|
An offshore company is a company which does not conduct substantial business in its country of incorporation. They are sometimes known as non-resident companies. The term company may refer to a separate legal entity, as in English law, or may simply refer to a business, as is the common use in the United States. ...
Incorporation (abbreviated Inc. ...
Benefits Offshore companies may bring a number of benefits to individuals or companies. - Taxation - business may be structured so that profits are realized in ways that minimize their overall tax liability.
- Simplicity - except for regulated businesses, such as banks or other financial institutions, some jurisdictions make it relatively simple to set up and maintain companies.
- Reporting - the level of information required by the registrar of companies varies from jurisdiction to jurisdiction.
- Asset protection - it is possible to organize assets and transactions in such a way that assets are shielded from future liabilities.
- Anonymity - by carrying out transactions in the name of a private company, the name of the underlying principal may be kept out of documentation. Having said that, current anti-money laundering regulations often require banks and other professionals to look through structures.
- Financial assistance - offshore companies are usually not prohibited from providing "financial assistance" for the acquisition of their own shares, which avoids the needs for "whitewash" procedure in certain financial transactions.
Whilst there is no precise definition of what amounts to an Offshore Financial Centre (or OFC), the term is usually meant to refer to low-tax, lightly regulated jurisdictions which specialise in providing the corporate and commercial infrastructure to facilitate the use of those jurisdictions for the formation of offshore...
A company said to be thinly capitalised when its capital is made up of a much greater proportion of debt than equity, ie. ...
Banker redirects here; see wiktionary:banker for more meanings. ...
Wikipedia does not yet have an article with this exact name. ...
In law, financial assistance refers to assistance given by a company for the purchase of its own shares. ...
It has been suggested that shareholder be merged into this article or section. ...
Disadvantages - Offshore companies are usually prohibited from conducting business or retaining employees in their jurisdiction of incorporation.
- For regulatory reasons, there are often certain restrictions on the type of business which an offshore company can engage in. For example, it is quite common for there to be general prohibitions against offshore companies engaging in banking business, insurance business or operating as a trust company.
- Because of the limited amount of publicly available information in connection with offshore companies, there is usually a high level of hidden costs at the administrative level. For example, to open a bank account in the name of an offshore company, to comply with relevant anti-money laundering regulations, the bank will normally require large quantities of corporate documentation to be notarised and apostilled in the jurisdiction of incorporation, and may require opinions from local lawyers in that jurisdiction as to the capacity and power of the company to open and operate a bank account.
- Certain countries have "anti-tax haven" legislation which makes it difficult to conduct business in those countries using an offshore company. For example, capital markets regulations in France prohibit using offshore companies as bond issuing vehicles.
- Where a shareholder of an offshore company dies, it is usually necessary to have the will admitted to probate in the offshore jurisdiction as well (or, if intestate, to have the letters of administration re-sealed in that jurisdiction), which can add to cost, delay and inconvenience in administering the deceased's estate.
A trust company has been referred to as a near-bank; while technically it differs from a bank in mandate and services offered, it also provides banking services such as chequing accounts, savings and loans, investments and credit cards. ...
Anti-money laundering is a term mainly used in the finance and legal industries to describe the legal controls that require financial institutions and other regulated entities to prevent or report money laundering activities. ...
Notary can refer to either of the following two professions: Notary public. ...
An apostille, or postil, is properly a gloss on a scriptural text, particularly on a gospel text, however it has come to mean an explanatory note on other writings. ...
The capacity of both natural and artificial persons determines whether they may make binding amendments to their rights, duties and obligations, such as getting married or merging, entering into contracts, making gifts, or writing a valid will. ...
A tax haven is a place where certain taxes are levied at a low rate or not at all. ...
A shareholder or stockholder is an individual or company (including a corporation), that legally owns one or more shares of stock in a joint stock company. ...
In the common law, a will or testament is a document by which a person (the testator) regulates the rights of others over his property or family after death. ...
Intestacy refers to the body of common law that determines who is entitled to the property of a dead person in the absence of a last will and testament or other binding declaration. ...
Features of offshore companies - Memorandum and articles of association or bylaws - these documents are fundamental to the existence of the company, and detail the rights of the members, the objectives of the company and the internal processes of the company.
- Certificate of Incorporation - this is issued by the Registrar of Companies, and is proof that the company has been brought into existence. Other information may be necessary to prove that the company has not been liquidated or struck off.
- Registration Agent - it is normal for an agent to be appointed in the jurisdiction in which the company is incorporated for the purpose of dealing with official communications with the registrar.
- Registered Office - this is the official address of a company, to which official documents are sent and legal notices received. It is normal for the registration agent to provide a registered office. A company may have other business and correspondence addresses.
- Members - these are the legal owners of the company. For administrative simplicity, or for anonymity, a corporate service provider may supply nominees who will hold shares on behalf of a beneficial owner, and act on his instructions.
- Directors - the individuals who manage the day-to-day affairs of company. In many jurisdictions it is possible for companies to be directors of other companies. Corporate service providers in offshore jurisdictions will often provide directors, provided they are able to control, and be satisfied with, the activities of the company. The company is generally considered to be resident for tax purposes at the place where the decisions are made.
- Shadow directors - in some cases, it has been shown that the formally appointed directors merely act as the alter ego of others, blindly following their instructions. In these cases, the courts have considered that those instructing the named directors really control of company, and that the named directors merely rubberstamp decisions. Companies managed in this way run the risk of being deemed to be resident in the jurisdiction where the shadow director is resident. Unpredictable tax consequences may follow.
- Company Secretary - this is the person who is responsible for ensuring that the company meets its statutory obligations. Corporate service providers often provide this service.
- Statutory Records - a company is obliged to maintain registers setting out certain information about the company. The mandatory records vary from jurisdiction to jurisdiction, as does the level of public access to the information contained in the records. Many jurisdictions require that the records are kept within the jurisdiction in which the company is incorporated. The records required may include minutes of meetings, registers members, directors, officers and charges.
- Bookkeeping - directors are generally required to keep proper records. They may be required to prepare audited accounts. Specific requirements vary between jurisdictions and may depend on the nature of the company's activity. For example all banks will need to prepare audited accounts, whereas a private investment company may not have such an obligation.
A Memorandum of Association is one of the documents required in the United Kingdom to incorporate a company, also seen in many jurisdictions of the British Commonwealth. ...
Articles of Association are a requirement for the establishment of a company under United Kingdom and in most other countries company law. ...
A Bylaw (sometimes also seen as By-Law or ByLaw) is a rule governing the internal management of an organization, such as a business corporation. ...
Types of company Examples of offshore companies include the Limited Liability Company (LLC) and the International Business Company (IBC). A limited liability company (denoted by L.L.C. or LLC) is a legal form of business company in the United States offering limited liability to its owners. ...
Please wikify (format) this article as suggested in the Guide to layout and the Manual of Style. ...
The following types of company are common in offshore jurisdictions:
- Company having a share capital - these companies issue shares. Once the initial cost of a share (capital and premium) has been paid, the shareholders have no further obligation to the company. The shares may, subject to the rules of the company, be sold or transferred, and the shareholders have the right to enjoy the profits of the company or any proceeds of a liquidation.
- Company limited by guarantee - the members of the company agree to pay up to a maximum limit an event that the company becomes insolvent. They may acquire certain rights against the company, such as the rights to a dividend and the specific rights will be set out in the rules of the company. Membership may terminate on death, and guarantee companies have been used for not for profit organizations. There are also sophisticated estate planning schemes which make use of guarantee companies.
- Protected cell companies - some jurisdictions permit cellular companies, where particular assets and liabilities are segregated into "cells", in such a way that the assets of one cell cannot be used to satisfy the liabilities of another. Cell companies are particularly used for umbrella mutual funds or unit linked insurance bonds.
However, many offshore jurisdictions offer increasingly specialised forms of companies (as well as specialised trusts and partnerships seeking to increase their share of the market. Examples include limited duration companies, unlimited liability companies, companies limited by guarantee and with a share capital, restricted purpose companies and hybrid entities such as limited liability partnerships, which are more akin to companies to actual partnerships, and foundations, which are nominally trusts but are more akin to companies than trusts. A segregated portfolio company (or SPC), sometimes referred to as a protected cell company, is a company which segregates the assets and liabilities of different classes (or sometimes series) of shares from each other and from the general assets of the SPC. Segregated portfolio assets comprise assets representing share capital...
An umbrella fund (sometimes called a fund of funds) is a mutual fund containing several sub-funds, each of which uses a different investment strategy. ...
Look up trust in Wiktionary, the free dictionary. ...
A partnership is a type of business entity in which partners share with each other the profits or losses of the business undertaking in which all have invested. ...
Merger The traditional method of merging companies is for one company to acquire the assets of a subsidiary on its liquidation. This sometimes creates contractual difficulties, and requires third parties to accede to the transfer of obligations from the liquidated company. Some jurisdictions have tackled this issue by permitting companies to merge, forming a new combined entity, which represents a continuation of the businesses of each former company.
Relocation of companies Some jurisdictions permit companies to redomicile. They may do this to take advantage of particular features of the new jurisdiction, such as merger legislation, or tax treaties with other countries. The law in both the old and new jurisdictions must permit redomiciliation. The business of the company is deemed to continue without interruption on redomiciliation.
Offshore jurisdictions -
It is possible to incorporate offshore companies in many jurisdictions. The following list is not exhaustive. The following are designated as offshore financial centres by the IMF or the FSF: Andorra Anguilla Antigua Aruba Aruba Bahamas Bahrain Barbados Barbados Belize Bermuda British Virgin Islands Cayman Islands Cook Islands Costa Rica Cyprus Djibouti Dominica Dublin Gibraltar Grenada Guam Guernsey Hong Kong Isle of Man Israel Japan Jersey...
Official language(s) None Capital Dover Largest city Wilmington Area Ranked 49th - Total 2,491 sq mi (6,452 km²) - Width 30 miles (48 km) - Length 100 miles (161 km) - % water 21. ...
Coordinates: Emirate Dubai - Sheikh Mohammed bin Rashid Al Maktoum Area - City 4,114 km² (1,588. ...
Motto: Coordinates: Country Malaysia State Wilayah Persekutuan Made into Federal Territory 1984, October 19th Administered by Perbadanan Labuan Labuan Corporation Chairman Datuk Suhaili Abdul Rahman Area - City 92 km² Population (2000) - City 78,000 (est) Time zone MST (UTC+8) - Summer (DST) Not observed (UTC) Website: http://www. ...
This article does not adequately cite its references or sources. ...
See also |
Feeds |
Contact