Tax and Accounting Regulations
Below is an overview of the tax and accounting regulations in the Marshall Islands:
Marshall Islands non-resident corporations, Partnerships, Limited partnerships and Limited Liability Companies are statutorily exempt from all forms of taxation in the Marshall Islands. There is zero taxation on all income, profits, dividends, royalties, compensation or other related sources of revenue.
Annual Reporting Requirements
With an international company in the Marshall Islands, there is no requirement to:
- Prepare Accounts.
- Prepare Audited Documents.
- Employ Local Auditor.
- File Annual Accounts.
- File Annual Return.
Whilst there is no obligation to file audited financial statements with local authorities, a Marshall Islands international company is required to keep financial records to reflect its financial position.
Government Licence fee and Annual Maintenance Fees:
A government license fee must be paid by all Marshall Islands international companies in order to operate. The annual cost of company maintenance would include Service Provider’s fees and governmental licence.
Recurring Annual Maintenance Fees are due on the anniversary of incorporation and include:
- Provision of registered office and registered address.
- Provision of resident agent and Company Secretary.
- Payment of annual government fees.
Company Administration Guidelines
The Marshall Islands jurisdiction includes all the necessary characteristics of an offshore jurisdiction, such as bearer shares, facsimile filings, and execution of documents without notary affidavits. Each corporation may be organised in the U.S. style with a President, Secretary and Treasurer, or in the U.K. style with a Managing Director and Corporate Secretary. The Marshall Islands Association Law was recently republished in a new publication, which includes the Business Corporations Act, Partnership and Limited Partnership Act, Unincorporated Associations, and the Limited Liability Company Act.
Share Capital for Corporations
There is no specific minimum capital requirement for international corporations. The standard authorised share capital is 500 shares without par value or a capital with a stated par value up to USD $50,000. The authorised share capital may be expressed in any currency. The minimum issued share capital is either one share of no par value or one share of par value.
The following shares are permitted:
- Bearer shares.
- Preference shares.
- Redeemable shares.
- Shares with or without par value.
- Shares with or without voting rights.
A minimum of one shareholder is required which may be an individual or a body corporate. The details of company Beneficial Owners and Shareholders are not part of the public records.
A Marshall Island corporation requires a minimum of one Director, who can be a physical person or a body corporate. Details of Company Directors do not have to appear on public file and there is no requirement to have resident Directors. A Local Registered Agent is required and is provided upon incorporation at no additional cost.
Restrictions on name and activity
Marshall Islands corporations’ names must end in one of the following words, or their relevant abbreviations:
Corporation, Incorporated, Limited, Public Limited Company, Aktiengesellschaft, Société Anonyme, Sociedad Anónima, Société Anonyme à Responsabilité Limitée, Berhad, Proprietary, Naamloze Vennootschap, Besloten Vennootshcap, Aktiengesellschaft.
Names may be in any language as long as Roman characters are used and any standard corporate suffix is acceptable.
The following words cannot be used in the name of a Marshall Islands corporation: bank, chartered, establishment, foundation, insurance, partnership or trust. Names denoting any connection to local, state or national governments are generally prohibited and the Registrar may require an English translation if a foreign language is used to ensure that the proposed name is not one that is restricted.
Every company, registered in the Marshall Islands is required to have a registered office and address, which should be notified to the Registrar. A Registered Agent is required to ensure that the corporation has an assigned representative at a known address to receive all service of process (legal notices) on its behalf.
A Marshall Islands Corporation must appoint a Company Secretary who may be a natural person or a body corporate. The Company Secretary can be of any nationality and need not be resident in the Marshall Islands.
The Directors and Shareholders meetings need not be held in Marshall Islands; and there is no requirement for an Annual General Meeting. All meetings may be held outside Marshall Islands, by telephone or other electronic means. Alternatively, directors and shareholders may vote by proxy.
The most popular company form used by international investors in the Marshall Islands is a Non-Resident Corporation.
Non-Resident Corporations have certain restrictions:
- Cannot trade within the Marshall Islands.
- Cannot undertake the business of banking, trust services, insurance, assurance or reinsurance and gaming.
As there is no Public Registrar of Companies, there is an extremely high level of privacy for a corporation in the Marshall Islands. Nominee Directors and Shareholders are also accepted to maintain this level of confidentiality. Shadow Directors are permitted within all Companies as Directors are not required to be registered.
The approximate timescale for incorporation is one business day upon submission of all the required documentation to the Registrar. Corporate documents also can be legalised via Apostle within one business day.
The UK Persons of Significant Control Register & its impact on companies
The requirement to maintain a register of people with significant influence or control, more commonly known as the PSC register was introduced to mandate all unlisted companies in the UK, including LLPs and dormant companies to maintain a register identifying those with significant control over a company.
Cyprus implements the Hague Convention, legally recognising Trusts as a type of Equitable Law
This year, the Republic of Cyprus ratified The Hague Conventions’ definition of the legislation applicable to trusts and furthering the regulations surrounding their recognition. Cyprus common law now recognises trusts as a unique legal institution under equity.
SINGAPORE: the regulation of digital currencies & whats to come
The Monetary Authority of Singapore has released its plans to further control and regulate the current elusive virtual currency market and intermediaries that facilitate their online trade in Singapore. The anonymity surrounding so-called crypto currencies such as bitcoin raises questions over potential money laundering & terrorist financing risks.
How to incorporate a company in Cyprus with the required documentation
Cyprus is the perfect location for incorporating an offshore or private company due to its simple incorporation procedures and agreeable tax structure. Below are the steps to company formation, the registration procedure, and all documentation required for incorporation:
ACRA release new initiatives for Singapore Filing Agents
ACRA have released new guidelines introduced to update the current system, bringing it transparently in line with other jurisdictions; going forward, businesses will be offered a copy of their business profile and the amount of information available for public use will increase substantially.
The servicing of documents to a Cyprus company & failure to act
A Creditor may apply to court for the issuance of a liquidation order against a company that does not comply with a demand notice to pay any outstanding debts. The notice of demand is served to the registered office of the company, who then has 21 days to pay the fine; failure to do so may result in the liquidation of the company deemed unable to pay its debts by the creditor who can apply to legally dissolve the company.
Gibraltar companies now have to disclose full Beneficial Ownership details to Central Register
Gibraltar is working to implement all EU legislation relating to the 4th Anti Money Laundering Directive into national law, in addition to the current EU legislation on financial supervision and direct taxation, and to this affect, the Government of Gibraltar have established a Central Register of Beneficial Ownership that will be effective from June 26th 2017.
European Commission publishes tax avoidance disclosure directive
The EC (European Commission) has published its draft legislation compelling financial service providers or intermediaries to disclose any international tax planning schemes they have encouraged, enabled or assisted in any way.