Practical consequences for trading companies

Planning an application

For a trading company considering Singapore, the programme is one element in a broader decision. The company must first determine which functions it intends to locate in Singapore: trading desks, risk management, operations, finance, treasury and compliance. These functions determine the headcount and the local spending that the company can commit. They also determine the transfer pricing position of the Singapore entity and thus the income to which the concessionary rate will apply.

The second question is the scale of the group. A group within the scope of the global minimum tax will gain little from a rate below 15 per cent and should plan on that basis. A smaller trader below the threshold of 750 million euros can still benefit from the 5 or 10 per cent rates if its commitments justify them. In both cases, the award confers recognition by the state, eases relations with banks and counterparties and signals a long-term commitment to Singapore.

Compliance during the award

Once approved, the company must meet the conditions of its award and keep records that allow its qualifying income to be separated from other income. It reports its performance against its commitments and prepares for renewal at the end of the award period. Changes in the business, such as a move of trading desks to another hub, an acquisition or a new line of commodities, may require consultation with the agency. Since the collapses of 2020, which Chapter II of Part H examines, banks and authorities pay closer attention to the governance, risk management and financial reporting of trading companies. The programme’s requirement to perform compliance and risk management functions in Singapore has gained practical weight.

Checklist for trading companies

Define the functions to be performed in Singapore (trading, risk management, operations, finance, treasury, compliance) and document them for transfer pricing purposes.
Assess the group’s position under the Multinational Enterprise (Minimum Tax) Act 2024 before negotiating a concessionary rate.
Check the current list of qualifying commodities, which since 13 February 2026 includes Environmental Attribute Certificates, and the activities covered by the award.
Prepare realistic commitments on turnover, local business spending and the number of trading professionals, since performance is compared with them at renewal.
Keep separate accounts for qualifying and non-qualifying income and maintain records that support the qualifying nature of each transaction.
Use the local banking, logistics, arbitration and other support services that the programme expects, and document their use.
Verify the current text of section 43I and its cut-off date on Singapore Statutes Online, since the extension to 31 December 2031 depends on legislation.

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.

All Singapore law advice is provided through KGP Legal LLC, an established and duly licensed firm of Singapore advocates and solicitors.

KGP Legal LLC is a medium-sized law firm in Singapore that is capable of providing the full range of legal services and corporate administration work. Please contact me directly at [email protected] if you need any further information.

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Setting up or expanding in Singapore?

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.

If you are planning a company incorporation, an investment, a holding structure or a market entry through Singapore, you can reach Dr Ressos directly at [email protected]. Singapore law advice is provided by KGP Legal LLC, a licensed firm of Singapore advocates and solicitors. Dr Ressos and his team facilitate the full range of Singapore legal, compliance and company administration services, including company incorporation, corporate transactions, commercial contracts, crypto and digital assets, financial regulatory work and dispute resolution, including litigation in the Singapore courts. For legal, tax and fiduciary services in Switzerland, see helveticaregister.com.