What are the minimum legal requirements for an online business in Singapore?

minimum legal requirements online business singapore

Regardless of whether you operate a “tech” startup or not, your company should always have an internet presence in some form or another. It doesn’t matter if you operate a laundromat, a restaurant or a Software as a Service (SaaS) startup. Every type of business can benefit from being online, and many of the startups gaining traction in Singapore operate entirely in the digital space.

There are a few standard matters to take care of when starting any kind of business, from getting the appropriate government licenses, appointing a company secretary, deciding on your directors and incorporating the company (if you’ve decided on setting up a private limited company as opposed to the other business structures) to applying for a trade mark and ensuring your company has been assigned the relevant intellectual property rights.

However, when you move online, there are a few minimum legal requirements you should be aware of as you develop your website, even if your website doesn’t offer any goods or services!

Privacy Policy

Almost all online businesses handle personal electronic data, even if you don’t sell anything. A simple blog that doesn’t make money but collects an email address from a user is handling electronic personal data, and in Singapore, there is a data protection regime governed by the Personal Data Protection Act. Under this Act, startups with an online presence are required to obtain the consent of an individual before they can collect use or disclose any personal information related to that person.

As such, when you start an online business, you’ll need to have an agreement called the Privacy Policy drafted to explain how personal data provided by users on your website is collected and used to avoid any issues involving a breach of Singapore’s data privacy laws.

Terms of Use

A website’s Terms of Use sets out the agreement between the website owner and the user, and ensures that the user agrees to the website’s terms when using it. The Terms of Use goes by many different names (such as Terms of Service, Terms and Conditions of Website, Terms and Conditions of Use, Website Legal Notice, etc) but their function remains the same.

Provisions that are usually included relate to matters such as resetting of passwords, disclosures, user conduct, disclaimer, warranties, indemnities, intellectual property rights, licensing policy and limitation of liability.

Many startup founders find creating a Terms of Use for their website to be a waste of time, and many get random templates off the internet. However, a well drafted Terms of Use can be much needed protection for your startup and it would be wise to either seek professional assistance in having one drafted or to really take the time to truly understand what you need to include inside.

For example, a website which allows user generated content has to keep up with defamation laws in Singapore as and when it changes. How liability will be apportioned is a grey area in the law and it’s very important for an online business to demonstrate that they are doing their best to discourage potentially defamatory content by users.

Other Legal Documents

There may be other legal documents required for an online business in Singapore but what will be required usually depends on the type of online business being set up. At the very least, your online startup should have a Privacy Policy and Terms of Use.

If you would like to have your website Terms of Use and Privacy Policy drafted by a startup lawyer in Singapore, click here.