Corporate Bank Account Opening
After Labuan incorporated, it is necessary to open settlement bank account for corporations together. Here, we will organise the main points about what is asked when opening an offshore corporate account.
The point of opening corporate account
· What kind of business is handled by this company, what kind of product is dealt with, who is purchasing products from which country to which countries?
· How is the annual turnover of this company, how often is payment from anywhere in the country, how often is the deposit amount per turn every month? Also, how often the company remit to anyone in what country every month, how much is remittance per turn?
· Who is the UBO (Ultimate Beneficial Owner) of this company? What is the structure of the directors and shareholders, and what kind of work experience do each person have?
In the course of global anti-money laundering prevention in recent years, bank account opening examination just after new incorporation has become severe.
If you cannot open bank account at the time set up a company, the time and expense you have required will be in vain.
In order for the bank side to understand your company’s business profile, you need to keep it in a state you can explain firmly.
Especially, bank side are very wary of mentioning “consulting industry” in the column of business contents. If you cannot explain the details of a specific transaction, suspected that there is a possibility that unnatural fund transfer may be carried out, there may be cases where the opening of account is not good.
In addition, preliminary concluding a provisional agreement such as “sales contract”, “business consignment contract” etc. that will be the basis of the scheduled transaction, with the business partner, and submit it to the bank side together with director’s personal resume.
* Since July 2017, Labuan offshore banks are now required to present counter party information for all deposits / withdrawals.
Attribute | Required information to present to the bank side |
In the case where the counterparty of the payment source / withdrawal destination is an individual | Nationality and passport number |
In the case where the counterparty of the payment source / withdrawal destination is a corporation | The Country of incorporation and corporate number |
Generally, in opening a corporate account, the following questions are asked from the bank side:-
Description sample of account opening form
This is a sample (in red) of the method described below as a reference example at filling in:-
◇ Entry items (sample) on bank account opening application form | |
1. Company Information | |
Registered Name (as per certificate incorporation) | ABC Inc. (LLNNNNN) |
Company Telephone No. | +6087 – NNN – NNN |
Company Fax No. | +6087 – NNN – NNN |
Company Email Address | contact @ abc.com |
2. Business Information | |
Purpose to open the Foreign Currency Current Account | Based on the Labuan company law (Act. 1990), transactions of Ringgit Malaysia denominated accounts are prohibited in principle, so we would like to open it as an account for settlement of international transactions.
In addition, since Labuan corporate account is not subject to foreign currency regulations, it is considered convenient. |
Nature of Business/Industry/Products/Services
Note: As a guide, mere statements like “trading”, “investment holding” or “consulting is not adequate explanation. |
We import Automobile parts and Agricultural work items from China and Japan, and export them mainly to Singapore and Vietnam.
Our Labuan company takes on the role of offshore trade (trilateral trade) connecting China and the ASEAN countries, and fulfills the hub function. |
Years of Experience In Business (Director) | Possess experiences 5 years in the Import & Export industry.
※ Please refer to attach CV for details. |
Annual Business Turnover (Please provide estimation amount if newly incorporated Company in USD) | Above 2 Million USD expected
Sales ratio(Vietnam 60%, Singapore 40%) |
Source of funds (from which country (ies); expected amount involved (give a range of expected inward remittances); and frequency of inward remittances per month? | ・Sales Commision 2 – 3 times, 120,000USD – 130,000USD / month・Receive bond dividend 1 – 2 times, 2,000USD – 3,000USD / month |
Payment amount involved (give a range of expected outward remittances) and frequency of payments per month? | ・Purchase expenses 2 – 3 times, 120,000USD – 130,000USD / month・Sales fare 2 – 3 times, 8,000USD – 10,000USD / month・Rent payment at business office 1 – 2 times, 1,300 – 1,500USD / month・Employee salary payment 1 – 2 times, 3,000 – 3,500USD / month・Payment for water service· utility fee 1 – 2 times, 400 – 500USD / month |
Payments to which country(ies)? | China, Japan |
Purposes of payments/outward remittances? | purchase expenses of the Goods |
Do you remit and receive funds from individual(s)? | Yes, we have a (the) plan.
However, when it comes to dealing with a private business owner, we will endeavor to conduct transactions only with those who are registered in the tax country where the taxpayers are registered and who have proper taxation procedures. No, we don’t have a (the) plan. |
Please state list of counter parties (refers to person or business entities) – Compulsory for incoming and outgoing payment to/from your account. | XXX Inc. (Vietnum)
URL: http://www.XXX.xxx YYY Inc. (Singapore) URL: http://www.YYY.yyy ZZZ Inc. (China) URL: http://www.ZZZ.zzz XYZ Inc. (Japan) URL: http://www.XYZ.xyz |
Are you acting on behalf of another person as a trustee, nominee or professional intermediary? If yes, please disclose the ultimate beneficial owner | No |
◇ Entry items (sample) on bank account opening application form | |
◇ Company Information | |
Company name | ABC Inc. (LLNNNNN) |
Country of incorporation | Federal Territory of Labuan, Malaysia |
Date of incorporation | 1 January 2017 |
Type of currency accounts to open (i.e. SGD, USD) | USD |
Mailing address for the account | contact @ abc.com |
Main country of business | USA, Japan, Singapore |
Address of physical company | Level 4, Unit 350 – 407, Office NNN, Labuan Times Square, Jalan Merdeka, Federal Territory of Labuan, 87000 Labuan, Malaysia |
Names of all directors (exactly as per passport) |
Ichiro Suzuki |
Names of all shareholders (exactly as per passport) |
Hanako Yamada |
Names of all signatories for this account (exactly as per passport) |
Ichiro Suzuki |
1st Ultimate Beneficial Owner Details | |
Name | Hanako Yamada |
Contact Number | +6087 – NNN – NNN |
Residential Address | Level 8, Unit 350 – NNN Labuan Times Square, Jalan Merdeka, Federal Territory of Labuan, 87000 Labuan, Malaysia |
1st Contact person for this account | |
Name | Ichiro Suzuki |
Passport Number | AB1234567 |
Mobile Number | +6019 – NNN – NNN |
Office Number | +6087 – NNN – NNN |
Email Address | suzuki @ abc.com |
◇ KYC Information (Know Your Customer) | |
1. Please explain about your business activities in detail | I have experience working as a consultant in the Information Technology industry for many years. Utilizing the knowledge and experience as well as networks infrastructure which were developed during the long term career. Currently I am supporting the introduction of IT and investigating scientific data etc.
Fortunately, these efforts have brought forth fruit and have been asked for consulting services from many foreign countries, for example USA or Singapore. In the future, I would like to contribute to the future of humanity by providing my knowledge and skills to improve Information technology. |
2. What is the reason for choosing to use a non-Singapore company | Expecting to develop business activities connected to Labuan and other regions, and due to tax benefit offered by Labuan FSA.
Also, I would like to make use of Singapore company as well as Labuan company. I would like to combine both, manage funds in Labuan, and set up a sales department for foreign countries in Singapore in the future. |
3. What is the reason for choosing to open the bank account in Singapore | A banking presence in the region is required and Singapore is known for having a strong and well developed banking sector.
And there are two main reasons as follows:- 1. Continuous efficiency of transfer work In Malaysia where Labuan belongs, since the settlement debit card is not issued to the corporation immediately after its establishment, it is not very easy to use. I would like to rationalize clerical work by automating the transfer procedures that occur continuously every month. 2. Geopolitical advantage The company director I, Ichiro Suzuki, obtained Labuan work Permit and is planning to move to Malaysia soon. If banking procedures are required, I can easy move to Singapore, so I think that there is a geopolitical advantage by using Singapore bank.Especially for payment to Malaysia, there is a currency conversion fee for each settlement, but even after paying the fee, I still feel that there is a great merit because it can reduce the administrative processing work. |
4. What will the Singapore bank account be used mostly for? (eg. investments or operational account) | I would like to use Singapore account mainly as a settlement account. As mentioned in 3. above, Singapore is geopolitically close to Malaysia, and the financial system as Asian hub function is considered to be very developed than Malaysia.
For above these reasons, Singapore Bank can be most efficient for my business activities. The main payment schedule is as follows. · Rent payment at business office |
5. Reason for nominee structure (if any) | N/A |
6. Background of the beneficial owners | See the descriptions in 8. |
7. What is the source of wealth of the beneficial owners | Personal Saving (Hanako Yamada) |
8. Background of the directors | Possess experiences in the IT industry, management consulting company.
※ Please refer to attach CV for details.IT |
9. Names of some of your suppliers | XXX Inc. (US)
URL: http://www.XXX.xxx |
10. Names of some of your customers | YYY Pte Ltd (Singapore)
URL: http://www.YYY.yyy ZZZ Inc. (Japan) URL: http://www.ZZZ.zzz |
11. Names of some of your counterparts/ sister company | XYZ Co., Ltd. (Labuan)
URL: http://www.XYZ.xyz XYZ Pte Ltd (Singapore) URL: http://www.XYZ.com |
12. Expected turnover per year | Above USD300,000.00 expected
Sales ratio(US 45%, Singapore 35%, Japan 20%) |
13. Source of incoming funds into the account | Business income of Singapore, US, or other countries where business partners resides |
14. Source and intended destination of outgoing funds from the account | USA, Singapore and Japan, etc. |
◇ Details of Suppliers / Customers / Clients: | |
Counterparts (Since this account will be mainly used as a settlement) | |
Initial deposit (Amount) | 50,000USD |
Source of funds | Personal Saving (Hanako Yamada) |
Source of Wealth | Employment income (Hanako Yamada) |
Average balance to be maintained in account | 30,000USD – 50,000USD / month |
Amount and frequency of expected transactions inflow: | |
Frequency | About 1, 2 times / month |
Amount | 10,000USD – 20,000USD |
Source of funds | Business Income (ABC Inc.) |
Mode of transaction | Transfer of funds (Within the same company) |
Purpose | As settlement reserve |
Amount and frequency of expected transactions outflow: | |
Frequency
頻度 |
About 5, 6 times / month |
Amount | 4,500 – 8,200USD / month |
Destination of funds | ・Rent payment at business office 700USD – 1,000USD / month・Employee salary payment 1,200 – 1,800USD / month・Payment for water service · utility fee 250 – 350USD / month・Payment to business processing agencies 350 – 550 USD / month・Payment to airline and hotel 2,000 – 4,500USD / month |
Mode of transaction | ・Rent payment ・Salary payment ・Outsourcing fee ・Travel expenses |
Purpose | As business settlement payment |
Documents necessary for opening corporate bank account
In order to open corporate account, the following documents are required, so kindly submit it together with the opening application form above.
1. Corporate Account Application Form (Questionaire)
2. Resolution of Board of Directors
3. Certificate of Incorporation
4. Memorandum & Articles of Association
5. Register of Shareholders
6. Proof of Office Address
7. Register of Partners / Directors
8. Certified True Copies of ID/Passport and proof of residential address of: All Authorised Signatories, Directors and Ultimate Beneficial Owners
9. Letter of Recommendation from our overseas branch or a reputable bank