I INTRODUCTION TO THE IMMIGRATION FRAMEWORK

There are very few formalities required to visit Singapore on business. The passports of most countries are accepted for entry to Singapore without a visa. A visit pass valid for 30 days – 60 days for persons holding an APEC Business Travel Card – is normally issued upon arrival in Singapore, and covers visits for ‘social, business or professional purposes or as a tourist’.

In specified situations, a person may apply for an exemption to work in Singapore for up to 60 days without a work pass. Otherwise, a work pass is required to engage in any employment, trade, vocation or profession. Applying for work passes in Singapore is a relatively smooth and uncomplicated process, although in the first quarter of 2017 the processing time for work pass applications has increased to about three weeks (whereas previously applications were commonly processed within a week). The Ministry of Manpower (MOM) issues the following passes to live and work in Singapore:

  • a a work permit for low-skilled workers, maids, confinement nannies, and certain performing artists;
  • b an S pass for mid-level skilled workers and technicians;
  • c an employment pass for professionals, managers, executives, and more highly paid or highly skilled workers;
  • d a personalised employment pass (PEP) for the highest-earning professionals, managers and executives; and
  • e an EntrePass for entrepreneurs intending to start new businesses in Singapore and intending to contribute to local employment.

Work passes are, as a matter of practice, issued for 12 to 24 months at a time, and may be renewed as early as six months prior to expiry.

Investors and professionals, technical personnel or skilled workers can apply to live in Singapore on a more settled basis as permanent residents. A person may include his or her spouse and children under 21 years in an application for permanent residence. Singapore permanent resident status is effectively granted for three or five years at a time, and may also be renewed prior to expiry. Permanent residents do not require work passes to engage in employment, etc.

Permanent residents may apply to become Singapore citizens by registration. If the application is granted, the person must renounce his or her foreign citizenship before becoming registered as a Singapore citizen.

i Legislation and policy

The primary immigration-related statutes are the Constitution, the Immigration Act, the Employment of Foreign Manpower Act and the Enlistment Act.

The Constitution of the Republic of Singapore contains the provisions governing citizenship by birth, descent, registration and naturalisation, renunciation of citizenship and deprivation of citizenship.

The Enlistment Act obliges Singapore permanent residents and citizens to perform both full-time and ‘operationally ready’ (i.e., reservist) national service in the armed forces.

The Immigration Act and the Immigration Regulations govern visas and visit passes for travel and entry to Singapore, and entry and re-entry permits for Singapore permanent residents.

The Employment of Foreign Manpower Act regulates work passes for the employment of persons who are not citizens or permanent residents of Singapore.

Other than the main immigration legislation, employers should also be aware of employment guidelines such as the Tripartite Guidelines on Fair Employment Practices, which are used by the MOM to investigate complaints of unfair employment practices (e.g., unreasonably recruiting foreigners in preference to locals).

ii The immigration authorities

The MOM facilitates and regulates the employment of foreigners in Singapore. In particular, the Work Pass Division of the MOM administers the work passes under which non-permanent-resident foreigners are permitted to live and work in Singapore.

The Immigration and Checkpoints Authority (ICA) is the division of the Ministry of Home Affairs that performs immigration and registration functions such as the issuing of travel documents and identity cards to Singapore citizens, and various immigration passes and permits to foreigners. For instance, foreigners who are granted permanent residence receive an entry permit to ‘enter and reside in Singapore’, a National Registration Identity Card, and a re-entry permit – generally valid for three or five years at a time – to re-enter Singapore as a permanent resident after travel abroad. The issuance is administered by the ICA. The ICA is also responsible for border security at the country’s land, sea and air checkpoints.

The Standards, Productivity and Innovation Board (SPRING) is an agency of the Ministry of Trade and Industry responsible for small and medium-sized enterprise development. Together with the MOM, it jointly assesses applications for EntrePasses to start businesses in Singapore.

The Economic Development Board (EDB) is Singapore’s foreign direct investment agency. Together with the ICA, the EDB administers the Global Investor Programme (GIP). This is the permanent residency programme for investors.

At 18 years of age, male permanent residents and citizens of Singapore are required to enlist for two years’ full-time military service in the Singapore armed forces. From the age of 13 years and until he completes his full-time national service, a Singapore citizen or permanent resident intending to travel and remain outside Singapore for three months or more requires an exit permit from the Ministry of Defence (Mindef), which administers and enforces the Enlistment Act. When he is posted to the reserves after his full-time national service and until the age of 40 or 50 (depending on rank) a citizen or permanent resident will also require an exit permit from Mindef to travel and remain outside Singapore for six months or more.

iii Exemptions and favoured industries

Work pass-exempt activities (for not more than 90 days in a calendar year) are permitted without taking out a work pass provided that the MOM receives notification beforehand. In principle, failure to notify the MOM that a person is carrying out a work pass-exempt activity in Singapore is subject to the same penalties as working (and employing the person) in Singapore without a pass.

The following are work pass-exempt activities:

  • a performing as an actor, a singer, a dancer or a musician (or involvement as a key support member of staff) in an event supported by the government or any statutory board, or in an event at a venue to which the public or any class of the public has access (free or paid), such as a theatre or a concert hall. It excludes performing at entertainment outlets certified with a public entertainment licence (such as bars, discotheques, lounges, nightclubs, pubs, hotels, private clubs and restaurants); in the latter case, a work permit (performing artists) is required;
  • b journalism activities (including media coverage for events or media tours) supported by the government, or any statutory board constituted by or under any written law for a public purpose;
  • c involvement by sportspeople, coaches, umpires, referees and key support members of staff in sports competitions, events or training supported by the government or any statutory board constituted by or under any written law for a public purpose (other than being engaged as a sportsperson of a Singapore sports organisation pursuant to a contract of service);
  • d activities of actors, models, directors, film crew or technical crew and photographers in location filming or fashion shows;
  • e organising or conducting seminars, conferences, workshops, gatherings, or talks by speakers, moderators, facilitators, and trainers, provided that the event: (1) does not relate directly or indirectly to any religious belief or to religion generally; (2) does not relate directly or indirectly to any race or community generally and (3) is not ‘cause-related’ or directed toward a political end;
  • f commissioning or auditing new plant and equipment (including any audit to ensure regulatory compliance or compliance with one or more standards) by an expert or specialist;
  • g providing specialist skills or expertise that are not available in Singapore or that are to be provided by the authorised service personnel of the manufacturer or supplier of the equipment, in the installation, dismantling, transfer, repair or maintenance of equipment, processes or machines;
  • h participating in exhibitions of trade fairs as an exhibitor or a trader (this does not include trade fairs that require a trade fair permit issued under Section 35 of the Environmental Public Health Act);
  • i acting as an arbitrator or mediator, provided that the case or matter: (1) does not relate directly or indirectly to any religious belief or to religion generally; (2) does not relate directly or indirectly to any race or community generally and (3) is not ‘cause-related’ or directed toward a political end;
  • j organising, promoting, or conducting an event in a casino by: (1) event representatives employed by an event promoter whose principal place of business is situated outside Singapore; and (2) self-employed event promoters whose principal place of business is situated outside Singapore or whose principal business activity is conducted outside Singapore (event representatives and promoters must hold valid event representative and promoter licences issued by the Casino Regulatory Authority); and
  • k facilitating tours by tour leaders or tour facilitators employed by companies whose principal places of business are situated outside Singapore or whose principal businesses are conducted outside Singapore.

II INTERNATIONAL TREATY OBLIGATIONS

Singapore is a member of the World Trade Organisation (WTO). As such, it is a party to the WTO’s General Agreement on Trade in Services (GATS). The normative requirement to advertise a job opening on the national Jobs Bank and consider local applicants for the job before applying for an employment pass is waived with respect to ‘intra-corporate transferees’ as defined by the WTO GATS.

A Comprehensive Economic Cooperation Agreement (CECA) exists between India and Singapore. Chapter 9 of the CECA pertains to the Movement of Natural Persons. Since 2011, Singapore has progressively raised the criteria for the employment of expatriates. (See Section III, infra.) These measures have progressively impeded the ability of Indian companies (particularly IT outsourcing companies) operating in Singapore to employ Indian citizens in their Singapore operations essentially at will. The Indian view is that the raised work pass criteria introduced since about 2012 are inconsistent with Singapore’s obligations under the CECA. The Indian view is that the CECA was intended to avoid salary benchmarking and labour market testing in particular. As such, the application of increasing salary thresholds for work pass applications and the ‘Fair Consideration Framework’, respectively, are seen as violations of the CECA.

III THE YEAR IN REVIEW

In 2016, the number of citizens and permanent residents in employment in Singapore was under 2.2 million. The number of work passes issued to foreigners was over 1.4 million. Thus, almost 40 per cent of the people in employment in Singapore last year were non-permanent-resident foreigners. The percentage of foreign nationals in the work force is even higher if permanent residents (non-Singapore citizens, by definition) are weighed on the foreign side of the balance. Both the proportion and the absolute number of foreigners working in Singapore have become politically sensitive. In particular, there were almost 190,000 professionals, managers and executives (PMEs) in Singapore with work passes in 2016. They made up more than 5.3 per cent of the total workforce.

There is no formal quota for the number of foreigners a company can hire on employment passes. And, at one time, Singapore had, in effect, an equal-opportunity employment policy from the immigration point of view. In other words, foreigners competed with locals on a largely level playing field for executive positions. In other words, there was virtually no barrier or impediment to foreigners entering the Singapore job market in the immigration procedures. The level playing field policy for both foreigners and locals meant that the number and proportion of foreigners in the workforce reached controversial levels in recent years.

With effect from 1 January 2017, the minimum qualifying monthly salary for new employment pass applications is S$3,600 (up from S$3,300 previously). In 2011, the minimum salary for employment passes was S$2,500. In other words, in a reversal of the earlier policy, the MOM has progressively raised the minimum salary to employ an expatriate PME by 44 per cent in six years. One aim of the rising salary threshold is to encourage employers to hire local tertiary graduates, who may have lost out in job opportunities to more experienced foreign PMEs willing to work in Singapore for lower pay. More broadly it is part of the current ‘local first’ policy for PMEs that has developed by stages over the past few years.

In addition to raising the minimum qualifying salary, the MOM has also been paying closer attention and become more discriminating with regard to the universities and colleges from which foreign applicants obtain their degrees.

In 2014 a Fair Consideration Framework (FCF) was formally introduced. This advanced the Singaporeans first policy by, among other things, requiring businesses to first offer a PME position to prospective local candidates by posting such openings on a national Jobs Bank before the employer can apply for an employment pass. Exceptions to the requirement to consider local candidates first are businesses with 25 or fewer employees, jobs paying a fixed monthly salary of S$12,000 or more, and intra-corporate transferees (within the WTO GATS definition).

As part of the FCF the MOM began to audit companies with disproportionately few local PMEs (compared with others in the same industry), or that had been the subject of complaints of nationality-based discriminatory hiring practices. Specifically, it inspected companies’:

  • a organisational charts for the nationalities of employees;
  • b recruitment processes;
  • c staff grievance-handling procedures;
  • d employee-progression framework; and
  • e plans to develop local staff to take on higher roles or reduce reliance on foreigners on employment passes.

In August 2015, it was reported that 150 companies had been ‘engaged’ in this way in the FCF’s first 12 months. Of these, 38 had been identified as requiring ‘closer scrutiny’ on account of having a ‘weak Singapore core’ and a ‘weak commitment to fair consideration in hiring and developing Singaporeans’. It was also reported that another 100 companies had been identified for ‘further engagement’ for being ‘outliers’ in their respective industries.

In an update given to Parliament in March 2017, the Manpower Minister said that about 50 of the 250 companies on the MOM’s watchlist had been ruled to be uncooperative. As a result, more than 500 employment pass applications from these companies had been not been approved. In contrast, the other companies had responded positively by hiring between them more than 800 local PMEs since being placed on the watchlist.

As mentioned in the Introduction, in the first quarter of 2017 the MOM publicly announced that its processing time for work pass applications has increased to about three weeks (whereas previously applications were commonly processed within a week). At the same time, it was reported that 74 companies had been identified as having employment practices ‘over and above what is fair and legal’. These employers have been inducted by the MOM into a new Human Capital Partnership programme, one of whose benefits was speedier processing of their employment pass applications.

IV EMPLOYER SPONSORSHIP

Most work passes require employer sponsorship. The work pass framework largely only caters to persons who already have firm offers of jobs in Singapore. Work passes are not granted to jobseekers. A work pass is also specific to an employment and must be surrendered for cancellation when a person leaves his or her employer. The exception is the PEP, which, as the name suggests, is personal to the holder so that he or she can use it from one job to another for the duration of the pass; and the EntrePass, which is granted to qualifying self-employed individuals.

The sponsor company is normally expected to be a well-established, Singapore-registered company. It is expected to furnish the respective numbers of its local (i.e., citizen and permanent resident) and foreign employees, and its business turnover for the past three years, as part of the work pass application. In the case of a newly incorporated subsidiary, it is possible to get around the lack of a business record in Singapore and to establish one’s bona fides by capitalising the subsidiary with a respectable level of paid-up share capital or by disclosing the financials of the parent company.

A Singapore company can be wholly foreign-owned; there is no local shareholding requirement. But a company must have at least one director who is ordinarily resident in Singapore. The resident director need not be a Singapore citizen or permanent resident. A person holding a work pass can qualify as a resident director.

The sponsor is required to certify, confirm and ensure that:

  • a the work pass application is made for the purpose as stated by the foreign employee;
  • b the information set out in the application is true and correct; and
  • c the foreign employee fully understands the declarations made in his or her application.

It is necessary to keep copies of the foreign employee’s educational certificates as declared in the application form for the duration of the foreigner’s employment.

i Work permits

The relevant work passes for professionals, executives, business owners and mid-level to highly skilled workers are the employment pass and the S pass.

Employment pass

The basic requirements to be considered for an employment pass are a fixed monthly salary of S$3,600 for young graduates, rising with age and experience and also acceptable qualifications (as defined below).

Fixed monthly salary

For the purposes of evaluating an employment pass application, ‘fixed monthly salary’ means basic salary and fixed allowances; that is, remuneration and allowances that do not vary from month to month; regardless, for example, of employee or company performance. It excludes:

  • a overtime payments, bonuses, commissions, or annual wage supplements;
  • b in-kind payments;
  • c reimbursements;
  • d productivity incentive payments;
  • e contributions by the employer to any pension or provident fund (including contributions made on the employee’s behalf); or
  • f any gratuity payable on discharge, retrenchment or retirement.
Acceptable qualifications

Acceptable qualifications include:

  • a good degrees (see below);
  • b professional qualifications;
  • c specialist skills; or
  • d a proven track record and exceptional skill set.

Degree-awarding institutions are recognised according to their global and country rankings by independent accreditation boards (such as QS World University Rankings and the Academic Ranking of World Universities), the employment outcomes of their graduates and their enrolment standards.

Most employment pass applications are submitted online. An employer must first register for the online employment pass application system. Setting up the EP Online account (a one-time procedure) takes about a week. Then the MOM take about three weeks to decide an employment pass application.

Hard copy applications (save for one category of employment pass for which the processing time is eight weeks) have been phased out.

It is possible to request an employment pass for up to 60 months. In practice, employment passes are mostly granted for 12 or 24 months at a time. However, they are renewable indefinitely subject to:

  • a checks by the MOM with the Inland Revenue Authority of Singapore on the taxpaying record of the individual;
  • b the business performance of the employer continuing to justify the person’s employment; and
  • c the employment pass policy and criteria prevailing at the time of renewal.

An employment pass does not require the holder to be physically present in Singapore for any minimum number of days in a year.

PEPs

A PEP is intended for the highest-earning professionals, managers and executives. Unlike sponsored work passes, a PEP is specific to the holder and will not be cancelled when the PEP holder leaves his or her employment; the MOM merely has to be notified of each change in the holder’s employment status. The holder may remain in Singapore on the PEP for up to six months between jobs.

A PEP is issued only once, for a three-year duration, and cannot be renewed. The intent behind the PEP is that the person will, after three years in Singapore, take the next step of applying to become a permanent resident and assimilate into the Singapore talent pool.

The basic requirement for a foreign national to obtain a PEP is a last-drawn fixed monthly salary of S$18,000 or more. The foreigner must file the PEP application within six months of the last drawn salary. An employment pass holder (ie, an individual who is already working in Singapore) whose fixed monthly salary is S$12,000 or more may also apply for a PEP. The entire process usually takes about eight weeks.

The PEP is not available to self-employed freelancers, sole proprietors, partners, company director–shareholders, journalists, editors, subeditors or producers.

PEP applications must be made in hard copy, not online. PEPs have the same dependant privileges as employment passes.

EntrePass

The EntrePass is intended for foreign entrepreneurs to start new businesses in Singapore and contribute to local employment. As such, an EntrePass application normally involves a proposed company rather than an already existing local sponsor or employer.

The EntrePass is issued for 12 months at a time and, as such, must be renewed every year. The EntrePass application requires the applicant to provide his or her work experience as well as a detailed business plan. The required business form is a Singapore private limited company. The company must have a paid-up share capital of not less than S$50,000, and the EntrePass holder must own at least 30 per cent of the shares in the company. The company must also:

  • a receive at least S$100,000 funding from an unrelated venture capitalist or business angel that is accredited by a Singapore government agency;
  • b hold intellectual property related to its business contributed by one or more of the shareholders and registered with the Singapore Copyright Office or an approved foreign IP institution;
  • c be involved in ongoing research collaboration with a research institution recognised by the Agency for Science, Technology and Research or institutes of higher learning in Singapore; or
  • d be an incubatee at a Singapore government-supported incubator.

EntrePass applications are made in hard copy, and assessed jointly by the MOM and SPRING Singapore.

Renewal of an EntrePass every 12 months depends on employment created for locals (ie, Singapore citizens or permanent residents) and business expenditure:

After year

No. of local employees

Minimum business expenditure

1

2

S$100,000

2

4

S$150,000

3

6

S$200,000

4

8

S$300,000

5 and later

10

S$400,000

Business expenditure for this purpose is defined as operating expenses less the amount of any royalties, franchise fees or know-how fees to overseas recipients, any work subcontracted overseas, and the EntrePass holder’s remuneration from the company.

S pass

Persons who do not earn enough or do not have the qualifications to secure an employment pass may obtain an S pass. For work pass purposes, such employees are described as mid-level skilled workers and technicians. The criteria are a fixed monthly salary starting at S$2,200 and rising with age and work experience; educational qualifications from technical certificates corresponding to at least one year of full-time study through polytechnic diplomas to university degrees; and any relevant work experience. S pass applications are made through the same online system and likewise usually take about three weeks to be processed.

Renewals and appeals

All of the above-mentioned work passes (save the PEP, which is issued just once) may be renewed as early as six months before the pass expires. Renewal largely involves the employer updating the employee’s data (if it has not been necessary to do so already) and is generally a routine matter, unless there has been a change in policy or in the qualifying requirements for the pass.

Statutorily, any person who is aggrieved by a decision not to issue or renew a work pass (or to revoke a work pass) may appeal to the MOM, whose decision is final. There is no forum or tribunal or appeal should an application for the grant or renewal of a work pass be refused. An applicant is not entitled to know the reasons for refusal. Nonetheless, as a matter of practice, it has always been possible to appeal in writing for a review of an unfavourable decision. Also, the Work Pass Division does specify and ask for fuller or better information or documents. This is done so that it may have sufficient information to consider and approve an application, rather than reject it without any feedback.

ii Labour market regulation

Contract and tort law are relevant. The Employment Act, the Industrial Relations Act, the Trade Unions Act, the Retirement Age Act, the Central Provident Fund (CPF) Act, the Work Injury Compensation Act and the Workplace Health and Safety Act are also important sources of employment law in Singapore.

The CPF Act, for instance, makes it mandatory for employers to contribute to their employees’ national pension fund (CPF) accounts. Under the CPF scheme, Singaporean employees and permanent residents generally contribute 20 per cent of their salary to the CPF, while their employers make a 17 per cent CPF contribution over and above the salary paid to the employee. The contribution levels do vary with age. And there is a cap on contributions. Additionally, new permanent residents phase into the CPF scheme over three years, meaning that full CPF contributions at the normal levels are required in respect of a permanent resident only in his or her third year. Foreigners on work passes are excluded from this scheme. This means that, at the same wages, Singaporean employees and permanent residents are structurally more expensive to employ than work pass holders.

The Employment Act regulates conditions of service and seeks to prevent malpractice and abuses at the work place (e.g., imposing limits on overtime work, regulating entitlement to sick leave). The Act, however, does not offer protection to employees if they earn more than S$4,500 in a ‘managerial or executive position’ (which has not been clearly defined). The presumption is that such persons are better able to protect their own interests and hence do not need statutory protection.

Apart from litigation, arbitration or mediation, employees or employers can approach the MOM for free mediation or conciliation services when there is an employment dispute.

iii Rights and duties of sponsored employees
Spousal and familial applications

An employment pass holder with a fixed monthly salary of at least S$5,000 may be accompanied by his or her spouse, partner, or children under dependant’s passes or long-term visit passes. An employment pass holder with a fixed monthly salary of at least S$10,000 may be accompanied by his or her parents. The dependant’s pass and long-term visit pass eligibility matrix is as follows:

Fixed monthly salary

Relationship

Eligible for

S$10,000 and above

Parents

Long-term visit pass

S$5,000 and above

Spouse (legally married)

Dependant’s pass

Unmarried children under 21 years

Dependant’s pass

Common-law spouse

Long-term visit pass

Unmarried handicapped children over 21 years

Long-term visit pass

Unmarried stepchildren under 21 years

Long-term visit pass

An S pass holder earning a fixed monthly salary of S$5,000 or more has the same dependant’s pass privileges as an employment pass. Otherwise, S pass holders may not bring their families to live in Singapore.

Dependant privileges for an EntrePass holder are subject to different criteria; namely, employment created for locals and business expenditure:

Local employees

Business expenditure

Relationship

Eligible for

8

$300,000

Parents

Long-term visit pass

4

$150,000

Spouse (legally married)

Dependant’s pass

Unmarried children under 21 years

Dependant’s pass

Common-law spouse

Long-term visit pass

Unmarried handicapped children over 21 year

Long-term visit pass

Unmarried stepchildren under 21 years

Long-term visit pass

A dependant’s pass or a long-term visit pass is granted for the duration of the work pass. As a general rule, the practical difference between the long-term visit pass and the dependant’s pass is that the person with a dependant’s pass may obtain a letter of consent to work in Singapore whereas the long-term visit pass holder may not work; that is to say, the latter must qualify for a work pass on his or her merits to be able to work in Singapore.

There is no public guidance from the MOM on whether dependant’s passes and long-term social visit passes are available to same-sex spouses and partners. Male homosexual acts or ‘gross indecency’ between ‘any male person’ and ‘any [other] male person’ are legally criminal offences punishable with up to two years’ imprisonment, but prosecutions are rare.

Cancellation of work pass

When the work pass holder leaves his or her job, the pass must be cancelled and the card surrendered to the Work Pass Division. When the work pass is cancelled, the person will receive a 30-day short-term visit pass. A visit pass can be extended for up to 89 days. Work pass holders are also required to pay any outstanding income taxes in Singapore before they leave. There is a ‘tax clearance’ obligation on the employer to notify the Revenue of a foreign national’s impending departure at least one month in advance, and withhold any monies due to the employee pending clearance from the Revenue.

V INVESTORS, SKILLED MIGRANTS AND ENTREPRENEURS

i Permanent residence

Holders of employment passes, PEPs, EntrePasses and S passes may apply for permanent residence after working in Singapore for about two years. Generally, the higher the category of work pass held, the greater the likelihood of obtaining permanent residence. The usual processing time is between four and six months.

A person applying for permanent residence may include his or her spouse and children under 21 years in the same application. A family unit applying for permanent residence is regarded as evincing a greater degree of commitment to Singapore and generally receives more favourable consideration than an application that omits one or more members of the applicant’s immediate family.

On the other hand, parents should consider carefully whether to make their sons permanent residents of Singapore because compulsory conscription for national service applies to boys who obtain permanent residence through their parents. They have to enlist in the Singapore armed forces for two years when they reach the age of 18. This is followed by part-time ‘operationally ready’ or reservist service up to age 50 for officers or age 40 for other ranks.

A person granted permanent residence receives an entry permit to enter Singapore as a permanent resident. If he or she never leaves Singapore again, the duration of his or her status as a permanent resident is indefinite.

A permanent resident is also issued with a re-entry permit. A valid re-entry permit is required to return to Singapore as a permanent resident. In other words, a person ceases to be a permanent resident should the re-entry permit expire while he or she is abroad. In practice, therefore, permanent resident status is not truly ‘permanent’ but has to be renewed periodically.

ii Global investor programme

The GIP is a scheme offering direct entry to permanent residence. It is offered by the EDB to foreigners with ‘a substantial business track record and a successful entrepreneurial background.’ In hard numbers, this means that a person seeking a direct route to permanent residence under the GIP must have started and still be a shareholder in a business with a turnover of at least S$50 million both in the past year as well as on average over the past three years. If the business is a private and not a public company, the applicant must own at least 30 per cent of the equity.

The applicant has to offer to make an investment of S$2.5 million either in the start-up or expansion of a business in Singapore within an investment sector that Singapore is interested in promoting (e.g., aerospace engineering, chemicals, healthcare, nanotechnology), or in an approved venture capital fund investing in Singapore-based companies. The approved investment sectors and funds change from time to time. The investment is locked in for five years.

There is also a family office option for applicants with at least five years’ ‘entrepreneurial, investment or management track record’ and whose personal or direct family net worth is at least S$400 million. A high net worth individual meeting these criteria may obtain permanent residence under the GIP by investing S$2.5 million in setting up a single-family office in Singapore to manage assets of at least S$200 million.

Permanent residency for the investor’s spouse and children is available, if desired, in the one application.

VI OUTLOOK AND CONCLUSIONS

As of June 2016, the total Singapore population was 5.61 million. The number of foreigners working, studying and living in Singapore was about 2.198 million, accounting for nearly 39.2 per cent of the total population.2

The Singapore government takes a pragmatic approach towards immigration. It recognises that immigration policies must remain open because there are significant manpower shortages in the Singapore economy. Reliance on foreign manpower remains a necessary ingredient for economic growth. At the same time, it is aware that the citizenry feel that immigration policy has been too liberal and has caused immigration to get out of hand. The number of foreigners in the workforce and the level of immigration has become a politically sensitive matter. Locals are unhappy because they are afraid of being bypassed by foreigners in the job market. They are also angry at the housing shortages and infrastructure pressures that have resulted from the rapid influx of foreigners in the past decade.

The government is now seeking to correct this imbalance and maintain the foreign workforce at less than one-third of the total workforce. Recent tightening of immigration policies and future legislation should be viewed against this backdrop.

Immigration policies should also be reviewed in tandem with the government’s efforts to raise the productivity of the general workforce. If productivity is increased, there will be less reliance on foreign manpower for economic growth. Therefore, the extent of the ‘tightening’ of immigration policies will also depend on the success of the government’s efforts. The government has stated that foreign manpower should be treated as a complement to, rather than a substitute for, local manpower. Be that as it may, if the government remains unsuccessful in its efforts to boost productivity, foreign manpower will, inevitably, remain as a substitute for a long time to come.

1 Leon Kwong Wing is a partner at KhattarWong LLP. The author would also like to acknowledge the contribution of Lim Zhi Qi.

2 ‘Population In Brief 2016’, by the National Population and Talent Division, Strategy Group, Prime Minister’s Office, Singapore Department of Statistics, Ministry of Home Affairs, and Immigration and Checkpoints Authority, September 2016. www.nptd.gov.sg/Portals/0/Homepage/Highlights/population-in-brief-2016.pdf.