Should I Select a General Power of Attorney or a Consultancy Agreement?


For legal reasons it is often imperative that your IBC be, and be seen to be, managed and controlled from offshore. The person authorized to give and receive communications might therefore be appointed, in writing, as an adviser to the Director with particular areas of responsibility. By doing this the Director’s acceptance of the adviser’s instructions may be demonstrated to be in accordance with a corporate plan thereby avoiding any suggestion that this is just a sham company. To achieve this one could be appointed by written agreement as an arm’s length Adviser or Consultant.


Another option is to issue a Power of attorney in your favor giving you the power to take certain specific actions on behalf of the company. The downside of a Power of Attorney compared to a Consultancy Agreement is that it may not look as commercially realistic (ie issuance of a Power of Attorney is more likely to leave others with the impression that you are in fact the owner or effective controller of the company).


At the end of the day Professional Company Directors, (especially say directors of Public Companies) should make decisions based on information received from the company’s managers, consultants and professional advisers. Hence if you want to have practical control over your company’s affairs without letting al the world know that it’s in fact your company you may wish to, at incorporation, hire a Professional “Nominee” Director and have yourself appointed as Consultant or adviser to the Director with particular areas of responsibility.


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