Singapore's company limited by guarantee

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Singapore has neither a foundation nor an association with legal personality in the Swiss sense. The wrapper that emerged from 2018 onward is the company limited by guarantee (CLG) under s. 17 of the Companies Act 1967. A CLG has no share capital. Its members undertake to contribute a nominal sum, typically S$ 1 to S$ 10, if the company is wound up. It is managed by directors who owe the ordinary duties of company directors. It may not distribute profits to members and must apply its income to its objects. Many protocols incorporated CLGs in Singapore between 2018 and 2022 and called them "foundations" in their public materials, which they are not.¹

The CLG works adequately as a grant-making and ecosystem body. It works poorly as a DAO wrapper for three reasons. Its members are the guarantors named in its constitution and cannot be an open class of token holders without a mechanism the Act does not contemplate. Its directors control it and are liable for it, so a DAO vote cannot bind them in law. And it is a company, so it must file accounts, have a resident director, hold meetings and comply with the Companies Act in full. The CLG was popular in Singapore because it was the only available form and because until 2022 MAS and ACRA paid it little attention. After the Terraform and Three Arrows collapses, which involved Singapore entities, scrutiny of protocol CLGs increased, and after the DTSP regime took effect on 30 June 2025 a CLG that performs any digital token service for persons outside Singapore needs a licence it will not receive. Many protocol CLGs were wound up or redomiciled during 2025.²

Singapore perspective

A protocol with Singapore roots that still holds its treasury in a Singapore CLG should review three points before the end of 2026. First, does the CLG perform any activity that is a digital token service under Part 9 of the FSMA 2022, such as holding tokens for others, operating a front-end or facilitating transfers? If so, it is operating without a licence. Second, do the directors understand that they are personally responsible for the CLG's compliance and cannot defer to a DAO vote? Third, would the treasury be better held in a Swiss foundation, with the Singapore entity reduced to a development or grants company? Part P, Chapter IV works through the redomiciliation.

Notes

Companies Act 1967 (Singapore), s. 17(2) (company limited by guarantee), s. 29 (power to omit "Limited" from the name for non-profit companies) and Part 5 on directors' duties. Part P, Chapter III. ↩
Terraform Labs Pte Ltd was a Singapore private company; the Luna Foundation Guard was a Singapore CLG. The post-2022 scrutiny and the DTSP consequences are recorded in Part I, Chapter III and Part K, Chapter V. ↩

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of October 2026.

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Dr Alexander Ressos, TEP

Of Counsel, KGP Legal LLC

I am Of Counsel with KGP Legal LLC in Singapore, where I work with a global client base of successful entrepreneurs and their families, independent asset managers, commodity trading houses and other commercial clients. I am a German and Swiss attorney-at-law, also admitted as a solicitor in England & Wales and in Hong Kong. I divide my time between Zug in Switzerland, Singapore and Hong Kong. Since 2017 I have advised international clients on more than 700 crypto and digital asset projects. I also have extensive experience in cross-border litigation and arbitration in Singapore, Hong Kong and other markets in South-East Asia and Greater China.

I operate across the key financial centres in South-East Asia, the Middle East and Switzerland, with a particular focus on asset protection, international tax and estate planning, as well as trusts, company administration and other fiduciary services. My philosophy is to serve as a trusted advisor working closely with my clients and to help them achieve their commercial objectives.

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SingaporeIQ is edited by Dr Alexander Ressos, an international business lawyer with more than 15 years of local experience in Singapore as a permanent resident, a Singapore registered foreign lawyer and managing partner of a Singapore foreign law practice. In addition to significant experience in cross-border investments and transactions, UHNWI private client work and sanctions/export controls, Dr Ressos has extensive experience in cross-border business and in crypto and digital-asset projects in Singapore, drawn from more than 700 projects since 2017.

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