Offshore Business Formation in Panama

The Republic of Panama is on the isthmus that connects North America to South America and is the southernmost country in Central America. The Panama Canal, completed by the United States Army Corps of Engineers in 1914, is a waterway connecting The Atlantic Ocean and the Caribbean Sea to the Pacific Ocean. Tolls from the Canal make up a large portion of the country’s gross domestic product, or the value of all goods and services produced within the country. Panama’s economy is quickly growing, making it a popular choice for offshore business formation.

Panamanian Corporations, the name given to offshore businesses in Panama, are created under Law 32 of the General Corporation Law. This law provides for a flexible corporate structure while protecting privacy. It is an excellent statute for offshore businesses to develop and interact in the international business world. In fact, it is so well-designed that other jurisdictions have mimicked its framework.

This jurisdiction offers a completely tax-free haven for all offshore business activities outside of Panama. Two local citizens act as the organizers and subscribers for the incorporation, and it is customary to have a local registered agent in Panama as well. At least three directors are required; however, nominee directors are typically appointed, as their information is part of public record. The jurisdiction also requires at least three officers to fill the roles of president, treasurer, and secretary. The officers can be individuals, corporations, or some other entity. While an officer may hold more than one position, he may not be both president and secretary. Those named as directors can also be officers.

Shareholder and director meetings are not required, but can be held in any country or by way of virtual meetings. Panamanian Corporations have no reporting requirements nor are there any exchange controls or restrictions.

http://en.wikipedia.org/wiki/Panama

http://en.wikipedia.org/wiki/GDP

http://www.panama-corporations-incorporate-in-panama.offshore-companies.co.uk/

Who Needs an Offshore Business?

Perhaps you’ve heard of offshore business formation, but are not certain if it is for you. Some individuals benefit from utilizing offshore companies, while others do not need them.

You may not need an offshore company if your only intention is to trade stocks or if you are not concerned about confidentiality. If you aren’t able to justify the costs of keeping an offshore business in good standing, then it may not be for you.

However, many investors and companies can benefit from an offshore business. Offshore companies afford more privacy. They do not require as much paperwork, reporting, and meetings, making them less expensive to run and easier to manage. Business run offshore typically have less taxes, and in some cases, no taxes at all.

Self-employed individuals – such as consultants or artists – can benefit from operating as an employee of an offshore company. They can act as both the sole shareholder and director, maintaining control while taking advantage of inherent benefits of offshore business formation.

Expatriates working overseas, particularly those in countries with political difficulties, may find advantages to working through an offshore business. They will be able to avoid or minimize taxes and prevent issues with exchange control in their working country.

Companies involved in investments or property can set up an offshore business to avoid taxes, such as inheritance tax or capital gains tax. In some jurisdictions, funds gained through investing can be deposited in a bank account and the interest or capital gains are kept gross.

Individuals involved in purchasing or using copyrights, patents, trademarks, or domain names sometimes use offshore companies. Royalties may be taxed at a reduced rate, although sometimes still must be taxed at its home jurisdiction.

Regardless of the reason for utilizing an offshore business, one often finds the advantages of confidentiality and protection make them a worthwhile choice. Offshore company formation shuts out the possibility of predatory lawsuits, protects retirement funds from bankruptcy, and allows for the discreet transfer of will monies.

http://www.alexandrougroup.com/en/faqs-offshore-company-incorporation.html

http://en.wikipedia.org/wiki/Offshore_company

http://www.offshoretactics.com/articles/KeyMistakesWhenBuyingAnOffshoreCompany

Offshore Business Formation in Guernsey

The offshore business jurisdiction of Guernsey is the second largest island of the British Channel Islands. Citizens speak both English and French, although the former is the official language. This small island, whose capital is St. Peter Port, is an associate member of the European Union and under European law.

The island of Guernsey is twenty-five square miles of mostly level terrain. It is located approximately thirty miles from the Normandy coast of France and seventy-five miles from Weymouth, England.

Guernsey is unique in that it issued interest-free money, as well as using gold and silver coins, during a fourteen year period following Napoleon’s wars. This move stimulated the economy, enabling the country to keep the job of creating money out of the central bank. Even today, financial services like banking, insurance, and fund management make up thirty-two percent of local income, which may be behind the jurisdiction’s decision to restrict offshore company formation in the business of banking and insurance.

The offshore business formation vehicle that Guernsey specializes in is the Exempt Private Company (or EPC). EPCs must have at least two, but no more than twenty shareholders, and no corporation may have any beneficial interest in the EPC’s shares.

Guernsey does not require corporate taxes, nor is auditing required; however, accounts must be maintained on the company. Only one director is required for a Guernsey EPC, and he or she does not need to be a local resident. A registered office in the jurisdiction is necessary, and the company must have a secretary. Director and share holder meetings can be held anywhere, either within the jurisdiction or even via a virtual meeting. Like most jurisdictions, an EPC in Guernsey cannot do business within the jurisdiction.

While confidentiality is important to most investors interested in offshore business formation, one should realize that in Guernsey, the authorities have the right to know the details of the beneficial owner of an EPC.

While individuals may choose a name for their company, they are required to end it with the word “Limited.”

http://en.wikipedia.org/wiki/Guernsey

http://www.gbsei.com/guernsey.php

http://www.acra.gov.sg/Company/Making_Changes/Annual_Return_of_Local_Company/Exempt+Private+Companies.htm

How to Incorporate an Offshore Business?

While obviously there are conditions that affect the time it takes to incorporate an offshore business, you can generally expect your new company to be formed within two to three weeks.

The steps in creating your business involve first determining exactly for what you will use your business. Are you interested in investing? Owning property? Protecting your privacy? Establishing exactly what your purpose is will make it exceptionally easier to move through the process and be happy with the results.

Next, you will need to select the jurisdiction for your offshore business. It is best to review the pros and cons of each jurisdiction. Check that the area has reliable communication and financial systems, that the political and economic situation is stable, and verify that the legal system is established. Some jurisdictions are more suitable for specific vehicles, so take this into consideration as well.

You will need to prepare the paperwork prior to submitting it to Alexandrou Corporate Services to form your offshore business. Once we receive your documentation, it will take approximately one week to finalize your documents. From that point, your paperwork will be processed, your offshore company incorporated, and the paperwork will be sent to you in two to six days.

If you are not interested in waiting that long, or would like an aged company, you can purchase an “off the shelf” company based in the jurisdiction of Cyprus. Documents will typically be sent to you in one to two business days.

A shelf company is already formed, but without an owner. It will remain “on a shelf,” so to speak, until an individual chooses to purchase it. The new owner will not have to wait as long for their incorporated offshore business and at the same time, they will receive a company that has a past and credibility that goes with that. Investors pay more for shelf companies, not only for their inherent advantages, but also in order to pay the yearly fees associated with them.

http://www.alexandrougroup.com/en/faqs-offshore-company-incorporation.html

How to Reduce Corporate Tax Bill

Businesses are continually seeking ways to reduce costs and increase productivity. Economic troubles have adversely affected many companies, causing layoffs and cutbacks. However, there is an area that businesses can trim without sacrificing quality or manpower.

More and more companies are choosing to incorporate business at an offshore jurisdiction, and many corporations are utilizing offshore banking options. These options provide businesses with a legal, effective method of reducing their corporate tax bill.

Businesses have an obligation to their shareholders to keep profits high and taxes low. Google, for instance, only paid 2.4 percent in corporate taxes in 2010 by setting up a shell company in the Netherlands to receive all profits. Ireland does not tax profits in other European Union countries. The money was then sent to Barbados, which has no capital gains tax.

In many jurisdictions, income earned on offshore accounts is paid in whole without taxes being withheld. Corporations can transfer bank accounts from their home country to an offshore jurisdiction, as Google did, so that they can benefit from this tax reduction.

Some jurisdictions do not have Capital Gains Taxes and many have signed double tax agreements with other jurisdictions, preventing the potential for being taxed twice on the same income. Even if the bank account is held in a jurisdiction without a double tax treaty, a company can establish an Intermediary Holding Company or a shell company, as Google did in the Netherlands. This holding company can be established in a country with a suitable agreement and channel investments for the business.

The various jurisdictions each offer reductions for different types of taxes as well as breaks for different company vehicles. It is important that you review the different jurisdictions to determine which one best suits the needs of your offshore business.

A reduced corporate tax bill is not the only reason to consider an offshore bank account. Other benefits for offshore business formation jurisdiction include the protection of assets, better returns, complete confidentiality, and the ease of advancing overseas business interests.

http://www.belize.com/offshore-banking.html#ixzz1ICW8VJTC

http://offshoresimple.com/why_offshore.htm#4

http://en.wikipedia.org/wiki/Tax_haven

http://www.offshorelegal.org/offshore-tax/offshore-tax/reduce/lower-tax-liability-legally-offshore.html

http://www.businessweek.com/magazine/content/10_44/b4201043146825.htm

http://simonwillison.net/2004/Apr/5/whatIsGoogle/

http://www.theregister.co.uk/2011/01/20/google_q4_2010_results/

Legality of Offshore Banking

Choosing to go offshore is a decision that requires much research and contemplation. But worrying over the legality of it is not something that should be an issue.

Initially offshore business formation was a simple process which required very little in the form of verification or paperwork. Unfortunately, criminals took advantage of this fact, twisting the beneficial process into one that fit their needs – and concealed their identity and actions. Those involved in money laundering were able to hide the details of their bank transactions, and thereby hide from the law.

Changes were made to offshore banking to help stop those involved in illegal activities. It is no longer possible to conceal any electronic money transaction – be it bank to bank transfer or credit or debit card transfer. It is also no longer possible to conceal your identity behind an offshore business if that company has an offshore bank account. These changes were made to prevent illegal activities and allow legitimate investors to continue with business as usual.

Offshore banking has become increasingly popular, especially as investors attempt to protect their investments in a global atmosphere of unstable economies. Offshore banking provides a security and flexibility that is unavailable in homeland banking.

When choosing an offshore bank, one should talk to a knowledgeable agent to prevent making costly mistakes. Offshore banks are accountable to government regulations. Therefore, choosing a jurisdiction that fits your needs is especially important. The offshore bank itself should fit your banking requirements. Some offshore banking centers are larger than others and each is different. Qualified agents will know which one will be the best option for meeting your particular situation.

Unless your purpose is money laundering, tax evasion, or financing criminal activity, offshore banking is completely legal and actually quite popular. Today’s offshore banking centers require proper proof of the company’s existence and the account holder’s identity.

http://www.offshorebankingalert.com/

http://www.web-chamber.com/offshore-money-laundering-tax-savings-or-asset-protection

What is International Business Company Act of 1990

International Business Companies, or IBCs, are private companies that are well-known for their advantages as a tax-haven. Of all of the vehicles available for offshore business formation, IBCs are the most popular choice of investors. They are formed in different jurisdictions throughout the world, but Belize is of the most popular of these locations.

IBCs are formed in Belize under the International Business Companies Act of 1990. The law is considered one of the most progressive, easy-to-utilize pieces of legislation of its kind. Made with investors in mind, the law helped make Belize the popular jurisdiction for offshore business formation that it is today.

Officials sampled all of the best pieces of legislation from other offshore jurisdictions in order to create the IBC Act of 1990. In doing so, they created a law which provided privileges previously unheard of in the offshore business world, particularly in regards to confidentiality.

In order to receive all of the benefits of a Belize IBC, companies must be incorporated in Belize by a registered agent within the jurisdiction; however, companies may only engage in business outside of the jurisdiction.

Companies are guaranteed absolute privacy, whether they are involved in tax planning, real estate holdings, asset protection, investment purposes, or international flow of capital or financing.

Other advantages to an IBC in Belize through the International Business Companies Act of 1990 include tax exemption from all income earned by the IBC. IBCs are also exempt from taxes on all dividends paid; on interest, rent, or other compensations paid out; and on capital gains on shares, debts, or other securities.

Additionally, officers need not reside in Belize and shareholder meetings can be held anywhere in the world. Attendance can even be made by proxy, further easing an investor’s responsibilities.

The International Business Companies Act of 1990 not only benefited Belize as an offshore business jurisdiction, but also benefits any investor seeking to find the best solution for their offshore business needs.

To learn more about offshore business formation in Belize please leave a comment with your contact info and we will get back to you.

http://www.incorporatebelize.com/belize-ibc.php

Offshore Business Formation Jurisdictions: Hong Kong

Hong Kong is located on the South East Coast of China and is a Special Administration Region (or SAR) of the People’s Republic of China. Both English and Chinese are used on documentation.

Unlike other jurisdictions, Hong Kong does not have specific legislation for offshore business formation consultants. The laws do not separate whether businesses are local or offshore, but all companies are treated equally, and with many benefits for offshore business formation as seen in other jurisdictions. As long as a company does not do business within Hong Kong and no income is derived through local business, then that company will not need to pay any taxes there. Therefore, while a business is not a typical offshore company in Hong Kong, it is treated as such.

Offshore-type businesses in Hong Kong are not required to do financial reporting, nor are they audited. It is necessary, however, to file a Declaration of No Business Activity in Hong Kong as verification that no income is derived within the jurisdiction.

Hong Kong enjoys a calm political climate with a legal system similar to British Common Law. Technology, communications, and banking are all thriving within this jurisdiction, and there are no exchange controls.

Neither directors nor shareholders need be residents of Hong Kong, and while they are not kept private – both are listed in government and public records – there is still a way to maintain one’s privacy. By utilizing nominees, one can remain anonymous. The nominees will be listed publicly, while the owner remains confidential. Hong Kong law does require that a local secretary is utilized.

Investors interested in reaping the benefits of an offshore business, while maintaining a low profile in a location that is not publicized as a jurisdiction for offshore business formation will find that Hong Kong is a perfect choice.

http://www.milonline.com/companies/hong-kong-offshore-company.html

Offshore Business Formation Jurisdictions: British Virgin Islands

The British Virgin Islands (or BVI) consists of four main islands – Tortola, Virgin Gorda, Anegada, and Jost Van Dyke – along with about fifty smaller islands located in the Caribbean Sea. The majority of the population of 22,000 people lives on the island of Tortola, and some of the smaller islands are completely uninhabited.

The archipelago that makes up the entire set of islands includes both the U.S. Virgin Islands and the British Virgin Islands. The BVI are a British overseas territory and maintain the same political stability as Britain itself. The currency system does not include domestic currency and uses the U.S. dollar. This is beneficial, because the government cannot regulate the money supply, and therefore, can never impose currency controls.

The BVI are a popular choice of investors interested in International Business Companies (or IBCs). Around 50,000 IBCs were incorporated there in 2010 alone. It is technologically advanced with ample transportation and international communication. It is in the Atlantic Time zone, and there is no Daylight Savings Time, making it on the same time as Eastern Standard Time, such as in New York, during the summer months.

The legislation regarding benefits of offshore company formation is advanced, often imitated by other jurisdictions in the Caribbean. Only one shareholder and one director are required, neither of which have to be individuals, but can be corporations instead. Corporate officers are not needed, and there is no need for annual general meetings. The IBC laws are very flexible regarding accounts and records, requiring only as much as the Director deems necessary.

IBCs in the BVI are completely confidential, with no legal requirements regarding divulging the identity of shareholders or directors. Additionally, since the BVI is a successful financial services sector and maintains a higher standard of living, it has no need for membership in the Caribbean Basin Initiative (or CBI). The CBI requires the release of financial information and records, thereby destroying all confidentiality achieved by an offshore company. The BVI is not a member of the CBI and maintains strict laws on confidentiality. If you would like to learn more about offshore business formation in BVI please leave a comment with your contact info and someone will get back to you shortly.

http://www.britishvirginislands-ibc-registration.com/BritishVirginIslands_Most_popular_jurisdiction.html

http://en.wikipedia.org/wiki/British_Virgin_Islands

Private Equity Company in The West Bank

Bashar Masri, a Palestinian-American investor with interests in offshore business formation, has launched the first private equity company in the West Bank. With closing capital of sixty million dollars, Siraj Palestine Fund I has had investors from Palestine as well as Arab and international businesses.

One of the chief investors was Overseas Private Investment Corporation (or OPIC), which is owned by the United States government and gives financial assistance to emerging U.S. companies. Other major investors included the Soros Economic Development Fund (or SEDF), which is a nonprofit private foundation that invests in communities affected by poverty; the United Arab Emirate Crescent Investments; and the Pension Boards of the United Church of Christ

While Siraj Palestine Fund I is not a lending company, it does invest in small to median companies within the Palestinian territories. It will provide financial assistance for five to seven years only in an attempt to improve technology, increase jobs, and help with “the acute shortage of equity capital for local businesses due to years of political turmoil,” according to Masri.

The equity company is registered as an offshore business in the Cayman Islands and as a Palestinian company in the West Bank. As it attracts international investors, its capital should reach eighty million dollars.

Masri is the sole owner of the new equity company. He has experience in business as the owner of an offshore holding company called Massar International, which has been in existence for seventeen years. Massar is responsible for building the first Palestinian city in the West Bank, Rawabi. Right –wing Israelis oppose the city, which is located near Ramallah and is still under construction.

Resources:

http://www.monstersandcritics.com/news/business/news/article_1617810.php/First-private-equity-company-launched-in-West-Bank

http://www.sedfny.org/

http://www.opic.gov/