As has been discussed in previous Articles, these days most “Offshore” Jurisdictions have passed VASP laws – meaning if you intend to market and or manufacture a “Virtual Asset” via a Company formed in such a jurisdiction – you’ll need to apply for a Virtual Asset Service Provider (“VASP”) License. (The definition of “Virtual Asset” in most jurisdictions typically includes a digital representation of value that can be digitally traded or transferred and can be used for payment or investment purposes but does not include a digital representation of fiat currencies).
As has also been noted in previous articles, if you do intend to market and or manufacture Virtual Assets, in essence, there are only 3 “Offshore” jurisdictions where you could potentially incorporate such a business ie:
- Panama: https://offshoreincorporate.com/panama-offshore-companies/ ;or
- Samoa: https://offshoreincorporate.com/samoa-international-business-companies/ ;or
- St Vincent: https://offshoreincorporate.com/saint-vincent-and-the-grenadines-svg-companies/
First up let’s be clear – the question of where to incorporate (and how to structure) your Offshore Company is a commercial decision for you and you alone to decide… You’ll need to do your due Diligence ie you need to identify the potential jurisdictions then you need to drill down and do you’re research as regards the features/pros/cons of each jurisdiction so you can then make an informed choice about where/how to set up.
We wouldn’t recommend incorporating in St Vincent because they have passed a VASP Bill and its only a matter of time before they develop the infrastructure needed to implement a VASP License regime.
So if you want to incorporate a VASP style business tax free Offshore – without having to apply for a VASP style License – that leaves a choice, in effect, between Samoa and Panama.
On the face of it Samoa would be easier to set up – their KYC requirements are fairly straight forward (eg no references required) and the set up time is minimal (once we’ve received all your docs via email we can usually set up a Samoa Company within 2-3 days, whereas in Panama it takes 2-3 weeks). Additionally, a Samoa Company would be simpler to manage in that it has lower level Account keeping requirements (Check this Link for details: https://www.dropbox.com/scl/fi/pho952fth2hfnm2qbhrcv/SAMOA-COMPANIES-ACCOUNTING-RECORDS-REQUIREMENTS.docx?rlkey=avrp7eynz7hydtku5mav5o022&st=asnrg1pg&dl=0 )
(You can also view Panama’s Account keeping requirements at/via this Link: https://www.dropbox.com/scl/fi/moue9nhqnf68ciipsq3ix/Panama-Entities-Account-Keeping-Requirements.docx?rlkey=6vxcvzmsh7hy3uoe96pv4cjz7&st=edcbrrlg&dl=0 )
The downsides of Samoa are (a) its theoretically possible that later on down the track the Samoan Authorities could decide to pass VASP Legislation (there’s no risk of that in Panama as the govt has already tried and the law was declared unconstitutional). + (b) almost certainly when you apply for a bank account for your Company you are going to need to produce to the bank a legal opinion confirming that your Company doesn’t require a Special License in its country of incorporation. This will be hard to get in Samoa (the legal profession there is rather unsophisticated) and will be much easier to get in Panama…
In terms of the challenge of getting a bank account opened one doubts it will make much difference whether you’re incorporated in Samoa or Panama. It may be slightly easier to get an account opened for a Samoa Company as its doesn’t have much (if any) negative history as a jurisdiction (it hasn’t had a “Panama Papers” style reveal. As yet). The upside of Panama is it’s very much a first world country in terms of infrastructure – it’s a financial powerhouse (the “Big 4″ Accounting firms have offices there, there are plenty of “high level” law firms, + lots of Banks & Fund Managers etc that you don’t have in Samoa…)
Would you like to know more? Then please Contact Us:
info@offshorecompaniesinternational.com
DISCLAIMER: OCI is a Company/Trust/LLC/LP/Foundation Formation Agency. We are not tax advisers or legal advisers. You are advised to seek local legal/tax/financial advice in regards to your local reporting/tax requirements before committing to set up or use an Offshore Company or other entity.
