Singapore Corporate Service Providers Act 2024: Laying Stronger Legal Foundations

The CSP Act 2024, taking effect on 9 June 2025, marks a significant milestone in Singapore’s corporate services landscape. By strengthening the regulatory framework, the Act closes existing gaps, enhances anti-money laundering and countering the financing of terrorism and proliferation measures, and promotes greater transparency. This legislation lays a solid foundation for the entire corporate ecosystem, ensuring that Singapore remains a trusted hub for global business.

In today’s article, let’s look into the key requirements of the CSP Act 2024 with BBCIncorp. We will explain what they mean for enterprises and service providers operating under the updated Singapore corporate services regime, and how your entity will be affected.

What is the Corporate Service Provider Act in Singapore?

The Corporate Service Provider (CSP) Act 2024, along with the accompanying CSP Regulations 2025, came into force on 9 June 2025. Together, they establish a comprehensive framework that enhances the regulatory regime for corporate service providers in Singapore and raises compliance standards to meet evolving global expectations.

These measures strengthen accountability, improve transparency, and align Singapore’s corporate services sector with the Financial Action Task Force (FATF) recommendations and the United Nations Act 2001.

In particular, the CSP Act defines a corporate service provider as any business entity that offers incorporation, compliance, nominee director or shareholder arrangements, and related corporate services in and from Singapore. The new rules impose uniform requirements across the industry to foster consistent, responsible practices that safeguard the integrity of Singapore’s business ecosystem.

Broader scope of regulation and mandatory registration

A central pillar of the CSP Act 2024 is the requirement for all entities carrying on the business of providing corporate services to register with the Accounting and Corporate Regulatory Authority (ACRA) as a registered CSP. This obligation applies regardless of whether the provider submits filings to ACRA.

Operating as an unregistered CSP is a serious offence. A breach of this requirement is punishable by a fine of up to SG$50,000, imprisonment for up to two years, or both. In the case of a continuing offence, an additional fine of up to SG$2,500 per day may be imposed [CSP Act, Section 7]. This closes prior regulatory gaps and allows ACRA to take effective enforcement action against unregistered operators, enhancing oversight across the sector.

Strengthened AML/CFT/PF obligations

Under the new framework, registered CSPs must comply with stringent obligations to combat money laundering, terrorism financing, and the proliferation of weapons of mass destruction (AML/CFT/PF). These obligations include implementing internal controls, conducting client due diligence, reporting suspicious transactions, and keeping proper records.

Specifically, the Act introduces clear provisions to extend compliance requirements beyond traditional AML and counter‑terrorism financing, also to address the risk of proliferation financing. This alignment with FATF’s updated recommendations and the United Nations Act ensures that Singapore remains a trusted international financial and business centre [CSP Act, Section 17].

Any registered CSP that fails to meet its AML/CFT/PF obligations may be fined up to SG$100,000 for each breach, and senior management can also be held personally liable for failing to ensure compliance, facing the same maximum penalty [CSP Act, Sections 16, 17, 29, 30]. These penalties reflect the seriousness of non‑compliance and reinforce accountability at all levels.

Higher standards for nominee arrangements

The CSP Act introduces fit‑and‑proper standards for nominee directors and shareholders appointed by CSPs. Individuals acting as nominee directors by way of business must now be arranged only through registered CSPs.

A person acting as a nominee director outside this arrangement risks a fine of up to SG$10,000. Similarly, CSPs that fail to assess whether nominees are fit and proper may face fines of up to SG$100,000 [CSP Act, Sections 16, 38]. Providers must verify that nominees are not disqualified under any written law and consider additional criteria prescribed by subsidiary legislation.

These provisions are designed to prevent the misuse of nominee arrangements for illicit purposes, such as creating shell companies to facilitate money laundering, and reinforcing the integrity of corporate governance.

Enhanced nominee director disclosure

To strengthen transparency, the CSP Act and the Companies and Limited Liability Partnerships (Miscellaneous Amendments) Act 2024 (CLLPMA Act) mandate disclosure of nominee director and shareholder status to ACRA. This information becomes part of the public record, visible in business profile extractions.

At the same time, full beneficial ownership information remains accessible only to public agencies for enforcement purposes [CLLPMA Act, Sections 10, 13]. These measures align Singapore with FATF’s updated beneficial ownership standards introduced in March 2022 and underscore the country’s ongoing commitment to corporate transparency and international cooperation.

Stronger enforcement and higher penalties

The CSP Act introduces higher penalties for breaches of AML/CFT/PF obligations by both CSPs and their senior management, up to SG$100,000 per breach. These penalties are calibrated to reflect the high risks posed by corporate services being exploited for illicit activities and are consistent with penalties applicable to other designated non‑financial businesses and professionals in Singapore.

In addition, the CLLPMA Act raises maximum fines from SG$5,000 to SG$25,000 for offences related to maintaining accurate registers of registrable controllers, nominee directors, and nominee shareholders. This increase ensures that penalties remain sufficiently dissuasive, supporting the accuracy and reliability of corporate records in line with FATF recommendations [CLLPMA Act, Sections 14, 21].

Building confidence through compliance

Together, the CSP Act and its supporting regulations set a new standard of regulatory changes, enhanced compliance, and nominee director rules for Singapore’s corporate services sector. By introducing clear requirements, raising accountability, and improving transparency, these laws reinforce trust in Singapore as a premier jurisdiction for global business.

For any company providing or relying on corporate services, it is vital to understand these changes, adapt processes, and maintain vigilance to meet the new expectations. The CSP Act is more than just compliance. It is about building resilient bases for the jurisdiction.

How the Act supports the entire business system

The CSP Act 2024 and its supporting regulations reflect Singapore’s continued commitment to safeguarding its corporate services industry and maintaining its global reputation as a clean, trusted place to do business. These changes are not just regulatory formalities. They are essential to strengthening the entire business ecosystem, ensuring that all entities operating in and from Singapore are built on a foundation of integrity, accountability, and transparency.

Why the changes were necessary

In recent years, the Financial Action Task Force (FATF) and other international bodies have raised concerns about the risks posed by weak oversight of corporate service providers. Unchecked nominee arrangements and insufficient due diligence have been exploited to create shell companies for money laundering, terrorism financing, and tax evasion.

Without clear, consistent obligations, gaps in regulation threatened to undermine the trust that has long made Singapore attractive to investors. The regulatory changes under the CSP Act address these weaknesses decisively.

A reinforced concrete base

A helpful way to understand the value of these reforms is to imagine the corporate ecosystem as a structure built on a reinforced concrete base. Every element of the Act strengthens a critical part of that base, ensuring that the corporate environment can withstand external and internal pressures.

AML/CFT/PF: the waterproof seal

The new AML/CFT/PF obligations act as a waterproof seal against illicit financial flows. Just as a waterproofing layer keeps a building’s foundation dry and protected from erosion, strict measures protect the financial system from being misused for illegal activities. With every registered corporate service provider now required to implement policies and controls in line with FATF standards, Singapore closes avenues for abuse and reduces systemic risk.

Fit-and-proper checks: the reinforcing rods

Similarly, the fit-and-proper nominee checks function like the reinforcing steel rods embedded in concrete. These checks will make sure that only individuals who meet strict integrity and competence standards can serve as nominee directors or shareholders appointed by a CSP. Without these reinforcing rods, the foundation risks cracking under pressure. By requiring CSPs to assess and verify nominees thoroughly, the Act prevents unsuitable or disqualified individuals from undermining the system.

Records and audits: the plans and inspections

The strengthened record-keeping and audit obligations under the Act serve as the architectural plans and inspection certificates of the ecosystem. Just as clear blueprints and regular inspections facilitate the compliance of a building with safety standards, accurate registers of controllers, nominee disclosures, and ongoing updates allow regulators to monitor corporate structures effectively. These records make it easier to detect irregularities and hold individuals accountable when misconduct occurs.

A more resilient and trusted environment

Together, these elements create a foundation that supports a transparent corporate environment. Investors, businesses, and regulators alike can trust that companies operating in Singapore are structured properly and subject to appropriate oversight. This trust is essential for maintaining Singapore’s competitive edge as a leading global business hub.

By implementing the enhanced compliance measures and nominee director rules under the CSP Act, Singapore is future-proofing its corporate services industry. The result is not just compliance for its own sake but a more reliable ecosystem where businesses can thrive with confidence.

How BBCIncorp supports clients with diligence

At BBCIncorp, we understand that the CSP Act 2024 sets higher standards for service providers and their clients. Our practices help businesses meet these requirements seamlessly while maintaining trust and operational clarity.

Expert governance for providing services

BBCIncorp appoints only qualified individuals to oversee its operations and support clients with informed guidance. In addition, our network of solution partners connects clients to industry experts in Singapore, providing added value and insights from seasoned professionals.

Strengthened internal controls

We have updated all internal AML/CFT/PF policy manuals to comply with the latest obligations. Our entire team has been trained on the updated rules, equipping them to handle complex compliance matters effectively. To stay ahead of risks, we conduct quarterly internal audits and apply a detailed client risk scoring system.

Nominee screening and transparency

Our nominee director and shareholder vetting process includes comprehensive background checks and competency assessments. This fit-and-proper review confirms that every appointment meets legal and ethical requirements. The enhanced know-your-customer (KYC) procedures allow us to carry out these checks thoroughly and efficiently. We also inform clients of clear disclosures about nominee role requirements and share information with ACRA upon request.

Commitment to client protection

We have improved the client onboarding experience with clearer consent forms and transparent reporting obligations. Our client portal further streamlines the process, fostering privacy while maintaining full compliance with government requirements.

Particularly, our digital platform allows clients to securely manage their information, track obligations, and communicate with our team conveniently and confidentially.

Dedicated compliance support

Since 2019, BBCIncorp has been offering comprehensive ongoing compliance services in Singapore, including a dedicated helpline for client queries on the CSP Act and governance matters. Through our expertise, concrete internal policies, and secure technology, businesses can focus on growth while fulfilling compliance responsibilities with clarity and confidence.

To conclude

The CSP Act 2024 has transformed Singapore’s corporate services landscape by introducing a robust regulatory footing. With mandatory registration for all providers, and sharper enforcement measures, the Act strengthens trust and accountability across the entire business ecosystem.

BBCIncorp has already adapted to these changes by reinforcing our internal processes and implementing safeguards that protect our clients’ interests. As part of this, our enhanced KYC procedures may occasionally take time to complete, and we sincerely ask for your cooperation and patience as we carry out the necessary checks to meet regulatory standards.

Should you have any questions regarding the new requirements, please don’t hesitate to contact BBCIncorp team at service@bbcincorp.com. We’re committed to offering timely support.

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