Nominee directors and shareholders: what the law allows and who carries the risk

The law permits a director on paper, not anonymity: who answers for the company and who can see the real owner in the UK, Singapore, the EU, Thailand and Bermuda.

In detail

A nominee director is legal in the UK and Singapore. The EU does not ban the role, but from July 10, 2027 it requires the nominee's status and the person behind the nominee to be disclosed. Bermuda banned nominee directors on December 10, 2025. In Thailand, a nominee shareholder who lets a foreigner run a business in breach of the law faces up to 3 years in prison, a fine or both, and so does the foreigner.

The law accepts a name on paper, not anonymity: a nominee carries a real director's liability, whoever gives the instructions is exposed too, and the real owner stays visible to a register, a public authority or a bank.

Five jurisdictions, five different answers

A director on paper is still a director

UK law treats anyone occupying the position as a director, whatever the title (section 250, Companies Act 2006), and every director must exercise independent judgment (section 173); a private side deal with the owner does not change that. Government guidance is blunt: you can hire others, but you remain legally responsible for the company's records, accounts and performance, and can be fined, prosecuted or disqualified.

Singapore's registrar goes further: you cannot be an "inactive", "nominee" or "sleeping" director, because all directors are responsible, active or not. That does not outlaw the role, which the same page lists as optional and reportable. Penalties: fines of up to $4,000 (5,000 Singapore dollars), up to 2 years in jail and a 5-year ban.

A director who never sees the accounts cannot perform those duties, and still answers for them.

The person giving instructions is exposed too

In the UK, a person whose instructions the directors are accustomed to follow is a shadow director (section 251); professional advice does not count. Two consequences:

• if a nominee of an insolvent or dissolved company is disqualified as unfit for conduct that followed someone else's instructions, the court can ban that person for 2 to 15 years (section 8ZA, Company Directors Disqualification Act 1986);
• in an insolvent liquidation that a director knew or ought to have concluded was unavoidable, the court can order that director, shadow directors included, to contribute to the company's assets (section 214, Insolvency Act 1986).

The EU regulation lists formal and informal nominee arrangements among possible means of control that identify a beneficial owner (Article 53).

What the registers show

UK: people with significant control and identity checks

Since November 18, 2025, Companies House has held the register of people with significant control: anyone with more than 25% of the shares or votes, the right to appoint or remove most directors, or significant influence or control. A nominee does not change the test: a nominee's shares count as held by the person behind them, and holdings under an arrangement are added together even if it has no legal force. A company that suspects a nominee sends a notice: silence without a reasonable excuse or a false answer is a criminal offence that can bring a fine, prison or both. An entry can be hidden only where there is a serious risk of violence or intimidation, and public authorities still see it.

Identity checks began that day. Individual directors and controllers verify through GOV.UK One Login. Directors do so by the next confirmation statement or on appointment, other controllers in the first 14 days of their birth month, and new ones within 14 days of joining the register. Until every director is verified, the company cannot file its confirmation statement, and staying on past the deadline unverified is an offence for which the company and all directors may answer. The check confirms a real person under their own name; the control register shows who stands behind them.

Singapore: central registers since June 16, 2025

Unless exempt, a company keeps registers of nominee directors and shareholders even if it has none, and files with the registrar's central registers. A new company files on the day of incorporation. Nominee status is public and appears in the business profile; the nominator's details go only to public agencies. The maximum fine for register offences is now $20,000 (25,000 Singapore dollars).

EU: Article 66 of Regulation 2024/1624

From July 10, 2027 (Article 90), nominee shareholders and directors must keep accurate information on their nominator and the nominator's beneficial owners, and disclose it to the company along with their own status. The company reports it to the central register and separately to banks and other firms checking it.

Banks ask their own questions

EU rules already list nominee shareholders among the factors that can point to higher risk (Annex III, Directive 2015/849), and from July 10, 2027 banks must collect the names of nominee shareholders and directors, with their status, during customer checks (Article 22 of the regulation). They must also report material discrepancies to the register within 14 calendar days, naming whom they consider the owners and nominees to be (Article 24). Singapore's registrar warns that nominee status can trigger extra scrutiny from banks.

The bank looks at the beneficial owners and where the company is really run from, and decides after checking sanctions lists and the origin of the money.

Where the structure itself is illegal: Thailand and Bermuda

Section 36 of Thailand's Foreign Business Act of 1999 targets purpose, not every name on a share register: a Thai national or company holding shares so that a foreigner can operate in breach of the Act. The nominee and the foreigner who allowed it both face up to 3 years in prison, a fine of $3,000-$30,000 (100,000-1,000,000 baht) or both. The court orders the holding to end, and ignoring the order costs $300-$1,500 (10,000-50,000 baht) a day. If a company commits the offence, directors, partners and representatives who connived or failed to take reasonable steps face the same penalties (section 41).

According to official data, in fiscal 2025 letters went to directors and shareholders of 777 companies in six high-risk sectors including tourism and real estate. 401 raised no concerns. At six companies, Thai shareholders admitted that foreigners had paid for their shares, and 118 failed to comply and got a remark on their company certificate.

Since August 1, 2026, scrutiny starts at registration (registrar's Order 2/2569). If foreigners hold under 50%, or sign for a company with only Thai shareholders, the application needs a three-month bank statement showing each Thai shareholder's payment. If a foreign director gains signing power later, the directors confirm in writing that no nominee is involved and consent to the data going to law enforcement. Lawful routes include genuine Thai shareholders who invest their own money, a Foreign Business Licence or Board of Investment promotion.

Stricter still is Bermuda: since December 10, 2025, its Companies Act has barred appointing a nominee director in any circumstances. Shares can be held through a nominee, but the beneficial owner is disclosed to the Registrar: under the 2025 law, anyone holding 25% or more or controlling the company by other means.

When a local director is a legitimate need

The main lawful reason is a local director requirement. In Singapore, at least one director must be ordinarily resident (section 145, Companies Act). Until a founder holds a work pass, another resident director fills that role, genuine or nominee. Since June 9, 2025, acting as a nominee by way of business requires an appointment arranged by a registered corporate service provider, which must first assess the person as fit and proper. Breaking the first rule costs up to $7,900 (10,000 Singapore dollars); the second, up to $78,000 (100,000 Singapore dollars) for the provider. The UK requires no resident director.

A relative who signs while someone else decides is the same arrangement. Singapore treats a director who must follow another person's wishes, formally or informally, as a nominee, and the EU regulation lists family relationships among possible means of control. A borrowed signature adds personal liability for someone close to you.

How we handle these cases

You can try this on your own, since the laws and register rules are public, but it is safer with professionals, because the mistakes here are personal. Our process is clear and transparent:

1. We check the purpose, owners and country against the law and say plainly where a structure is illegal. We do not build those.
2. We choose the structure and, where the law requires a local director, bring in a registered provider.
3. We prepare the filings, take directors and owners through identity checks and build a bank file that matches the register.

The cost is available on request from a manager.

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