An International Business Company or Corporation (also known as an IBC) is just one type of offshore company. IBCs are usually formed by investors or business people in a country outside their own country of residence. They are typically a corporation or Limited Liability Company (LLC).
People who create an IBC in a foreign country will then open a bank account in the company’s name. The international company will receive income as it engages in its business operations.
The United States, and other major business locations, has become known as a high-tax jurisdiction with disproportionate probability of lawsuits. Therefore, IBCs are formed in jurisdictions such as Antigua, Anguilla, the British Virgin Islands, the Bahamas, Belize, Gibraltar, Nevis, and Seychelles.
The Internet has caused the creation of many companies that have no brick-and-mortar storefronts, but are essentially digital organizations. Location has become less important in the scheme of things when creating a business. In many cases, business transactions can be performed via email, fax, and through websites. Since a company can be successful regardless of its location – whether it is in China or Gibraltar – many investors are considering the benefits of an offshore company.
Typically, IBCs are permitted to engage in a variety of different types of businesses, from futures trading, financing, and investment management. They are exempt from local taxation and duties; however, they must still pay annual fees, such as agent’s fee and registration taxes. They may not perform business within the territory in which they are formed.
One of the main benefits is the confidentiality of the company owner of IBCs. They may have a local registered agent, but all requirements for local directors or officers have been revoked. Additionally, IBCs do not need to prove actions are for the interest of the company and they can issue shares in both registered and bearer formats.