Requirement and procedures for lodging charges of a company with ACRA
Businesses may need to raise money in the course of its operations. When a company applies for a loan from a bank or other institutions, it will often give security to the creditor. One common form of security is a charge over assets.
Definition of a Charge
A charge is a form of security interest usually taken by a lender or creditor (“chargee”) to secure repayment of a loan.
Types of Charges
A charge secured on fixed assets (e.g. land and buildings, a ship, piece of machinery, shares, intellectual property such as copyrights, patents, trade marks, etc.)
A charge secured on non-specific assets or generic categories (e.g. inventory, cash, stocks, accounts receivable).
A floating charge ‘floats’ over the secured assets. It is only converted into a fixed charge if, for example, the company fails to repay the loan.
Registering a New Charge
When a charge is created, it must be registered with ACRA.
The following charges must be registered:
a charge to secure any issue of debentures
a charge on uncalled share capital of a company
a charge on shares of a subsidiary of a company which are owned by the company
a charge created or evidenced by an instrument which, if executed by an individual, would require registration as a bill of sale
a charge on land wherever situate or any interest therein
a charge on book debts of the company
a floating charge on the undertaking or property of a company
a charge on calls made but not paid
a charge on a ship or aircraft or any share in a ship or aircraft
a charge on goodwill, on a patent or a licence under a patent, on a trade mark or a licence to use a trademark, or on a copyright or a licence under a copyright or on a registered design or a licence to use a registered design
Duty to Register Charges on Property Acquired
Registering a charge applies to all Singapore-registered local and foreign companies.
When to Register
A charge must be lodged with the Registrar for registration within 30 days after the creation of the charge.
Registration of Charge
Where a charge is created by a company there must be lodged with the Registrar for registration a statement containing the prescribed particulars of the charge.
Company Officers may submit an online application for lodgement of new charge on the company’s behalf. Alternatively, the company director may submit the filing.
Information Information required to complete the process of Registration of Charge:
1. Unique Entity Number (UEN) 2. Date of creation of charge 3. Instrument evidencing the charge 4. Chargee Details 5. Amount Secured by the charge.
Upon the application of the company and payment of the prescribed fee, application will be processed and approved after submission.
ACRA will send an email notification confirming the registration of the charge. The email notification will serve as conclusive evidence that the requirements as to registration have been complied with.
Every company must keep the instrument of charge at the registered office of the company for as long as the charge to which the instrument relates remains in force.
Variation of Charge
A variation of charge is an agreement to vary the terms of the original charge (e.g. a variation of the amount secured or the chargee). The applicant can submit variation of charge related to chargee details, amounts secured and variation description. This transaction can be filed by the Company Officers.
No fee is payable for filing this transaction.
Information Information required to complete the process of Variation of Charges: 1. Unique Entity Number (UEN) 2. Charge Number. 3. Supporting Document for Variation of Charge
Filing of Satisfaction of Charge and Release of Property from Charge
Where, with respect to any registered charge, the company's debt for which the charge was given has been paid or satisfied in full or partially paid; or the property or undertaking charged has been released from the charge or has ceased to form part of the company’s property or undertaking of the company concerned, the company needs to lodge with ACRA a statement of satisfaction in whole or in part, or of the fact that the property or undertaking has been released from the charge or has ceased to form part of the company’s property or undertaking (as the case may be) in order to release the charge.
The statement must be endorsed with a statement by the chargee of the payment, satisfaction, release or ceasing (as the case may be).
Upon successful filing, the charge will be removed from the company's register.
This transaction can be filed by the Company Officers.
Information Information required to complete with the process of Satisfaction of Charges: 1. Unique Entity Number (UEN) 2. Charge Number 3. Date of Satisfaction/Partial satisfaction of charge 4. Supporting Document for satisfaction of charge
There is no fee payable for filing this transaction.
Charge Registration Services
Companies may engage Bestar to submit charge related application such as registration of new charge, statement of satisfaction ('Satisfaction of Charge'), etc. with ACRA on the companies’ behalf.
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