May 2025 Newsletter

This month’s Singapore jurisdiction update is very timely as the Corporate Service Providers (CSP) Act comes into force in only a few days’ time, ushering in a new regulatory era.

Although this new regime may mean increased due diligence, for us and our clients, it will also help to level the playing field across the sector and protect the reputation of Singapore as the best place in which to do business and through which to invest into and out of Southeast Asia.

CSPs are essential to ease the process when someone wants to set up shop in Singapore. Our focus is to help businesses by providing strategic advice and implementing practical structures and steps that will help drive revenue, efficiency and growth. These companies may create good jobs in Singapore and boost the economy.

To do this, we need to ‘know our customer’. We must analyse their current position and offer recommendations that will address challenges and deliver results at both a local and international level.

But is not just about setting up companies. It is important to have checks and balances to ensure the legitimacy of the individual or the firm being set up. We play a vital role in protecting Singapore’s business landscape and reputation by ensuring a basic level of compliance through registrations and filings.

It its last Mutual Evaluation of Singapore in 2016, the Financial Action Task Force (FATF) assessed that Singapore has a strong legal and institutional framework to fight money laundering and that its anti-money laundering coordination was sophisticated and comprehensive.

But as recent events have shown, money laundering trends are constantly evolving. This means the regulators and the sector needs to be agile. Singapore’s next Mutual Evaluation is taking place this year, so it is essential that the government has responded so swiftly and decisively to protect our reputation as a trusted financial hub.

It is also gratifying to see the surge in Singapore’s family office sector. Singapore and Hong Kong punch far above their economic weight as financial hubs, and that extends to family offices. Both jurisdictions boast mature financial ecosystems with access to traditional and non-traditional investments, paths to residency for investors who meet certain criteria and access to talent.

According to McKinsey analysis, the two cities are together home to some 15% of the world’s single-family offices and are actively seeking to attract more through tax incentives and clear regulations. It also found that ultra high net worth individuals in Asia-Pacific have a strong preference for single-family offices that allow them to maintain tighter control over their wealth.

The wealth currently flowing into Singapore is largely from within the Asia-Pacific region, but investment from Europe and North America could increase as global investors see Asia-Pacific as a region for diversification.

This will affect service providers’ operating models and geographical presence as they serve family offices across multiple jurisdictions. With our local knowledge and our global expertise and footprint, Sovereign is well placed to assist. Please contact us.

Andrew Galway

Managing Director Sovereign Management Services Pte. Ltd.