Where To Form a Bearer Share Company


It is still possible to form a Company with bearer shares but the jurisdiction options are not what they once were…


This article should answer any questions you might have about where you might form a Bearer Share Company Offshore and what legal conditions exist in relation to the creation, storage and transfer of such Companies’ bearer shares.


What are “Bearer” Shares?


In short bearer shares are a form of Company Shareholding whereby when the Company is formed and the share certificate is printed the name of the shareholder on the certificate reads “The Bearer hereof”. In other words whoever physically holds the share certificate is considered to be the shareholder of the Company. (Company Law 101: If you own 100% of the issue shares in a Company you own the Company).


Historically in the case of a Bearer Share Company, in the share register the name of the recorded shareholder reads “Bearer”. To transfer ownership of a Bearer Share Company you simply hand over the share certificate to the new owner. (That said, for the transfer of ownership to be complete at law ideally a share sale/purchase agreement should be entered into and consideration ie payment tendered).


Where Can You Form a Nil Tax Bearer Share Company?


Whilst 90% of tax advantaged jurisdictions have abolished the use of Bearer Shares there are 4 tax haven jurisdictions that still permit the use of Bearer Shares ie Panama,  Marshall Islands The British Virgin Islands (“BVI”) & St Vincent & The Grenadines.


BVI Bearer Share Companies


A BVI International Business Company (“IBC”) can issue a wide range of shares including Bearer Shares (although a significantly higher government incorporation/annual renewal fee applies to Bearer Share Companies incorporated in the BVI).


The new BVI IBC legislation provides:

(a)       that all bearer shares must be “immobilized”. What this means is that any BVI IBC share certificates issued to Bearer must be held by an approved/licensed custodian (eg a Bank or Law Firm or Licensed International Corporate Service Provider).

(b)       In the custodian’s file a written declaration must be held noting the actual identity and address of the owner of such shares.

(c)       It’s not possible to transfer ownership of a Bearer Share Certificate by just handing over ownership to the new owner/holder. A Written instrument of transfer must be executed and KYC provided (eg proof of identity and address) to the Custodian as regards the new owner.


Panama Bearer Share Companies


Like the BVI a Panama Company can issue a wide range of shares, including Bearer Shares.


In 2015 however Panama passed legislation to effectively immobilize Bearer Share Certificates. In short, like in the BVI you can incorporate a Company in Panama with Bearer Shares but the share certificate/s must be held by an approved/licensed Custodian and KYC provided to the Custodian as regards the shareholder/owner’s ID and address.


Approved categories of Custodian in Panama include (a) local authorized custodians, and (b) foreign authorized custodians. Categories of local custodian include:

(i)        A bank holding a general license

(ii)       Trust companies authorized by the Panama Bank Superintendence

(iii)      Brokerage houses and securities clearing houses authorized by the Securities Market Superintendence; &

(iv)      Attorneys at law certified as such by the Supreme Court of Justice in Panama.


Non local Banks, trust companies, and financial intermediaries may be foreign authorized custodians if they hold a license for practicing of such business in their jurisdiction of domicile AND providing that jurisdiction is (a) a member of the Financial Action Task Force (FATF) on Money Laundering or (b) is an associated member that is registered with the SBP.


Rights over Certificates in Custody in Panama

The ownership of shares held by a Custodian may be transferred without need for the physical delivery of the certificate/s, provided (i) that the owner advises the Custodian that he/she has made the transfer and (ii) that the acquirer submits a sworn statement to the custodian that includes the required information (name and identification data, as well as contact data as regards the new owner).


The Panama law provides also for an interesting pledge system that allows for the creation of an encumbrance on bearer shares in custody, by the owner merely giving notice to the authorized custodian whereby he/she advises the pledging of the shares as well as the lienholder’s full name, physical address, telephone number, and email address.


Uniquely, a special inheritance disposition system has been created for Panama Company bearer shares that allows the owner of such shares to automatically dispose of their shares on death to a nominated successor, without need for the transfer of ownership such shares being subject to a formal granting of probate (That is a process whereby a competent Court approves a Will and the distribution of assets pursuant thereto).


Marshall Islands Bearer Share Companies


In March 2018 the Republic of the Marshall Islands (“RMI”) amended its IBC Legislation to provide for several changes including changes as regards to the use of Bearer Shares.


The effects of the RMI amendment in relation to Bearer Shares are:

(a)       Marshall Islands Bearer Share Companies must now take all reasonable steps to maintain up-to-date records of all shareholders and beneficial owners of bearer shares (as well as any later share transfers).

(b)       In order to maintain the validity at law of bearer shares in a Marshall Islands Company (including any and all rights and privileges attaching to such shares), the above-referred records must be filed/kept with the corporation’s registered agent in the RMI.

(c)       Bearer share information is recorded with the registered agent by completing the forms “Declaration of Holders and Beneficial Owners of Bearer Shares” or “Declaration of Transfer of Bearer Shares”. The forms can be obtained by either contacting your RMI Company Formation Agent or the RMI FSA directly.


Interestingly in the RMI Bearer shares do not have to be held by an approved Custodian.


St Vincent & The Grenadines Bearer Share Companies


St Vincent & The Grenadines (“SVG”) IBCs are still permitted to issue bearer shares save that, like in Panama and the BVI, such shares must be held by an approved custodian.




It is still possible to incorporate a Private Tax-Free Company with bearer shares however its becoming increasingly harder to open bank accounts for Bearer Share companies.


If you want to form an Offshore Company without your name appearing in any official record as the shareholder of the Company (and have the widest choice of banks) you’d probably be better off to incorporate a Company with a (nil tax jurisdiction resident) Nominee Shareholder (which most CSP firms, like OCI, can provide).


Moreover if you don’t want your name appearing in any official records as the “beneficial owner” of an/your Offshore Company (which in most cases would give rise to reporting/tax obligations onshore) you’d be wise to include a Private Foundation as part of your Corporate structure (in particular a Seychelles Foundation). Check these links for details:





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