Who are disqualified directors?

Disqualified directors are persons who cannot hold the appointment of a director in a local or foreign company.

Disqualification under Section 148 of the Singapore Companies Act (CAP. 50)
When a director is declared a bankrupt either by a Singapore court or foreign court, the director can no longer as a director or be involved in the management of any company, unless a Court Order or written permission of the Official Assignee has been obtained.

Once the bankrupt has been discharged from bankruptcy, the individual can then be reappointed as a director in his previous or new company.

Disqualification under Section 149 of the Singapore Companies Act (CAP. 50)
A director of an insolvent company may be disqualified from acting as a director and taking part in managing the company by a Court Order. The Court may issue a disqualification order against the director under the following circumstances:

i. The person was a director of an insolvent company which was liquidated. Such a person may be disqualified if he was a director at the time of liquidation or had ceased to be a director of that company within three years from the date of liquidation; and

ii. His conduct as a director of the insolvent company makes him unfit to continue to be a director or take part in the management of the company.

The director can apply to the Court for permission to act as a director during his disqualification period. After the end of his disqualification period, which is a period of 5 years, the person can be appointed as a director of his previous company, or incorporate a new company.

Disqualification under Section 154 of the Singapore Companies Act (CAP. 50)
A person who has been convicted of certain offences may be subjected to automatic disqualification or a disqualification order by the Court. Automatic disqualification will occur upon conviction for offences involving fraud or dishonesty (whether in Singapore or elsewhere) punishable with imprisonment for 3 months or more. Examples of such offences are cheating, theft and criminal breach of trust. This will attract automatic disqualification of a period of 5 years.

A Court can also make a Disqualification Order upon conviction for:

  1. offences involving the formation or management of a company or;
  2. offences related to the failure to carry out duties honestly and diligently and failure to keep proper accounts or trading when company is insolvent.

An automatic disqualification will last for a period of 5 years whereas if the Court disqualifies the director, the person will be disqualified for a period not exceeding 5 years. The director can apply to the Court for permission to act as a director during his disqualification period in cases where he is disqualified by the Court.

Disqualification under Section 155 of the Singapore Companies Act (CAP. 50)
A director will be disqualified if he is convicted of at least 3 offences related to required filings with, delivery of documents or giving of notice to, the Registrar of Companies within a period of 5 years.

Even though he will be disqualified for 5 years from the date of his last conviction in Court, he can apply to the High Court for permission to act as a director during his disqualification period. Once the disqualification period is over, the director may incorporate companies or be appointed as a director of his previous company.

Disqualification under Section 149A of the Singapore Companies Act (CAP. 50)
A person may be disqualified by the court if he was a director of a company which was wound up on the grounds that it is being used for purposes against national security or interest.

The director will be disqualified for a period of 3 years from the date the winding up order is issued against the company. He may incorporate companies or be appointed as a director of his previous company after the end of the disqualification period.

Disqualification under Section 13 or 399 of the Singapore Companies Act (CAP. 50)
A director may be disqualified if he had been convicted of 3 or more offences under the Act in relation to the failure to file the returns, accounts or other documents with the Registrar of Companies and have not had 3 or more orders of the High Court of Singapore made against the said director under section 13 or 399 of the Act in relation to such requirements.