How To Obtain a Belize International Money Lender’s License

As a result of the GFC and resulting consumer lending fallout, US Legislators decided to clamp down on 2nd tier lenders (and, in particular lenders of last resort such as pay day lenders).

 

When this happened the progressive International Offshore Financial Centre of Belize saw a business opportunity. The idea morphed into a plan which became Legislation. In short the Belize Offshore Industry Regulators had the foresight to realize that such a business model was never going to go away, that in particular US based business owners would be looking for a new domicile, that IBCs were likely to be used for such purposes and better they offer a Licensing regime to bring such businesses out into the open and thus attract the more serious players.

 

The legislation ie the INTERNATIONAL MONEY LENDING (SHORT TERM & UNSECURED SMALL LOANS) REGULATIONS, 2008 (a copy of which can be downloaded from this site: https://www.ifsc.gov.bz/legislation/ ) provides that:

  • A regulated entity may make loans of not more than $5,000 per loan
  • The loan cannot be secured against real estate, motor vehicles or “other tangible personal property”
  • The loan must have an initial repayment period of not more than 1 year
  • Such loans must be for household purposes and personal expenses only
  • Loans can only be made to “consumers”

 

There are also provisions regarding pre-contractual disclosures. In particular in the Lenders website (or in the loan contract) it must be stated:

 

  • That the loan is designed as a short term cash flow solution & not as a solution for long term financial needs
  • Additional fees may accrue if the loan is refinanced

 

Other features include:

 

(i)             A provision specifically providing that Belize law shall govern the loan regardless of where the Borrower is located

(ii)           The identity of the borrower must be proven

(iii)          The lender must satisfy the Regulator that at least 2 of its Management Level staff/team members have short term personal lending industry experience

(iv)          The Lender must keep in Belize books & records relating to the loans (in hard or soft form)

(v)            Not less than 70% of duties & activities relating to the Lenders business must be seen to be carried out from inside Belize (though these can be outsourced)

 

A Belize international money lending license requires you to form a Belize Company with paid up capital of not less than $US75,000. This amount can be increased by the BeIize FSC depending on your style of business model and your commercial/career background.

 

PROCEDURES TO FOLLOW WHEN APPLYING FOR A LICENSE FROM THE IFSC BELIZE:-

 

Company name:

 

We will check if the desired name is available and reserve the name. The IBC Registry allows us to reserve the name for 10 days free of charge. Thereafter, we can reserve the name for 90 additional days at a cost of $30. (NOTE – it may take up to one week for the IFSC to give an answer).

 

Company Incorporation:

 

(i)              Authorized Share Capital.

The authorized share capital depends on the what type of license is desired. For this type of Company the authorized share capital must be not less than $75,000.

 

(ii)            IBC Registry fees

The incorporation fee and annual renewal fee charged by the IBC registry (which is separate from IFSC fees) for a company with $US75k authorised capital is $1,000. The annual renewal payable to the IBC Registry is due January 1 every year, but we usually pay during the month of December before the due date.

 

(iii)          Bearer shares strictly prohibited

All shares must be registered shares. Bearer shares are not permitted. The Memorandum and Articles of Association of the company must state that bearer shares are strictly prohibited.

 

(iv)          Shareholders and directors

A shareholder may be a corporate entity, such as a company from another jurisdiction. However, that company must have physical persons as shareholders and directors. Any additional corporate layers are not allowed.

 

The company is required to have at least one director. (Trading in Securities and Foreign Exchange Services applicants are required to have two directors, one of which must be a resident of Belize.)

 

Bank Account

 

It is a requirement that every license holder keep a capital deposit in a bank in Belize as prescribed by the regulations. For example, a company that holds an International Money Lenders License is required to keep an unencumbered capital deposit of $75,000 in a bank in Belize.

 

After the bank receives the application form and other required documents, it takes two weeks for the bank to give its initial review. After we’ve addressed any issues raised in the review, it typically takes another two weeks for the account to be approved or declined.

 

Customer Due Diligence (CDD) requirement (for each beneficial owner/shareholder, director, officer and signatory):

 

  • Photo Identification -  Notarized color copy of passport. Only the pages that show identification information, photograph and signature are required.
  • References – An original reference letter is required as regards the beneficial owners/shareholders, directors, and signatories to the account. The reference letter should be from a bank (preferred), a practicing attorney or a licensed accountant. References should be recent (not older than three months), prepared with official letterhead, and should indicate the following:

(a) a period of relationship for at least (2) years;

(b)  type of relationship conducted;

(c) status of relationship;

(d)  clear contact details of the person who signs the letter.

(e)  Confirmation of Address – A utility bill issued within the past three months with complete residential address. A P.O. Box address is not accepted.

 

Note, where documents are issued in any language other than English, they must be translated to English by a certified translator.

 

IFSC application

 

The application package must contain the following:

 

  • The application form properly completed and certified, along with the non-refundable application fee of $1,000.  The application form must be signed by a director or a shareholder/beneficial owner and the signature must be notarized.
  • Certified biographical affidavit of beneficial owner, director/s, and signatories to the bank account. Also required is the certified biographical affidavit of the management of the company. In the case of corporate entities, the beneficial owners, directors and beneficial owners of that entity must also submit certified biographical affidavits.
  • Know Your Client (KYC) documentation including:

i.     Proof of ID (Notarized passport – same as bank CDD requirement)

ii.     Proof of address (notarized recent utility bill)

iii.     Curriculum Vitae – showing education and work experience

iv.     Professional reference – from a lawyer or certified accountant (similar to the reference required for the bank account application)

v.     Bank reference and bank statement (the bank reference must be from a bank where the individual has done business for more than two years.)

vi.     World Check report – (we will provide this report)

 

  • Business Plan – Detailed business plan including a three-year financial projection, together with diagram illustrating the company’s corporate structure.
  • Detailed Anti-money laundering compliance, Complaints and Internal Control policies and procedures.
  • Corporate documents (same as those mentioned in section 2.  Company Structure above). As registered agent, we provide a notarized set of copies which we then submit along with the application to IFSC.
  • Proposed website name that will be used once the licence is approved.
  • Name of external auditor who will prepare the audited financial statements on an annual basis.
  • Certificate of Qualification of Directors and Management – At least one person must possess the expertise relevant to the type of licence being sought.
  • Letter from either the Director, Shareholder or Beneficial owner of the applicant company indicating awareness of the following:
  1. That a licensee should not offer services to residents of a country whose laws require such a licence prior to engagement of such services.
  2. The Standard Conditions attached to the type of licence.
  3. That the Memorandum and Articles of Association of the company will not be amended to provide for the issuance of bearer shares.

 

IFSC Evaluation process

 

In processing applications, the IFSC will conduct its own due diligence of shareholders/beneficial owners, directors and management and will evaluate and assess the following:

 

  • The fitness and probity of each shareholder, director and management
  • The viability of the business plan
  • The AML/CFT Compliance Policy and Procedures to ensure compliance with the respective law and regulation
  • The Complaints and Internal Policies and Procedures to ensure that they are detailed and address all pertinent areas.

 

It may take up to three months for the IFSC to review the application. At this point, the IFSC may need further clarification of information or request additional information. Once all the information is submitted, the application will be evaluated and it will be determined whether the licence is approved or denied.

 

Approval of the application

 

Once the application is approved, a letter will be sent to the Registered Agent requesting payment of the licensing fees and requesting that the company provide the bank confirmation letter. Upon evidence to this effect, the license certificate will be prepared and issued.

 

Would you like to know more? Then please Contact Us:

 

www.offshoreincorporate.com

 

info@offshorecompaniesinternational.com

 

ocil@protonmail.com

 

oci@tutanota.com

 

oci@safe-mail.net

 

ociceo@hushmail.com

 

HOW DO I CHANGE THE NAME OF MY FOUNDATION?

 

We are often asked How Can I Change The Name Of My Foundation?

 

To change the Name of a Foundation, in the first instance, we will need from you (if you have not provided this already) written instructions via email to change name confirming the existing name in FULL and intended future name (it’s wise to submit two preferred names in case the first choice is not available).

 

  • Once in receipt of an email copy of the above authority (together with our fee, see below) within 24 hours we will:

(a)   seek name approval from the registry and advise you of name approval/refusal: &

(b)   draft and send to you (and then collect from you via email and airmail please, duly signed) a Change of Name minute/resolution

 

  • Once we have received by email a signed copy of the resolution, within 48 hours we will draft & submit to the registry an amended Charter & a Board Meeting resolution extract (signed by us, containing all the relevant points of the above resolution but with the Foundation Councillor’s names not mentioned, to preserve privacy). If no reply is received from the Registry within 48 hours we will follow them up with a phone call

 

  • Once the communication/certificate is received from the registry confirming that that  the PIF’s name has been changed (this should be received within 48 hours of our submitting to the registry the amended Charter & a meeting resolution Extract), we will email you, within 24 hours, to advise that the name has been changed

 

  • Once the Change of Name Certificate has been received within 24 hours we will email you a copy and will dispatch original by airmail or courier as advised by you

 

Cost of attending to Change of Name as set out above is $399 inclusive of government charges and courier if required. As per Company policy payment is required in advance and may be made by bank transfer or credit card, or via paypal account (see ac details attached; if you’d prefer to pay by car or via paypal account please advise and we will send you the necessary).

 

Would you like to know more? Then please Contact Us:

 

www.offshoreincorporate.com

 

info@offshorecompaniesinternational.com

 

ocil@protonmail.com

 

oci@tutanota.com

 

oci@safe-mail.net

 

ociceo@hushmail.com

How To Form an Offshore Company Using a Foundation

 

We are often asked what the process would be, practically speaking, for a Foundation to form/own a new Company. How it normally works is:

 

Let’s assume you have already set up a Foundation.

 

You (ie our client, ie the person who set up the Offshore Entity) are, or should already be, appointed by way of Consultancy Agreement as the Foundation’s Authorised Representative or Investment Adviser.

 

  • You would advise the Foundation Council of the need to form, or desirability of forming, a new Company and would suggest a Company name/s
  • The Foundation Council would call a meeting and pass/sign a resolution (a) authorizing the new Company to be formed and (b) appointing OCI/Your International Corporate Service Provider as the agent to form the new Company.
  • You would submit a Company order form signed by you as authorized representative of the Foundation
  • We will issue an invoice for/re the Company formation
  • Once the invoice is paid the formation will proceed forthwith

 

Foundations are widely used as part of an Offshore Corporate Structuring Plan, ie to own/hold the shares of a tax-free Offshore Company.

 

Setting up a Foundation to own your Offshore Company can be beneficial in two ways:

 

(a)   It can potentially enable you to avoid Controlled Foreign Corporation Laws – meaning you shouldn’t have to declare/pay tax at home on your Offshore Company’s income (you should only have to pay tax if/when the Company or Foundation actually pays you “income”).

(b)   Having a Foundation holding the shares of your Company makes you no longer the “beneficial owner’ of the Company. This is the ideal position to be in (i) when opening a bank account for your Company (ie so your name doesn’t appear in the bank’s records as the “beneficial owner” of the Company) or (ii) if you are ever facing a laws suit or governmental investigation/prosecution (in that case you can swear under/on oath “I am not the beneficial owner of the Offshore Company under investigation”).

 

Would you like to know more? Then please Contact Us:

 

www.offshoreincorporate.com

 

info@offshorecompaniesinternational.com

 

ocil@protonmail.com

 

oci@tutanota.com

 

oci@safe-mail.net

 

ociceo@hushmail.com

 

 

Cryptocurrency Exchanges – Do I Need/Want a License?

There are 2 questions that are often posed to us by Crypto Exchange Entrepreneurs:

 

  1. Do I need to apply for a License for my proposed Offshore Crypto Currency Exchange?
  2. Should I go down the road of applying for a Special License for my proposed Offshore Cryptocurrency Exchange?

 

The answer to the first question is it depends on where you want to incorporate!

 

Certain “Offshore” (ie nil/low tax and or low regulation) jurisdictions (most notably Malta and Estonia) have passed laws making a Cryptocurrency Exchange a Licensable Activity.

 

Obviously if you want to incorporate your Operating Company in, or place your headquarters in, one of these countries you will have to apply for a Special License or else you run the risk of being prosecuted by the local Industry Regulator (which could, if you’re convicted, result in a large fine or potentially jail time or both).

 

Non-Licensing Road

 

If you’re not willing or able to go down the Licensing road (and or if tax minimisation/ownership privacy is important to you) you might want to incorporate your Company in a Low Regulation Privacy Haven ie somewhere where buying and selling Cryptocurrency is not a prohibited (or licenseable) activity and which does NOT have a public register of directors, shareholders or owners. Most people in that position choose to incorporate in either:

 

 

You may be interested to know that arguably the world’s biggest Crypto Exchange ie Bitmex is incorporated in Seychelles.

 

Pros and Cons

 

Probably, like most OCI clients (we set up at least 1 new Crypto Exchange Offshore every week) you are wondering should I set up/apply for a License (eg Estonia, Malta etc) or should I take the easier road and just incorporate somewhere where such an activity is not regulated nor prohibited by law?

 

The question of where to incorporate your Exchange is a commercial decision for you and you alone to decide.

 

That said the main difference between places like Seychelles/Belize/Nevis etc and Malta/Estonia etc is that such a business in Seychelles etc is not a licenseable activity nor a prohibited activity. As such it will be a lot quicker, a lot easier and a LOT cheaper to set up there (You could potentially be incorporated and doing business within 24 hours of engaging a Company Formation Provider and for as little as $US900).

 

In places like Malta, Estonia etc such a business is a Licenseable activity. As such if you want to incorporate such a business in Malta/Estonia etc you MUST apply for a license. To do this will take anywhere between 6 weeks and 6 months and cost anywhere from $13,000 to as much as $US30,000.

 

Whether to go down the licensing road or not, again, is a commercial decision for you and alone to decide.

 

The advantages of having a license are business certainty, you will probably attract a better quality of customer and you will have a wider choice of banking partners.

 

The downside is the time it takes to establish, the cost to establish and red tape ongoing (eg if you incorporate in an unregulated jurisdiction you won’t need to collect DD/KYC etc re each customer making a lot easier to onboard new customers).

 

Would you like to know more? Then please Contact Us:

 

www.offshoreincorporate.com

 

info@offshorecompaniesinternational.com

 

ocil@protonmail.com

 

oci@tutanota.com

 

oci@safe-mail.net

 

ociceo@hushmail.com

 

How To Maintain Offshore Privacy

Are you worried about CRS or about your name appearing in an Offshore Company’s statutory records (ie the “register of beneficial owners”) as a/the beneficial owner of a Company?

 

There are 3 issues here you will need to consider:

 

  1. Compliance requirements
  2. Legal position
  3. Exchange of information

 

Let’s address each issue in turn:

 

Compliance requirements

 

Regarding 1, these days, in almost every “Offshore” jurisdiction when you form a Tax Free Offshore Company your International Corporate Service Provider has to keep, in the Company’s registered Office, a register of beneficial owners.

 

Most country’s compliance requirements in this regard state that a natural person’s name must appear in the register… Which, frankly is a joke because it ignores the legal integrity of the structure particularly where the shareholder of the Company is a Seychelles Foundation (see below). The dilemma your ICSP ie International Corporate Service Provider (such as OCI) faces is, regardless of the legal structrure of the shareholder entity, if the ICSP doesn’t write in the beneficial owners register the name of a natural person your ICSP could be fined and or lose its Corporate Service Provider License/Sublicense in that jurisdiction.

 

Thus far Compliance Officials on the ground in the country of Incorporation usually require, where the shareholder of the Company is a Foundation, that the name/s of the Foundation beneficiary/s appear in the Company beneficial owner’s register. That doesn’t mean as a matter of law (which is what really counts eg if there were ever to be a tax investigation or law suit) that you are in fact/law the beneficial owner of the Company. Which brings us to the 2nd issue above… ie Legal Position:

 

Legal Position

 

What the smart person does these days typically is he/she sets up a Seychelles Foundation to hold the shares of his/her Tax Free Offshore Company.

 

Let’s assume that the shareholder of your current or proposed Offshore Company is a Seychelles Foundation.

 

The Foundaton is in essence Europe’s version of a trust. It begain in Liechtenstein in the 1600s, was picked up by Holland etc and then made its way offshore where in Panama it became a legal sensation. Other nil tax jurisdictions (most notably Belize and Seychelles) have picked up on the utility and market attractivess of the Foundation and created their own version thereof with improvements on the Panama model.

 

The key differnce between a Foundation and a Trust is that a Foundaton is a separate legal entity ie it can sue and be sued and it can own property as both legal owner and beneficial owner. Contrast that with a Trust – at law if a Trust buys real estate, on the Title Deed -  in the space where the owner’s name appears -  it will say John Smith Trustees Ltd as Trustee for the XYZ Trust > The Trustee is the legal owner of the Property but the beneficial owner/s of the propery, at law, is the Trust beneficiary/s.

 

In short under European and etc common Law a Foundation is presumed at law to be both the legal and beneficial owner of any asset it holds. One jurisiction ie Seychelles has actually codified that position:- Section 71 of the Seychelles Foundations Act provides that a Seychelles Foundation is both the legal AND beneficial owner of any asset that it holds. (To view the legislation click on this link: https://seylii.org/sc/legislation/act/2009/32 )

 

Given the wording of the legislation any qualified Lawyer would tell you it’s inarguable… that as a matter of law (and regardless of what may appear in the beneficial owner’s register) the beneficial owner of any asset held by the XXXX Foundation Registered in Seychelles is the Foundation itself…

 

Exchange of Information

 

The final thing you’ll need to consider is Exchange of Information.

 

Generally speaking local authorites can only find out, as of right, who’s behind a Company or Foundation if the country in which the entity is registered has a TIEA (“Tax Information Exchange Agreement”)  with your home country.

 

Moreover typically there will be no requirement under the laws of youur Offshore Company’s Jurisdiction forcing the jurisdiction to share with your home country (or any other country) the name of the “beneficial owner” of the Company.

 

Hence if you set things up carefully the only way that information could potentially be exchanged is pursuant to the MCAA (“Multi Competent Authority Agreement”). The MCAA is a multi-party treaty that gives effect to CRS (Common Reporting Standards) also known as AEOI (“Automatic Exchange of Information”). In short each of the MCAA Treaty Member countries (around half the world’s countries have signed) have agreed to, once each year, automatically share with all the other treaty member countries details of Corporate bank accounts where the beneficial owner of the Company is a non resident.

 

If your Offshore Company(“OC”)’s Bank Account is located in a country which has signed the MCAA the Company’s Bankers might potentially advise of (ie to the home country of  the Company’s beneficial owners) the existence of the OC’s bank account.

 

The first thing to note here is that the Exchange (of Information) can/will only take place where the primary purpose of the bank account is to receive passive income (It doesn’t apply if your Company owns/operates a business or mercantile operation or trading operation). Additionally to limit the possibility of the existence of the OC’s bank Account coming to the attention of your local authorities (a) you will want to open the company’s bank account in a country which is NOT a signatory to the MCAA  and/or (b) you will want to set up a Seychelles Foundation to hold the shares of the OC (see above).

 

In any event there is a catch all fool proof way to avoid AEOI + the risk of your name appearing in your Offshore Company’s records as “beneficial owner” thereof; that is, by deploying a Charity or Nominee to act as the sole beneficiary of the Foundation at the time that the beneficial owner’s register is created/ noted and or when the Company’s bank account is opened.

 

Most ICSPs can/will supply a Nominee beneficiary for a fee.

 

Local laws can have an impact. Hence it would be wise to seek local legal/tax/financial advice before committing to set up an Offshore Company Trust or Foundation.

 

Would you like to know more? Then please Contact Us:

 

www.offshoreincorporate.com

 

info@offshorecompaniesinternational.com

 

ocil@protonmail.com

 

oci@tutanota.com

 

oci@safe-mail.net

 

ociceo@hushmail.com

 

 

 

How To Launch a Cryptocurrency Exchange in Malta

With the passing of legislation regulating cryptocurrencies, ICOs, and associated technology service providers, Malta has announced itself as a major Fintech player (and is even being referred to as “The Blockchain Island”). Malta’s worldly attitude towards cryptocurrencies and Distributed Ledger Technology (“DLT”) has recently seduced some of the world’s biggest cryptocurrency exchanges, motivating them to redomicile to, or open fresh offices, in Malta.

 

The legal framework is pragmatic with its prime focus being on:

  • Consumer protection
  • Market integrity &
  • Financial stability.

 

The primary legislative tool which will regulate cryptocurrency exchanges licensed in Malta is the Virtual Financial Assets Act (hereinafter the ‘VFAA’ or the ‘Act’) which was originally tabled in Parliament in April 2018, (and has just passed into law – see below Legislation Update). The VFAA, (along with the Technology and Service Providers Act and the Malta Digital Investment Authority Act) sets out the regulatory framework for DLT Assets.

 

Primary Obligations

 

To be able to operate as a VFA Exchange, a license is required from the Malta Financial Services Authority (‘MFSA’).

 

Key Persons behind the proposed VFA exchange will need to undertake a fit and proper test: – The MFSA will need to be satisfied that the applicant/s can/will comply with and adhere to the  the requirements of the VFAA and any other subsequent or related guidelines as may be prescribed.

 

PHYSICAL PRESENCE REQUIREMENT: If the applicant is a natural person/s, this person/s will need to be domiciled in Malta. Where the applicant is a Company, the Company may be incorporated in Malta. Alternatively the Company can be incorporated abroad in a “reputable jurisdiction” but it must set up a branch office in Malta.

 

PROGRAMME OF OPERATIONS: The Applicant/Licensee must at all times have, and must submit to the MFSA for initial approval, a Manual documenting and explaining the business/operational/IT etc  systems, security access protocols and any other items as the MFSA may from to time require you to include in the manual.

 

VFA EXCHANGE OPERATOR (OPTIONAL): The act provides for a VFA Exchange Operator to (at the discretion of the business) be appointed. If so appointed the VFA Exchange Operator’s role will be to manage and operate the business of the VFA exchange. This role however may be performed by the VFA exchange itself. Where a VFA Exchange Operator is appointed, the MFSA will decide, by means of Rules, how the different duties are going to be allocated as between the VFA exchange and the VFA exchange operator.

 

FINANCIAL INSTRUMENTS TEST: The Financial Instruments Test is a mandatory requirement for issuers of ICOs. That said, it may help all license holders to decide (a) whether a DLT Asset would qualify as a “VFA” within the ambit of the VFAA or (b) whether it should be regulated under any other law or (c) whether it should be exempt from regulation altogether.

 

STEPS TO GETTING A CRYPTO EXCHANGE LICENSE IN MALTA:

 

Here are the essential steps/stages involved in applying for a Cryptocurrency Exchange License in Malta:

  1. The application and supporting documents are prepared
  2. A Preliminary meeting is held with the “MFSA”
  3. The MFSA Authorisation Unit will review the application docs and provides feedback
  4. In Principle approval is then given (ie The license is approved subject to the applicant providing certain further docs or info)
  5. The Applicant fulfils the outstanding requirements
  6. The License is Issued

Timeline: Minimum 3 months

Cost: Circa $US30,000

 

Malta Cryptocurrency Exchange Legislation Update

 

On 20 July this year (2018) the Parliament of Malta approved and enacted three pieces of Legislation aimed at regulating Distributed Ledger Technology (hereafter referred to as “DLT”) and services relating thereto. The primary Act governing the licensing and operation of Cryptocurrency Exchanges is the Virtual Financial Assets Act (herineafter the “VFA Act” or “the Act”) – a copy of which can be accessed via this link: https://parlament.mt/media/95198/act-xxx-virtual-financial-assets-act.pdf ). The Act purports to regulate, amongst other things, the issuing of ICO/Virtual Financials Assets, (hereinafter referred to as ‘VFAs’) in or from within Malta.

 

One of the primary activities regulated by the VFA Act is the setting up and operation of DLT Exchanges and VFA exchanges. (The VFA Act defines a DLT exchange as any trading and, or exchange platform or facility on which any form of DLT asset may be transacted. )

 

A DLT asset is classified as any virtual token, virtual financial asset, electronic money, or financial instrument that is intrinsically dependant on or utilises DLT. The term VFA exchange refers to any DLT exchange on which only VFAs may be transacted in accordance with the rules of the platform or facility.

 

A virtual financial asset (“VFA”) means any form of digital recordation that is used as a digital medium of exchange, unit or account and that is not electronic money, a financial instrument or a virtual token. Resultingly exchanges on which only financial instruments are traded, shall not be licensable under the VFA Act but will fall within the jurisdiction/application of the Investment Services Act.

 

Primarily the VFA Act provides that before a VFA can be offered to the public in or from within Malta (or before a VFA can be traded on a DLT exchange) the issuer of the VFA must compile a whitepaper (in compliance with the requirements set out in the act) and have it registered with the MFSA. Additionally, the VFA Act purports to regulate/control the structure and content of the whitepaper, likewise any advertisements placed by the issuer of the VFA.

 

In terms of VFA Services to able to operate a VFA Exchange in or from Malta (eg under the guise of a Malta Company)  a person (or company as the case may be)  would need a licence granted by the MFSA as provided for in the VFA Act. The VFA Act specifically sets outs the licensing requirements that licensees wishing to offer VFA Services in or from within Malta will have to meet. The VFA Act also outlines the procedures as regards how to go about applying for such a license and the issuance of the said licence/s.

 

The Act also provides that an application for a licence under the VFA Act can only be made via a VFA Agent which is duly registered under the VFA Act. Apart from having to be registered by the MFSA, such individual must be authorised to carry out the profession of advocate (ie Lawyer), accountant or auditor. (OCI has achieved this requirement with our In House Lawyer having taken on a Consultant Advocate role at/with a Maltese Law Firm).

 

The VFA Act also makes it mandatory for a licencee to appoint or engage the services of an ‘administrator’ or ‘board of administrators’. The administrator (or board of administrators as the case may be) is/are entrusted with the duty of carrying out representative and fiduciary responsibilitiess on behalf of the licencee. The Administrator “must be of good repute, possess sufficient collective knowledge, skills and experience and commit sufficient time to perform their duties and be able to understand the licence holder’s activities, including the main risks”.

 

The VFA Act also contains other provisions which are aimed at stopping market manipulation by licence holders. Activities including insider dealing, unlawful disclosure of inside information and market manipulation are specifically prohibited under the Act.

 

The law also makes it incumbent on the VFA exchange to show that, at all times, it has effective systems, procedures and arrangements in place to monitor and detect market abuse. Whenever the possibility of any such activity is suspected by a Licensee, there is a mandatory requirement to report this finding to the MFSA.

 

The VFA Act also (as is common with such legislation) prescribes:

 

  • the regulatory and investigative powers of the Minister
  • the various duties of auditors
  • sanction options and remedies; &
  • the procedure for appeals against various decisions of the MFSA.

 

Would you like to know more? Then please Contact Us:

 

www.offshoreincorporate.com

 

info@offshorecompaniesinternational.com

 

ocil@protonmail.com

 

oci@tutanota.com

 

oci@safe-mail.net

 

ociceo@hushmail.com

 

 

Delaware Company Types – The C Corporation

These days the Delaware C Corporation (also known as a General Corporation) is the most commonly incorporated Company type in Delaware.

 

Entrepreneurs are attracted by the Delaware C Corp’s ability to go public and raise capital by selling shares in the company. This type of corporation is also often used by startups looking to attract venture capital.

 

The Delaware C Corp has a typical Corporate/Legal structure: shareholders own the company via shareholdings, Directors run the company and are responsible for its strategic management, whilst officers (eg Managers, the CEO etc) manage the company’s day-to-day business.

 

Are You Thinking of Going Public?

 

So you market, or are about to market, a unique service or product! Your business is up and running and is growing (or is in the incubator stage). If you are in this position, you may find yourself, before too long, weighing up the option of going public.

 

Offering shares in your company to the general public for the first time is called an Initial Public Offering, or IPO. If you’re considering where or how to launch your IPO, look no further than Delaware. Almost all American IPOs in the last 25 years have been launched under the framework of a Delaware General Corporation (ic C Corp).

 

Delaware C Corp – General

 

So what is a Delaware General Corporation/C- Corp?

 

A Delaware General Corporation has three pillars of influence: shareholders, Directors and Officers. Each of these groups has different rights and responsibilities within the corporation.

 

Shareholders

 

The shareholders of a C Corp own the company, but do not manage the company. Typically, holders of common stock receive one vote for each share they own, and they have the right to elect the members of the Board of Directors. (They also have the right to vote on certain other matters of major significance to the company).

 

Any stockholder who holds a majority of the issued shares in a C Corp can control the company. Majority shareholders typically hold a larger amount of responsibility / power than minority shareholders.

 

Generally, minority shareholders hold no responsibility for, or re, the company, and are able to assign, via proxy format, their votes to anyone of their choosing. Typically minority shareholders can also sell their shares whenever they want (though this can be modified by reference to a Shareholder’s agreement).

 

C Corp Shareholders can/will receive 2 potential benefits: first, dividends (ie a share of the company’s profits) paid in proportion to the percentage of stock held (ie when/if the Board of Directors decided to declare a dividend); and second, by the increased value of their shares as the company grows.

 

Directors

 

The Directors run the company and are responsible for the company’s overall management/direction/results. They take responsibility for all major business actions, such as the issuance of shares, the hiring of officers, the hiring of key management, commercial decisions, the establishment of corporate policies’ and the setting of salaries and compensation packages.

 

The Board of Directors decides if a dividend will be paid to the shareholders and, if so, how much. Individual directors may also own shares in a C Corp.

 

Directors of a Delaware C Corp have certain fiduciary responsibilities to the company (known as Directors duties). They must be loyal to and not in conflict with the company; they must make informed, independent decisions; they must not act in bad faith (eg as self-dealing or fraudulent dealings); and they must act in the best interests of the company and its shareholders.

 

Directors may make decisions and take action in pre-schedules meetings (ie where a quorum is present, or without a meeting – by unanimous written consent of all Directors. Directors cannot donate or sell their votes to other directors, nor can they vote by proxy.

 

Ordinarily, Directors may be removed and replaced – with or without cause - by the majority vote of the shareholders. (This is why a majority shareholder can/does control the company).

 

Officers

 

The officers of the company work for the Board of Directors and handle the day-to-day business of the company. Officers carry out the Board’s decisions and implement the Board’s policy. Officers are usually the President, Vice President, Secretary and Treasurer. However, the Board may appoint other officers, such as a C.E.O., C.F.O., C.I.O., Sales Manager, Operations Manager or any other title ithe Board may wish to create.

 

Officers may be compensated with shares, or they may buy shares in the company as the Board of Directors may decide.

 

Why Delaware?

 

There are several good reasons why almost all US IPOs are Delaware general corporations/C Corps: Smart Investors don’t invest in good ideas – they prefer to invest where they can see they will receive/own a tangible, measurable proportion of the Company’s profits originating from the ideas. A shareholding offers such certainty.

 

Many IPO Professional Advisers would say that, through its general corporation provisions, Delaware offers the most versatile and functional toolbox of share structures. Stock choices available to a Delaware C Corp include blank check preferred stock, super-voting powers, stock options and stock warrants. With these features, + the added ability to tailor shareholders entitlements via reference to a shareholders’ agreement, a Delaware C Corp can provide entrepreneurs with a number of ways to attract investors.

 

Blank check preferred stock is one common example of a left field way to attract or secure an investor. You can structure your Delaware C Corp right from the start with an optional second class of stock that gives you the latitude to offer special deals to certain/significant investors.

 

Another such option is Preferred stock. Preferred stock lets you negotiate dividend rights, the votes per share, the security interests in the company’s assets and the potential to convert the preferred shares into common shares at a future date. Preferred stock can be very attractive to investors,  yet costs very little to issue.

 

Below are just two examples of how preferred stock can act in your favor in an IPO.

 

Using Preferred Stock to Attract an Investor

 

Let’s say you have an investor or interested party who, for whatever reason, hasn’t demanded shares in exchange for his or her investment, until now. To date the investor has put nominal sums into the business but now, on the verge of your IPO, wants a major percentage of the shares to be issued.

 

A Delaware C Corp can enable you to approach that investor and offer a very attractive deal: The terms of the deal are negotiable as, under Delaware law, you have the flexibility to reach a deal on terms agreeable to both sides.

 

You might, for example, offer the investor, 100,000 shares of (preferred) stock at $10 each with preferential terms, such as: 1) a guaranteed annual dividend of $1.00 per share (thus guaranteeing a 10 percent return to the investor); 2) no voting rights until the company goes public (meaning – you’re not diluting your own power); and 3) the preferred stock would be transferable to 1,000,000 shares of common stock one year after the Company goes public. The end result? You’ve delivered to the investor the prospect of a substantial return on his/her investment without diluting your ownership stake!

 

Keeping Control

 

If you’ve been unusually successful at raising investor capital before the public offering, it’s possible that your share of ownership has shrunk (or is in danger of shrinking) to close to 51 percent (at which level you only just have control of the company).

 

To ensure you retain control well into the future, at that point, (ie while you still retain majority control of the company), what you could do is you could issue 100,000 shares of preferred stock to yourself with certain special terms eg: 1) no dividend entitlements (thus eliminating potential investor objections); and 2) voting rights of 100 votes per share on all matters shareholders might vote on (thus maintaning your voting power notwithstanding that you may have divested yourself of more than 50% of the common stock).

 

Even if you continue to attract investment money that further dilutes your ownership percentage, in this scenario you have delivered yourself 10,000,000 extra votes, which is more than enough to offset the voting rights of the other outstanding shares.

 

Stock Offerings

 

The issuing of Common stock in the case of a Delaware C Corp is governed by law; each share of common stock in a Delaware C Corp is entitled to one vote, and common shareholders are entitled to a proportionate share of common stock dividends (if a dividend is declared) ie in proportion to the percentage of shares they hold.

 

Contrast that with Preferred stock which has no set prescription or formula under Delaware law. Preferred stock in a Delaware C Corp can be issued with or without voting rights and the Stocks’ terms are open and limited only by what the Board of Directors and Investors negotiate. In short Preferred stock in a Delaware C Corp can be structured in such a way as to offer the investors preferential financial assurances without the investors receiving voting rights.

 

A Delaware C Corp does not have to issue Preferred stock or Common stock – they can be deployed in tandem. In fact, one common method of preserving insider voting control when raising investment capital is to use preferred stock in addition to common stock.

 

In some preferred stock designs, certain stockholders may be entitled to superior dividends and/or liquidation rights (ie in the event that the company files for bankruptcy protection) and/or afforded other considerations. Additionally, a Delaware C Cop can retain the right to buy out preferred stockholders at a given price, or at a certain date in the future for a price based upon a particular formula. The flexibility and adaptability of the preferred stock model truly represents one of the prime advantages of the Delaware C Corp legislation.

 

Preferred Stock – Other Key Elements

 

Some corporate lawyers refer to Delaware C Corp stock as “blank check preferred stock” because the scenarios described above are both possible with the same class of preferred stock. So, too, are other scenarios if you have issued enough preferred stock – you simply classify the stock into different series and make arrangements with investors as circumstances dictate.

 

If the preferred stock has already been authorized, you can issue it to the investor on a same-day basis and complete the deal without a lengthy escrow period (ie/eg if doing so is to your advantage). The “blank check” reference arises from the fact that in effect you are issuing pieces of paper as you proceed, as many as required (providing investors accept them) in order to generate capital.

 

Another important thing for IPOs to be aware of is a basic principle of Delaware company law, ie in a Delaware general corporation/C- Corp, the Directors set the price of the stock. What this means is that the price of your stock is set by what the Directors say it is worth and/or by what investors believe it is worth (ie regardless of what the actual value of capital or assets held by the Company may be). The investors are in effect gambling on the future viability of your company – their judgment as to the future value of your company is what determines the share price, both when you sell it initially and when it sells on the open market.

 

How Much Stock?

 

A key matter you will need to resolve before you form your Delaware general corporation/C-Corp is what is the quantum of shares of stock to issue?

 

In arriving at the conclusion of that conundrum you will firstly need to ask yourself these two questions:

1. How much capital do I/we need to raise? &

2. What percentage of the company am I willing to forsake for that amount of money?

 

Let’s assume you plan to raise, via private offering, (a) $100,000 in year 1, then (b) a further $1,000,000 via a second private offering in year 2, then (c) an additional $25 million via an IPO after three or four years.

 

Say for the first offering ($100,000), you’ve decided you’ll give up 10% of the company, and then another 25% for the second offering of $1 million (which means you will have parted with 35% of the Company all up before you go public).

 

In this scenario, you would own 65% of the Company at the time of your IPO. However, going public is rarely that straight forward. Let’s assume (a) you’ll need to set aside some stock, or stock options, to attract gun staff and (b) you’ll probably need to assume that other needs will also eat into your ownership stake.

 

This is when blank check preferred stock can come into play: As your ownership percentage of common stock shrinks, you can retain majority voting rights (and control of the Company) via issuance of preferred stock as you may specify. This will enable you to achieve a balance between attracting investors (along with productive coworkers) while avoiding the prospect of being voted out and losing control of your company.

 

Once you’ve decided the quantum of capital you want/need to raise, you’ll then need to decide the number of shares and the value of each in order to reach that figure.

 

In many situations, a general corporation (often referred to as a stock corporation, open corporation or C corporation), is recommended, especially when a Company goes public or plans a private Offering of Stock.

 

General corporations are also typically used when a company wants to attract Venture Capital Funding.

 

A cautionary note: Anyone can own part of a Delaware C-Corp, but there are a limited number of owners you can take in before the SEC potentially gets involved. Moreover you can’t advertise the sale without the SEC getting involved ie you can’t offer the investment online (hey, want to invest in my company? ads are not allowed). That said, if you know someone that wants to invest in your company it’s fine to sell them stock (ie private equity rounds are fine).

 

Before you incorporate a Delaware C Corp you should look up the SEC minimums and regulations to make sure you are following them.

 

Local laws can have an impact. Hence you should also seek appropriate legal financial and tax advice before committing to commit a Delaware C Corp.

 

Would you like to know more? Then please Contact Us:

 

www.offshoreincorporate.com

 

info@offshorecompaniesinternational.com

 

ocil@protonmail.com

 

oci@tutanota.com

 

oci@safe-mail.net

 

ociceo@hushmail.com

 

 

Offshore Asset Protection (& Tax Planning) Options for Brazilians

Given the decline of the Brazilian Economy (and the resulting political uncertainty), if you are based in Brazil and have a few dollars/assets no doubt you’d be looking at ways to protect those assets. For maximum certainty, ideally, you will be looking for ways to safely move those assets out of Brazil.

 

The solution is to set up an Offshore Corporate or Fiduciary entity and then transfer ownership of the assets to that entity.

 

As a minimum what you should do is set up a Company in a Privacy Haven (that is somewhere that doesn’t have a public register of Directors Shareholders or Beneficial Owners) to take ownership of the asset/s in the first instance.

 

For maximum security, what you could/should then do is set up a Private Foundation to hold the shares of your Offshore Company (and for ultimate protection transfer ownership of the asset/s from the Company to the Foundation).

 

Ideally, to minimize the chances of the Brazilian Authorities finding out who’s behind the Offshore Company, you will want to incorporate your Company (and your Foundation) in a country which has not signed a Tax Information Exchange Agreement (“TIEA”) with Brazil.

 

Jurisdiction etc Options

 

If that plan makes sense to you, you might want to take a close look at the following jurisdictions – as all offer ownership privacy, none of them have signed a TIEA (ie Tax Information Exchange Agreement) with Brazil and all charge no tax on profits realized outside the country of incorporation/registration:

 

 

By far the most popular place to incorporate an Offshore Company is Hong Kong. Check the following link which explains why: https://www.dropbox.com/s/4g1xroin3c8vkoa/Why%20Incorporate%20in%20Hong%20Kong.docx?dl=0

 

If you want to have the option of only having to declare in Brazil income actually paid to you by the Offshore Company:

 

(a)  As Brazil has CFC ie Controlled Foreign Corporation Laws, it would be wise to include a Foundation as part of the Corporate structure. Check the following link which explains why, in detail: https://www.dropbox.com/s/fgv089hjpv5d7e6/Why%20set%20up%20a%20Foundation.pdf?dl=0

 

(b)  For maximum privacy and to minimize the chances of your Offshore Company being taxed onshore (as a Company which is seen to be managed and controlled from onshore can be taxed onshore) you would be wise to include a Nominee Director/Shareholder as part of the Corporate Structure. For information on how/why that will work for you (and for guidance on whether to select Nominee Services or not) please read these pages:

 

http://offshoreincorporate.com/faq/should-i-engage-nominees-or-should-i-direct-and-hold-the-shares-in-my-offshore-company/

 

http://offshoreincorporate.com/faq/how-can-i-protect-my-underlying-ownership-of-my-offshore-company-where-a-nominee-is-engaged-to-act-as-director-or-shareholder/

 

New/local laws can have an impact. Hence you should seek local legal financial and tax advice before committing to establish an Offshore Corporate or Fiduciary Structure.

 

Would you like to know more? Then please Contact Us:

 

www.offshoreincorporate.com

 

info@offshorecompaniesinternational.com

 

ocil@protonmail.com

 

oci@tutanota.com

 

oci@safe-mail.net

 

ociceo@hushmail.com

 

Isle of Man ICO Setup Requirements – Overview

The Isle of Man is becoming a popular choice of jurisdiction for Cryptosphere Entrepreneurs looking for a middle ground solution between excessive regulation and zero regulation.

 

In short you can incorporate an ICO in the Isle of Man (“IOM”) and have the business officially registered as an ICO without needing to go through a formal license application such as exists in other Financial Centres.

 

Below is a series of Commonly Asked Questions (and Answers thereto) recently published by the IOM Authorities which should provide a neat summary of everything you will want/need to know when beginning your assessment as to the viability of choosing the Isle of Man as your preferred ICO Launch site:

 

Where does the business of issuing Convertible Virtual Currency (“CVC”) (such as via an Initial Coin Offering “ICO”) fit in Isle of Man legislation?

 

In April 2015 the Proceeds of Crime (Business in the Regulated Sector) Order 2015 amended Schedule 4 to the Proceeds of Crime Act 2008 which lists all of those businesses considered by that Act to be “Business in the Regulated Sector”. One type of such business is convertible virtual currency business which Schedule 4(1) (mm) to that Act describes as:

 

the business of issuing, transmitting, transferring, providing safe custody or storage of, administering, managing, lending, buying, selling, exchanging or otherwise trading or intermediating convertible virtual currencies, including crypto-currencies or similar concepts where the concept is accepted by persons as a means of payment for goods or services, a unit of account, a store of value or a commodity (emphasis added)

 

Therefore issuing CVC (which could be via an ICO or other concept), in or from the Island falls under the above definition and so is classed as “Business in the Regulated Sector”.

 

So does this mean that all business areas listed as “Business in the Regulated Sector” under Schedule 4 to the Proceeds of Crime Act 2008 are regulated by the Isle of Man Financial Services Authority (“IOMFSA”)?

 

No. “Business in the Regulated Sector” does not necessarily mean that the business is regulated in the contemporary sense of the word.

 

“Business in the Regulated Sector” for the purposes of the Proceeds of Crime Act 2008 means that additional legislation applies to those businesses (namely the Anti-Money Laundering and Countering the Financing of Terrorism Code 2015 or “the Code”).

 

Many of the business sectors in Schedule 4 are fully regulated by the IOMFSA, for example, under the Financial Services Act 2008 or the Insurance Act 2008. These businesses are subject to a wide array of regulatory controls and are subject to detailed scrutiny as required by the terms of the legislation they are regulated under.

 

Some businesses listed under Schedule 4 are only overseen for compliance with the Code. These businesses are called Designated Businesses. Their oversight does not extend to conduct of business, prudential and solvency regulation or protection of client assets. For the avoidance of doubt, businesses operating as CVC businesses (including ICOs) fall under this category.

 

If I am registered, what are my legal obligations?

 

The Designated Businesses (Registration and Oversight) Act 2015 imposes a number of obligations on the business. Some of those requirements include that it must keep all of the information submitted as part of its application for registration accurate and up to date, file an annual return and provide information or documentation to the IOMFSA upon request.

 

The AML/CFT obligations imposed on the business are detailed in the Code. In summary it requires that the business must identify and take reasonable steps to verify the identity of their customers including the beneficial owners of the customers and any persons who are empowered to act on their customers’ behalf. The Code also requires that the business must assess the risks facing it as well as the risks posed by its customers and monitor the transactions and activity of the customers on an ongoing basis.

 

Can I start the pre-sale of a token or coin before being registered or while the registration is being processed?

 

No. The business of selling or issuing a convertible virtual currency is undertaking a designated business. No distinction is made as to whether the sale or issuance of a CVC is undertaken as a pre-sale or after a public launch. Care should also be taken to ensure that the business is not holding out as undertaking a designated business prior to its registration.

 

So, if an ICO business is “overseen” by the IOMFSA for AML/CFT compliance, is it therefore “licensed”, “authorised” or otherwise regulated by the IOMFSA or hold a “cryptocurrency licence”?

 

No. The business of issuing, transmitting, transferring, providing safe custody or storage of, administering, managing, lending, buying, selling, exchanging or otherwise trading or intermediating convertible virtual currencies is a Designated Business as defined by Schedule 1 to the Designated Businesses (Registration and Oversight) Act 2015. This means it is subject to registration under that Act – not financial services regulation.

 

A Designated Business is not a regulated entity and must not hold out that it is anything but a registered Designated Business.

 

Are there any types of CVC business (including ICOs) which the IOMFSA would refuse to register?

The IOMFSA has published a registration policy which outlines what it expects of an applicant in terms of fitness and propriety.

 

In addition to this general registration policy, it is the IOMFSA’s policy to refuse to register an applicant which engages in the CVC business of issuing a CVC (of whatever type) where the CVC issued provides no benefit to the purchaser other than the CVC itself.

 

Examples of this include, but are not restricted to:

 

  • · ICOs which convey:

- limited or no rights to the income generated from a project;

- limited or no rights to use the assets developed, purchased or acquired from the funds raised by the ICO;

  • · ICOs where there is no reasonable basis for any expected capital growth of the value of the CVC.

 

Such characteristics are generally considered by the IOMFSA to pose an unacceptably high risk that the money raised from the CVC issuance could be used for unanticipated and illegal purposes, as well as posing a risk to consumers. It is because of these risks that it is the policy of the IOMFSA to refuse to register this type of business.

 

If a Designated Business is registered with the IOMFSA, is it required to state this on its website and other correspondence?

 

There is no requirement on a registered Designated Business to state that it is registered under the Designated Businesses (Registration and Oversight) Act 2015 to persons with whom it has communications in the course of its business. However where a business chooses to make such a reference, it should be made very clear that the business is registered under the Designated Businesses (Registration and Oversight) Act 2015 and the business must not ‘hold out’ that it is regulated.

 

Where a business is “registered” with the IOMFSA as a Designated Business, what requirements are imposed on the registered business?

 

As noted above, all businesses listed in Schedule 4 to the Proceeds of Crime Act 2008 are required to comply with the Anti-Money Laundering and Countering the Financing of Terrorism Code 2015 (‘the Code’). The IOMFSA has powers under the Designated Businesses (Registration and Oversight) Act 2015 to oversee compliance with the Anti-Money Laundering and Countering the Financing of Terrorism legislation (which includes the Code, including powers to inspect the accounts, books and records of the business and take copies of those records).

 

Further details about potential legal or regulatory obligations and how they impact your business should be sought from an independent legal practitioner prior to making an application for registration. No designated business must be undertaken without a registration.

 

How do I apply for registration to issue CVC (including via an ICO) on the island?

 

First you need to ensure your business is of a type the IOMFSA will register, and that it has the necessary number of Island directors and is managed and controlled from the Island (see the Designated Businesses Registration Policy page: https://www.iomfsa.im/designated-business/registration-policy/ ).

 

Then, to begin the process you need to create an account on the application system, to do this you can go through the link below: https://www.iomfsa.im/designated-business/registration-forms/

 

This page provides a high level outline of how to go about registering. At the bottom of the page is a link to the registration system itself, once you create an account you will be able to complete the application forms.

 

There is a detailed user guide which takes you through step-by-step how to use the system and how to complete the forms: https://www.iomfsa.im/media/1423/dnfbpuserguide.pdf

 

Does being registered under the Designated Business (Registration and Oversight) Act 2015 mean I can get a bank account and banking services in the Isle of Man?

 

No. Whether a bank will offer services to your business is a commercial decision for the bank to make and is a matter between your business and the bank.

 

CAUTIONARY NOTE: It would be highly advisable to engage an experienced International Corporate Service Provider to assist with formation of the Operating Company and with the ICO Registration Process. There are a number of unseen reefs you will need to successfully navigate your way around (ie legal boxes you will need to tick) in order to succeed with your registration application. Your chances of succeeding without specialist help would be greatly reduced. (The OCI Legal Team can provide such assistance).

 

Would you like to know more? Then please Contact Us:

 

www.offshoreincorporate.com

 

info@offshorecompaniesinternational.com

 

ocil@protonmail.com

 

oci@tutanota.com

 

oci@safe-mail.net

 

ociceo@hushmail.com

 

 

How To Use a Tax Free Offshore Company to Trade Commodities

Commodity Trading is an activity which lends itself well to an Offshore Corporate Structuring Plan.

 

To summarise how it would work is:

 

  • You set up a zero tax International Business Company (“IBC”) with a nil jurisdiction based “Nominee” Director
  • The IBC opens an account with a Broker
  • You are appointed by the Company as the IBC’s authorised trader (ie you place the buy and sell orders on behalf of the company)
  • For all intents and purposes the IBCs trading profits are generated in a nil tax environment tax free/offshore (ie provided the IBC Is structured properly)
  • When you need some living/spending money the IBC pays you a wage, or consulting fees or a commission (eg a percentage of trading profits generated)
  • That living/spending money can be paid to your local bank account (which means it would be assessable income wherever you are ordinarily resident for tax purposes though you should also be able to claim a sizeable amount of allowable deductions eg for home office, car, equipment, insurances, travel, stationary etc etc to reduce the amount of your “taxable” income at home)
  • If you don’t want the authorities to know how much money you are earning by way of wages you could use an anonymous ATM or Debit/VISA card to withdraw your wages from an Auto Tele Machine
  • The majority of trading profits could be reinvested Offshore potentially tax free.

 

Local laws can have an impact. Hence you should seek local legal/tax/financial advise before committing to set up a Company for such purposes.

 

Would you like to know more? Then please Contact Us:

 

www.offshoreincorporate.com

 

info@offshorecompaniesinternational.com

 

ocil@protonmail.com

 

oci@tutanota.com

 

oci@safe-mail.net

 

ociceo@hushmail.com