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If you want to go far, go together."

- Old African Proverb

Employment Act
Coverage
Employment Contract
Act Requirements
CPF
Other Hiring Notes
Our Services
Hiring Foreigners
Fair Consideration
Types of Work Passes
Work Passes Summary
Employment Pass
Introduction
Requirements
Application Timeline
Pass Collection
Renewal
Entrepass
Introduction
Requirements
Timeline
Renewals
Our Rates

Singapore Employment Act


Coverage

In Singapore, the Employment Act governs the work relationship between the employer and employee i.e. the rights and responsibilities of the employers and employees.

The diagram below gives an overall view of the Employment Act's coverage.

 
Singapore Employment Act
Covered Not Covered
(i.e. those employees other than those not covered)
- Managers & Execs1
(>$4,500 salary)
- Domestic Workers
- Seafarer
Non-Workmen Workmen2 Managers & Execs
(≤$4,500)
- S'pore Government Staff
>$2,500 Salary ≤$2,500 Salary ≤$4,500 Salary >$4,500 Salary
Additional protection
by EA

1Managerial & Executive Position:

The personnel who fall into this category are:

- Personnel who has direct authority/influence in hiring, firing, promotion, transfer, reward or discipline of other employees.
- Personnel persons whose main duties involve management and running of the business.
- Professionals (possessing tertiary education along with specialised knowledge or skills) who carry out the same or similar responsibilities as managers or executives also fall under this category.

2Workmen

A workman is an employee whose work involves manual labour. This includes a worker who falls under any of the following categories:

- Any person, skilled or unskilled, doing manual work, including any artisan or apprentice (excluding any seaman or domestic servant);
- Any person, other than clerical staff, employed in the operation or maintenance of mechanically propelled vehicles that transport passengers, for hire or commercial purposes;
- Any person employed to supervise any workman and perform manual work. (However, the time spent on manual work must be more than half of the total working time in a salary period);
- Cleaners;
- Construction workers;
- Labourers;
- Machine operators and assemblers;
- Metal and machinery workers;
- Train, bus, lorry and van drivers;
- Train and bus inspectors;and
- All workmen employed on piece rates at the employer's premises.

Employees covered by Employment Act:

The Employment Act specifies the minimum level of benefits which must be provided to the employees. It is against the law (penalties/jail term might be imposed) if businesses provide their employees with benefits below the requirements stipulated in the Employment Act.

In addition, the Employment Act provides additional protection for non-Workmen (≤ S$2,500 salary) and Workmen (≤ S$4,500 salary). The additional protection given to these group of personnel is indicated in Part IV of the Employment Act, and covers rest days, hours of work and other conditions of service.

While Managers & Executives (≤ $4,500 salary) are covered by the Employment Act, they are not given additional protection in Part IV of the Act.

Employees not covered by Employment Act:

The employment terms and conditions for these employees are based on negotiations between the employer and the employee.


Employment Contract

The Employment Contract is an agreement between an employee and employer that specifies the terms and conditions of employment. The typical terms are:

Term Example
Appointment position Sales Executive.
Duration of employment contract A period of 2 years.
Date of employment commencement The date of commencement shall be 12 July 2014.
Remuneration package Paid a monthly salary of $4,000.
Hours of work The workdays are from Monday to Friday, and the working hours are from 9am to 6pm with 1 hour lunch break.
Employee benefits Usage of the company's gym facilities.
Probation clause Probation period of 6 months, and both parties (employer and employee) could terminate the employment contract during the probation period by giving 1 week notice.
Code of conduct All employees are to adhere to the code of conduct specified in the company's employee's handbook.
Termination Either the employer and employee could terminate the contract by giving 1 month notice period, or by payment of 1 month's salary.

Employment Benefits - Requirements of the Employment Act

Legend:

Category A Managers / Executives (> $4,500 Salary)
Category B Non-Workmen (> S$2,500 Salary),

Workmen (> $4,500 Salary), and

Managers/Executives (≤ $4,500 Salary)
Category C Non-Workmen (≤ S$2,500 Salary), and

Workmen (≤ $4,500 Salary)
No requirement indicated in the Employment Act.
(Brackets) The items indicated in the (Brackets) are the industry norms.

Example:

TermsCategory B
Paid Annual Leave(14 Days)
For the group of personnel belonging to:
"Non-Workmen (> S$2,500 Salary), Workmen (> $4,500 Salary), and Managers/Executives (≤ $4,500 Salary)",

there's no requirement for minimum number of Paid Annual Leave indicated in the Employment Act.

Nonetheless, the standard practice is to provide these personnel with at least 14 paid annual leave per year.

Pay Matters
Terms Category A Category B Category C
Minimum Wage
Overtime Pay (None) Max 72 hours/month Overtime to be paid at 1.5 times basic hourly rate
Central Provident Fund (CPF) Contribution
(Singapore Citizens and PRs)
Required Required Required
13th Month Bonus (Yes) (Yes) (Yes)

Working Hours
Terms Category A Category B Category C
Max Working Hours per day (44 hours) (44 hours) 8 normal hours plus 4 overtime hours
Max Working Hours per Week (44 hours) (44 hours) 44 normal hours plus 20 overtime hours
Max Work Days per Week (5 days) (5 days) 6 days
Paid Public Holidays 11 days 11 days 11 days

Employee Performance
Terms Category A Category B Category C
Employee Training (Varies among employers) (Varies among employers) (Varies among employers)
Performance Bonus (1-3 months salary on average) (1-3 months salary on average)
Probation Period (6 months) (6 months) (3 to 6 months)
Termination Notice Period (1 to 3 months depending on position level) (1 to 3 months depending on position level) (1 month)
Retrenchment (1 month salary per year of service) (1 month salary per year of service) Salary to be paid on last working day. Retrenchment benefit required for employees with >3 years service, but the EA does not stipulate the amount of benefit.
(1 month salary per year of service)

Employee Leave
Terms Category A Category B Category C
Paid Annual Leave (14 to 21 days depending on seniority) (14 days) 1st year – 7 days, 2nd year – 8 days, 3rd year – 9 days.
Annual increase up to max 14 days. (14 days)
Paid Maternity Leave (if eligible) 16 weeks - First 2 confinements - employer payable for 8 weeks 16 weeks - First 2 confinements - employer payable for 8 weeks 16 weeks - First 2 confinements - employer payable for 8 weeks
Paid Annual Childcare Leave (until child turns 7 years old) (if eligible) 6 days - employer payable for first 3 days 6 days - employer payable for first 3 days 6 days - employer payable for first 3 days
Unpaid Infantcare Leave (until infant turns 2 years old) (if eligible) 6 days 6 days 6 days

Employee Medical
Terms Category A Category B Category C
Paid Sick Leave (14 days sick leave and 60 days hospitalisation leave per year) (14 days sick leave and 60 days hospitalisation leave per year) Sick Leave: 5-14 days, Hospitalisation: 15-60 days.
Actual days vary with employment period
Medical Insurance (Varies among employers) (Varies among employers) (Varies among employers)

Central Provident Fund (CPF) Contributions

Applicability CPF Contributions are applicable to employees who are Singapore Citizens or Singapore Permanent Residents. CPF conributions are payable by both the employer and employee to the CPF Board (A Singapore statutory board) i.e. the total CPF to be paid to the CPF board is the summation of the portion paid by both the employee and employer.
Purpose of CPF The CPF scheme is essentially an old age savings plan for the employees - part of the employee's salary is set aside and held with the CPF Board, and the monies can be withdrawn when the employees reach the statutory retirement age.
CPF Contribution Amount The amount of CPF contributions is dependent on the age as well as the salary of the employee.
CPF Contribution Cap The amount of CPF contributions is capped at a monthly salary of S$5,000 and annual salary of S$85,000. This means that if an employee earns S$10,000, the amount of CPF contribution would be same as another who earns S$5,000.

There could be instances where the employee's compensation other than monthly salary (such as bonuses, staff benefits, etc.). The amount to be subjected to CPF for these items is dependant on the entire compensation package for the entire year. There would be no necessity to contribute further amounts to CPF for amounts above the annual compensation of S$85,000.
CPF Contribution for Singapore Permanent Residents For Singapore Permanent Residents, the CPF amount payable to the CPF board is further dependent on the factors of (1) Year of Singapore Permanent Resident status, (2) Wages, and (3) Age group.
Date of CPF Payment Date of CPF payment: there are guidelines within the CPF Act which stipulates the due date for payment of CPF. In general, the CPF contributions are due at the end of each month but employers have a grace period of 14 days to pay CPF contributions after the end of the month.
Illustration Using a simple example where the employee is a Singaporean, 30years of age and earning a salary of S$5,000. In this case the employee CPF contribution would be 20%, while the employer's potion of CPF contribution would be 16%.

The contributions paid to the CPF board would be the summation of employee's portion (S$5,000 x 20% = S$1,000) and employer's portion ($5,000 x 16% = S$800) i.e. $1,800. The employee would receive a net salary (cash in hand) of S$4,000.


Employee Salary - $5,000 (100%)
80% 20% 16%
Employee take home pay Employee contribution to CPF Employer contribution to CPF
$5,000 x 80% = $4,000 $5,000 x 20% = $1,000 $5,000 x 16% = $800
$1,800 ($1,000 + $800)
Total: $5,800
($4,000 + $1,800)

Reporting Employee Earnings

The Income Tax obliges the employer to prepare income tax forms (specifying the remuneration) for its employees (employed in Singapore) every year.

Paying levies

When an employer employs low-skilled and unskilled foreign employees, the employer has to pay an amount of "Foreign Worker Levy" to the Government.

The levy is payable on a monthly basis, and it varies in accordance to the type of worker.

Hiring students

Students who are Singapore Citizens/Singapore Permanent Residents: There are no restrictions to the hiring of these students, whether it's on a full time or part time basis. Students are entitled to CPF contributions, unless exempted.

For students who are foreigners: They would have to first apply for Work Pass Exemption with the Ministry of Manpower. Once the Work Pass Exemption is obtained, they are allowed to work. However there are certain restrictions to their employment which is tied to the institution where they are studying in.

Internship/Industrial Attachment Programmes: There are no conditions for hiring of Singapore Citizens and Singapore Permanent Residents as interns or to undergo industrial attachment. For foreign students however, there is a need to apply for a Training Employment Pass or Training Work Permit.

Hiring part time employees

Part-time employees are defined by the Employment Act as personnel who work for less than 35 hours a week.

They are treated almost the same as a fulltime employee in most instances, for e.g. there is also a need for CPF contributions for Singapore Citizens and Permanent Residents.

However, they are covered by the Employment of Part-Time Employees Regulations, which provide certain flexibility for both the employers and employees, including the pro-rating of employment benefits, encashment of annual leave and provision of rest day.

Age restrictions

There are guidelines in the Employment Act which governs the age when a person is allowed to work legally.

< 13 years of age The personnel is not allowed to work.
Between 13 and 17 years of age There are restrictions on the type of work which the personnel can perform.
Above 17 years of age No restrictions on employability.
Retirement Age As of the time of this writing, it's 62 years.

Our Services

• Computation of Employee statutory deductions and benefits.

• Payment arrangements to employees and Singapore Authorities.

• Employee expense reimbursements.

• Determination of final payment upon termination of an employee.

• Preparation of year-end tax forms for employees.

Hiring Foreign Employees


Fair Consideration Framework

Before diving into details on the work passes available for foreign employees, a key consideration which all businesses need to take into account before hiring foreign employees relates to the "Fair Consideration Framework" which is put into effect by the Singapore Government since 1 Aug 2014.

In a nutshell, the intention of the framework is to ensure that all employers doing business in Singapore give adequate consideration to Singaporeans for job vacancies.

The manner in which this is achieved is through the requirement for firms submitting Employment Pass (EP) applications (including for EP holders who are changing employers) to advertise their job vacancies on the National Jobs Bank. The job advertisement must be open to Singaporeans, comply with the Tripartite Guidelines on Fair Employment Practices, and run for or at least 14 calendar days.

While firms that submit EP applications prior to the close of the 14 day advertising period would not be able to proceed with their EP applications, firms that had complied with the advertising and window period requirement would be allowed to hire the most qualified candidate, regardless of nationality.

Nonetheless, there are certain categories of jobs which are granted exemption from the advertising requirement:

- Jobs in firms with 25 or fewer employees
- Jobs that pay a fixed monthly salary of S$12,000 and above
- Jobs to be filled by intra-corporate transferees (ICTs) - These are personnel holding senior positions in the organisation or have an advanced level of expertise
- Jobs that are necessary for short-term contingencies (i.e. period of employment in Singapore for not more than one month)

The Ministry of Manpower strongly encourages all firms to advertise their job vacancies, even if those jobs meet the requirement for exemption. Regardless of whether the job vacancies are exempted from the advertising requirement, firms found to have nationality-based or other discriminatory HR practices will face additional scrutiny from Ministry of Manpower and could have their work pass privileges curtailed.

Types of Work Passes

Under the Employment Act, a foreigner must have a valid work visa to be able to work in Singapore.

If an employer wants to hire a foreigner, the employer would have to apply for a valid work pass or work permit on his/her behalf before commencement of employment.

- Employment Pass: Skilled professionals (e.g. software engineers, doctors, R&D specialists etc.)
- S Pass: Semi-skilled professionals (e.g. technicians, chefs, administrative professionals)
- Work Permit: Unskilled Professionals (e.g. construction workers, domestic helper)

Summary of the various work passes

Employment Pass S Pass Work Permit
Suitability Skilled employees with tertiary level education and relevant work experience. Monthly salary > $3,300 Mid-skilled employees with diploma level education and relevant work experience. Monthly salary > $2,200 Unskilled workers with relevant work experience. Monthly salary ≤ $2,500
Validity Issued for 1-2 years initially. Renewable Issued for 1-2 years initially. Renewable Issued for 1-2 years initially. Renewable
Quota System No Yes
(15% of workforce in the Services sector and 20% in the remaining sectors)
Yes (Varies across industries)
Eligibility for Dependants Pass Yes Yes No
Restrictions on Nationality No No Yes
Levies No Foreign Worker Levy Foreign Worker Levy

Employment Pass


Introduction

This section drills deeper into the mechanics of Employment Pass.

Overview: An Employment Pass (EP) is a type of work visa issued to skilled foreigners to live and work in Singapore; There is no quota system limiting the number of Employment Passes that a company can apply.

The EP is issued for 1-2 years initially and renewable thereafter.
Eligibility Requirement: Aside from the minimum salary threshold of S$3,300 a month, the applicant needs to have a tertiary degree from a reputable institution and relevant professional experience. The applicant's education and experience must also be related to the proposed employment in Singapore.

The minimum salary requirement of S$3,300 is typically applicable to fresh graduates from reputable educational institutions; experienced applicants would need to command higher salaries in order to qualify.
Family Members of the Employment Pass Applicants:
Type of Family Member Minimum Required Salary of EP Applicant Types of Pass for the Family Members
For immediate family members (spouse and unmarried children under 21 years of age): $4,000 Dependant's Pass
For other family members (such as common-law spouse, unmarried handicapped children above 21 years old, and unmarried step-children under 21 years old): $4,000 (Long-Term Visit Pass)
Parents of EP Applicant $8,000 (Long-Term Visit Pass)

The application for family members' passes could be made after the EP has been approved. The family members' passes expire at the same time as the EP applicant's pass.

Documents Required for Employment Pass application

- EP Application Form (endorsed by the Singapore employing company).

- Applicant's Resume.

- Copies of educational certificates, past employment testimonials.

- A passport-size photograph taken within the past three months.

- A copy of the personal particulars page of the applicant's passport.

- Copy of the Singapore company's business profile.

- Detailed writeup of the applicant's work.

- Detailed writeup of the business (services, products, etc.) of the company.

- Additional supporting documents as required.

Any non-English documents must be translated into English.

Employment Pass Application Procedure and Timeline

Completed applications along with the required documents must be submitted to Singapore's Ministry of Manpower (MOM).

The typical processing time for an online application takes about a week, while it takes between about a month for manual submission (Manual submission allows the applicant to attach additional supporting documents).

Approval and Collection of Employment Pass

When your Employment Pass visa application is approved, MOM will send the In-Principle-Approval (IPA) letter to the employer's company address. The letter has a 6-month validity - the applicant needs to physically collect the EP in Singapore within this validity period.

When collecting the EP, MOM requires a copy of the IPA letter, passport, medical exam report, and any other documents that may be requested in the IPA letter. You may also be required to go through medical tests.

If you had applied for Dependant's Passes and/or Long-Term Visit Passes for your family, you can collect these at the same time when collecting your EP.

Do note that each EP application is subjected to the discretion and approval by the Singapore authorities. There is no guarantee that every EP application would be successful. Therefore the EP applicant should not make any relocation plans until the In-Principle-Approval is obtained.

Appeals for Employment Pass Rejections

If the initial application is rejected, we will explore the reasons with MOM and submit an appeal (where appropriate) to address their concerns. The typical processing timeframe of an appeal is between 4-6 weeks. If the appeal is successful, the EP application would be approved.

Employment Pass Renewal Procedure

About three months before the expiry of the EP, an Employment Pass Renewal Form would be sent to the employer's company address. The renewal application should be completed and submitted to MOM at least four weeks before the pass expires. If the renewal application is approved, the employer would receive an approval letter and the EP applicant could collect a new Employment Pass.

Singapore Entrepreneur Pass (EntrePass) Scheme


Introduction

The EntrePass scheme is suitable for foreign entrepreneurs who wish to start a business and relocate to Singapore.

It is advisable to apply for the EntrePass first before incorporating the Singapore company. In this way, you would not incur incorporation expenses until the outcome of the EntrePass application is known.

Once the EntrePass is approved, you have 30 days to incorporate the proposed company and inject the share capital.

The EntrePass allows you to bring your family (spouse and unmarried children under 21) to Singapore by applying for their Dependant's Passes. EntrePass holders are also eligible to apply for Singapore permanent residence in due course.

EntrePass Eligibility Requirements

Category Requirement
Applicant's Background Foreigner above the age of 21.
Have an entrepreneurial and/or relevant background.
Establish a business in Singapore and relocate to Singapore to run it. The proposed business idea must be entrepreneurial and innovative in nature, and able to create local employment.
Sponsored by a well-established Singapore-registered company or are able to furnish a Banker's Guarantee of $3,000 issued by a Singapore-based bank upon approval of application.
Business Vehicle The business can only be registered as a Singapore private limited company.
The company has yet to be incorporated, or the company is not more than six months old at the time of EntrePass application.
The applicant have at least 30% shareholding in the proposed business.
The company will have a minimum paid-up capital of S$50,000.
Innovativeness Criteria In addition to the above, you must also fulfill at least one of the new "innovativeness" conditions:
- The company is receiving monetary funding or investment of at least S$100,000 from a third-party Venture Capitalist (VC) or angel investor accredited by a Singapore Government agency.
- The company holds an Intellectual Property (IP) that is registered with a recognised national IP institution.
- The company has on-going research collaboration with an institution recognised by Agency for Science, Technology and Research (A*STAR) or Institutes of Higher Learning in Singapore.
- The company is an incubatee at a Singapore Government-supported incubator.

Documents Needed for EntrePass:

- Completed EntrePass application form
- Documentary evidence to prove that you fulfill one of the "innovativeness" requirements
- A business plan in the prescribed format
- A copy of your company's bank statement showing funds of at least S$ 50,000, if the company is incorporated prior to the submission of application
- A copy of your company's latest business profile printout, if incorporated already
- A passport-sized photograph taken within the past three months
- A copy of the personal particulars page of your passport
- Documentary evidence of your previous employment(s) and/or business venture(s), if any
- Copies of your educational certificates, if any
- Other documents that can be useful to solidify your application include licensing agreements, MOUs with potential customers/suppliers, product certifications, endorsements, etc.

All documents submitted must be in English or translated into English by a certified translation body. Your EntrePass business visa application must be sponsored by a Singapore-registered company or you will be required to provide a banker's guarantee of S$3,000 upon approval of the pass.

Business Plan for EntrePass

Along with your EntrePass application form, you will need to furnish a business plan of about 10 pages in a prescribed format as below:

Business Idea A summary covering the proposed business concept.
Product/Service: Details of product(s) and service(s) offered.
Market Analysis: Analysis of the industry potential in Singapore, target customers, key competitors, and potential for growth.
Marketing Plan: Describe how the product(s)/service(s) will be marketed or distributed.
Operational Plan: Describe how the internal operations and resources would be organised to produce the product(s) or service(s).
Management Team: Provide details of the key management individuals involved in running the business.
Financial Projections: Projected sales and net profit before tax for three years and the estimated break even point.

Disallowed businesses

The following businesses are disallowed for EntrePass application:

- Coffee shops, hawker centres, food courts
- Bars, night clubs, karaoke lounges
- Foot reflexology, massage parlours
- Traditional Chinese medicine (TCM), acupuncture, herbal dispensary
- Employment agencies, geomancy

EntrePass Application Procedure and Timeline

Entrepass Application Form (together with supporting documents)
Submission to Ministry of Manpower (MOM)
6 to 8 weeks
Review by MOM and SPRING (Standards, Productivity and Innovation Board Singapore)
Successful (A) Not Successful
Receive Approval In-Principle (AIP) Letter File Appeal Within 90 days
Within 30 days: incorporate the company & inject the necessary share capital into a Singapore bank account Review of Appeal 4 to 6 weeks
Within 30 days
Submit ACRA business profile & Bank Statement to MOM Successful (A) Not Successful
MOM issues the In-Principal Approval Letter
Applicant to perform the test (e.g. medical test) indicated in the In-Principal Approval Letter
Collect your EntrePass!
Relocate to Singapore within 6 months of the approval date
Within 6 months
Within 6 months of receiving the EntrePass, submit to MOM the latest ACRA business profile, tenancy contract and employee's CPF statement - to show proof of on-going business operations

The following is a walkthrough of the key procedures involved in the application for EntrePass:

Step Details
Submission of EntrePass Application Your EntrePass application, along with the supporting documents, are submitted to Singapore Ministry of Manpower (MOM).
The application would then be reviewed by two government bodies, namely SPRING (Standards, Productivity and Innovation Board Singapore) Singapore and MOM.
This review process takes about 6-8 weeks on average.
If application is successful: An Approval In-Principle (AIP) letter would be issued.
Incorporate the Company within 30 days You would need to then register the Singapore Private Limited Company.
Open a corporate bank account and inject the necessary share capital.
Submit to MOM (1) proof of company registration (ACRA business profile) and (2) bank statement of corporate bank account.
On approval, MOM would issue you an In-Principal Approval (IPA) letter.
Collection of EntrePass (and Dependant Passes, if any) You have to undergo the medical test indicated in the IPA approval letter. These medical tests can be done in your own country through an established clinic/hospital or you can get it done when you arrive in Singapore.
You are required to produce the medical report when collecting your EntrePass. (A one-time entry visa would be issued to you to collect the EntrePass approval letter if your nationality requires a visa).
You can collect the Dependant Passes (if you had applied for your family) at the same time when collecting your EntrePass.
Relocate to Singapore to manage the business You must relocate to Singapore within 6 months from the date of the final IPA approval letter to manage the business.
Submit proof of on-going business operations in accordance to business plans: Within 6 months from receipt of EntrePass, the applicant has to submit (1) the latest ACRA business profile, (2) tenancy contract (as proof of operative address), and (3) employee's CPF statement.

Rejection Of EntrePass Application

An appeal for rejected EntrePass applications must be filed within 90 days. The processing of an appeal takes another 4-6 weeks.

Renewal of EntrePass

The EntrePass is initially issued for one or two years. A renewal form would be sent to you by MOM about 3 months before its expiry, and you would usually be required to file the following documents:

- Latest copy of business profile from ACRA.
- Latest audited accounts.
- Highest educational certificates of local employees.
- CPF statements for the employees.
- Office Tenancy Agreement.
- Other documentary evidence on the company's activities such as invoices issued, and/or contracts awarded.

The business venture has to be conducted based on the original business plans, in order to qualify for renewal.

Tabular Summary of EntrePass Renewals

EntrePass Type Renewal Criteria Years Granted
P1 Employ > 8 local employees;
Demonstrate Total Business Spending of S$300,000 over past 12 months.
2 years (Net Asset Value positive)
1 year (Net Asset Value negative)
P2 Employ > 4 local employees;
Demonstrate Total Business Spending of S$150,000 over past 12 months.
2 years (Net Asset Value positive)
1 year (Net Asset Value negative)
Q1 Employ > 2 local employees;
Demonstrate Total Business Spending of S$100,000 over past 12 months.
First renewal: Approved for one year
Second renewal onwards: the company must be in the "P" tier.)

No. of years after receipt of EntrePass NO. of local employment created Minimum Total Business Spending EntrePass Type
1 2 S$100,000 Q1
2 4 S$150,000 P2
3 6 S$200,000 P2
4 8 S$300,000 P1
≥5 10 S$400,000 P1

Our Rates


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