities are responsible for verifying the activities conducted by the companies in these zones.
  • The activities allowable by free zone companies in Singapore
  • The types of licenses and permits necessary to carry out such activities in the free zones
  • The penalties for not abiding by the regulations imposed by the authorities

 

To incorporate a free zone company, it is the same procedure as incorporating any other company in Singapore. From there, the free zone company will need to obtain a permit from PSA Corporation Authority and TradeNet for permission to import, export and transport their goods overseas.

 

The next thing to note is that the minimum share capital to set up a free zone company is S$100,000 and S$50,000 if the company requires warehousing spaces and office spaces respectively.

 

There are two types of licenses that are required to operate in Singapore free trade zones, one for corporate users, and the other for individuals with limited validity, lasting between 24 hours to 2 weeks. In the case for corporate users, it can last 1 or 3 years depend on the companies’ requirement and varying fees will apply. The application process takes about 4-7 days’ time.

 

The advantages of free trade zone companies in Singapore are:

  • No permits or licenses are required for the trans-shipment of goods in the free zones
  • No custom duties for goods transiting or stored in the free zones
  • No GST applicable on goods imported into the free zones
  • Custom procedures are streamlined for companies operating in the free zones.

 

The two largest free zones in Singapore are Jurong Port and Changi Airport, with the former accessing to the largest river in Singapore, and the latter being the largest and busiest airport in the region.

 

To find out more about incorporation matters, feel free to approach us for a non-obligatory discussion.