ANTIGUA

Antigua and Barbuda are islands located east-southeast of Puerto Rico between the Caribbean Sea and the North Atlantic Ocean. The Siboney were the first to inhabit the islands in 2400 B.C., but Arawak Indians populated the islands when Columbus landed on his second voyage in 1493. Early settlements by the Spanish and French were succeeded by the English who formed a colony in 1667. The islands became an independent state within the British Commonwealth of Nations in 1981.

 

Antigua is a popular jurisdiction for obtaining a banking license due to the availability of an unrestricted license at relatively low cost. There is a US$ 5 million paid-in capital requirement. However, there are no requirements regarding capital reserves. Moreover, no loan ratios are imposed and no physical presence on the island is needed which cannot be provided by a management company. Accordingly, Antigua offers the ability to obtain an unrestricted license (except for a prohibition on doing business with residents of the Caricom area) without the considerable costs associated with most other competitive jurisdictions. Antigua's capital requirement is higher than that of some Pacific islands. However, Antigua is one of the few places where an unrestricted license is available with relative ease. A banking license can, generally, be issued within four weeks of submission of completed application documents.

BELIZE

Belize was the site of several Mayan city states until their decline at the end of the first millennium A.D. The British and Spanish disputed the region in the 17th and 18th centuries; it formally became the colony of British Honduras in 1854. Belize was granted fill independence of September 21, 1981.

 

Belize is an attractive jurisdiction for both tax-advantaged incorporation and banking activities. An international business corporation (IBC) may be formed in Belize with a minimum of US$50,000.00 authorized share capital. The IBC need have only one shareholder (which may be corporate) and one director. Bearer shares are allowed. The identities of beneficial owners are not part of the public record. Shares may be issued without par value. No accounting or audit records are required to be filed or maintained in Belize.

 

Banking in Belize is governed by the Offshore Banking Act of 1996. Belize offers two types of offshore banking licenses. A Class A license requires a minimum capitalization of US$3,000,000.00. Class A banks must maintain a resident office. These banks may engage in foreign banking transactions through the resident office without restriction. However, the bank may not transact business with any resident of Belize. The requirements for a Class B bank are similar, although the Class B institution may not solicit deposits from the general public or provide current deposit or checking facilities in connection with the transaction of offshore business. A Class B license requires a minimum capitalization of US$1,000,000.00.

BERMUDA

Bermuda was first settled in 1609 by shipwrecked English colonists headed for Virginia. Tourism to the island to escape North American winters first developed in Victorian times. Tourism continues to be important to the island's economy, although international business has overtaken it in recent years. Bermuda has developed into a highly successful offshore financial center. Bermuda is one of the most popular jurisdictions for insurance activities and the principal domicile of captive insurance companies. Bermuda is also a world leader in reinsurance markets. For the past thirty years, major reinsurers have been relocating their operations to Bermuda from more traditional markets, such as London, due in large part to low taxes and lighter regulation. In recent years, two major British insurers and Lloyd's mainstays, Hiscox PLC and Omega Underwriting PLC, announced plans to move their headquarters to Bermuda.

 

Bermuda insurance companies offer significant advantages with regard to tax regulation and estate planning. Many countries offer benefits for the owners and beneficiaries of insurance policies. Premiums may be deductible for tax purposes. In some cases, insurance policies may be used wrap investment products thereby expanding the tax deductibility of premiums paid which can include dividends, capital gains, and total investment return. Another major advantage is the deductibility or exclusion from estate taxes when benefits are paid. Additionally, these insurance products may be used by residents of certain jurisdictions to avoid the forced heirship regulations of their home countries.

 

Bermuda insurance policies also offer policyholders and beneficiaries an added layer of financial privacy and confidentiality. Many jurisdictions require disclosure of the existence of any foreign financial account or interest in a foreign trust. However, most of these jurisdictions do not view insurance policies as financial assets, but as contractually based agreements between the individual and the insurance company. Accordingly, policies are generally exempt from disclosure. An appropriate insurance policy can give the policyholder additional confidentiality and privacy through a 'Private Act' confidentiality clause. Bermuda law requires insurance companies to withhold all information relating to any policyholder or policy. All disputes over disclosure will be physically adjudicated in Bermuda under Bermuda law.

CAYMAN ISLANDS

The Cayman Islands are a British dependency comprised of three islands (Grand Cayman, Cayman Brac, and Little Cayman) located 240 km south of Cuba. The Islands are the fifth largest financial center in the world, due in large part to the lack of direct taxation. As of 2005, more than 70,000 companies were registered in the Cayman Islands, including more than 430 banks and trust companies, 720 captive insurance firms, and 7000 funds. Banking assets in the Islands exceed USD 500 billion. The Cayman Island Stock Exchange opened in 1997.

 

In recent years, the Cayman Islands have become a hugely popular jurisdiction for managing hedge funds. Approximately eighty percent of the world's hedge funds are based here. Most managers find that the high quality of administration in the Cayman Islands convinces them to locate administration in this jurisdiction. The Cayman Islands provide an environment of flexible legislation coupled with a pool of highly capable professionals familiar with the set-up and administration of funds thereby providing mangers with an exceptional ability to perform in all types of markets.

 

Cayman Island companies have become increasingly popular vehicles for taking companies public in various world markets. For example, many companies doing business in China use a corporate structure which includes companies formed in the Cayman Islands. Many Chinese companies listed on U.S. markets (including China Medical Technologies, Suntech Power, and Focus Media) are actually Cayman Island companies. By structuring their operations in the Cayman Islands, companies gain a flexible exit strategy (either by initial public offering or acquisition), the possibility of reducing taxes, and reducing the impact of currency exchange controls.

 

The Cayman Islands are recognized throughout the global community as a sophisticated, mature, and diverse financial center. Accordingly, Cayman companies are the preferred structure for many multinational businesses.

COOK ISLANDS

Named after Captain Cook, who sighted them in 1770, the islands became a British protectorate in 1888. By 1900, administrative control was transferred to New Zealand; in 1965 residents chose self-government in free association with New Zealand. In recent years, the Cook Islands have developed into an offshore financial center - particularly with regard to trust law. Cook Islands trusts are governed by the International Trusts Act of 1984.

 

International Trusts must have non-resident beneficiaries and, in most cases, a resident licensed trustee. If a settlor appoints a licensed resident trustee as custodian, the settlor may then appoint a managing trustee in his or her own jurisdiction. It is possible to re-domicile an existing trust in the Cook Islands if the trust appoints a licensed local trustee. Cook Islands trust law does not recognize a rule against accumulation or rule against perpetuities. Accordingly, an international trust may accumulate income and assets indefinitely. An International Trust deed may contain a choice of laws provision whereby different aspects of the trust may be governed by laws of different jurisdictions. A change in the governing law may also be triggered upon the occurrence of a specified event (also known as a 'flee clause').

 

In addition to trust management, the Cook Islands are also a popular jurisdiction for banking, insurance, and incorporation. Offshore companies can be established under the International Companies Act (ICA). Shares in an International Company are not required to have a par value and may be denominated in multiple currencies. The ICA allows companies to issue bearer shares, repurchase shares, distribute profits to non-shareholders, and re-domicile in and out of the Cook Islands. The ICA permits company formation with a single shareholder. Only one director is needed and is not required to be a resident of the Cook Islands. However, the company must have a resident secretary who is an officer of a licensed trust company. Offshore entities are not taxed by the Cook Islands, thereby ensuring tax neutrality. Furthermore, there are no reporting requirements for offshore entities.

DOMINICA

The Commonwealth of Dominica is a Caribbean island between the Caribbean Sea and the North Atlantic Ocean, about one-half of the way from Puerto Rico to Trinidad and Tobago. It was the last of the Caribbean islands to be colonized by Europeans due chiefly to the fierce resistance of the native Caribs. France ceded possession to Great Britain in 1763, which made the island a colony in 1805. Dominica gained independence in 1978.

 

In 1996, Dominica codified the International Business Companies Act. This law combines flexible company structures with efficient incorporation procedures. Dominica is one of the most highly competitive and cost-effective jurisdictions for incorporation. The island is a stable democracy and, as a former British colony, has a legal system based on English Common Law.

 

International Business Corporations (IBCs) are exempt from all tax for a minimum of 20 years. To maintain tax-exempt status, the IBC may not do business with residents of Dominica, own real property in Dominica, provide registered offices in Dominica, or carry on banking or insurance activities without the appropriate license. There is no minimum capital requirement. An IBC can be established with only one director and one shareholder who may be the same person. A director is not required to be a shareholder. Shares may be issued in bearer form and do not require a par value.

 

The IBC Act requires complete confidentiality and provides for civil and criminal penalties for any disclosure of information. Transactions of a Dominica company can only be disclosed when its principal is found guilty of a criminal offense in his or her country of residence and that the principal would have been criminally liable for the same conduct had it been undertaken in Dominica. There is no requirement to disclose the beneficial owner of an IBC to the government of Dominica. Note that the jurisdiction in which the beneficial owner resides may have its own reporting requirements (e.g. United States.)

GERMANY

As Europe's largest economy and second most populous nation (after Russia), Germany is a key member of the continent's economic, political, and defense organizations. The decline of the USSR and the end of the Cold War allowed for German unification in 1990. In January 1999, Germany and 10 other EU countries introduced a common European exchange currency, the euro. Today, the German economy is the fifth largest economy in the world in terms of purchasing power parity.

 

Trailing only the New York Stock Exchange (NYSE) and NASDAQ, the Frankfurt Stock Exchange is the world’s third-largest trading center for securities. It is the largest of Germany’s seven stock exchanges. The Frankfurt Stock Exchange is an entity governed by public law and operated by Deutsche Börse AG. This exchange is considered the gateway to the European market for public and private companies in the United States and elsewhere.

 

Companies currently listed on other exchanges are often able to obtain a listing in as little as three weeks from submission of the listing package. Germany’s Frankfurt Stock Exchange is uniquely suited to meet and facilitate cutting-edge trading technology such as settlement and information systems and advanced electronic trading. Its electronic trading platform, XETRA, is widely recognized as the most efficient and flexible trading platform in the world. Having your company listed in Frankfurt allows it to take advantage of exposure to millions of European investors in the continent’s premier international trading center.

 

A few of the benefits of listing your company on the Frankfurt Stock Exchange include:

 

• Enhanced recognition and visibility with European investors and consumers

• Recognized status as a global business entity

• A large and sophisticated market to raise debt or equity

• Improved shareholder relations and prestige

• Economical ongoing transparency requirements

 

 

Click here for a comprehensive guide to listing at the Frankfurt Stock Exchange.

HONG KONG

Occupied by the UK in 1841, Hong Kong was formally ceded by China the following year; various adjacent lands were added later in the 19th century. Pursuant to an agreement signed by China and the UK on 19 December 1984, Hong Kong became the Hong Kong Special Administrative Region (SAR) of China on 1 July 1997. In this agreement, China has promised that, under its 'one country, two systems' formula, China's socialist economic system will not be imposed on Hong Kong and that Hong Kong will enjoy a high degree of autonomy in all matters except foreign and defense affairs for the next 50 years.

 

Hong Kong is an extremely attractive jurisdiction for investment. It is one of the world's largest securities markets, and the most liquid international market for companies in mainland China. Additionally, many types of investment returns are free of tax. Hong Kong imposes no withholding tax, sales, tax, capitals gains tax, new worth tax, or VAT. Parent companies may receive dividends from subsidiaries free of any tax on profit. Rental income from foreign real estate is exempt from profit tax. The individual employment income tax rate is 16% but there is no tax on investment income or capital gains.

 

In addition to having a well developed and sophisticated securities market, Hong Kong is home to one of the world's largest concentrations of international banks. The Hong Kong Banking Ordinance provides the legal framework for banking oversight.. A local bank license requires paid-in capital of HK$300 million. Banks incorporated overseas may operate their local operations as subsidiaries provided that the local institutions have been licensed in Hong Kong for at least three years. Additionally, customer deposits and assets to be transferred to the subsidiary must total at least HK$3 billion and HK$4 billion respectively.

 

Hong Kong companies are incorporated under the Hong Kong Companies Ordinance. Companies may have only one director who is not required to be a resident of Hong Kong. Share capital may be denominated in multiple currencies. There is no minimum share capital requirement. Two or more shareholders are required and separate share classes are permitted. Each company must have a resident secretary and a registered Hong Kong office. General meetings must be held every 18 months. Annual audits must be performed by a qualified independent auditor. Foreign companies wishing to do business in Hong Kong may register as an 'Oversea Company' under Part XI of the Companies Ordinance.

LIECHTENSTEIN

The Principality of Liechtenstein was established within the Holy Roman Empire in 1719. It became a sovereign state in 1806. Until the end of World War I, it was closely tied to Austria, but the economic devastation caused by that conflict forced Liechtenstein to enter into a customs and monetary union with Switzerland. Since World War II (in which Liechtenstein remained neutral), the country's low taxes have spurred outstanding economic growth. Like Switzerland, the Principality of Liechtenstein is politically neutral. It is closely tied to Switzerland with which it shares a currency. Banking and financial services comprise a large portion of the economy. Liechtenstein is an attractive international business center due to its combination of low taxation, liberal corporate statutes, and banking confidentiality.

 

Unlike its European neighbors, Liechtenstein is the only civil law country on the continent with a law on registered trusts. While Liechtenstein's trust law is based on Anglo-American jurisprudence, there are some characteristics unique to trusts established in the Principality. Most notably, Liechtenstein does not recognize rules against accumulations or perpetuities. Accordingly, it is possible to establish a perpetual trust. Liechtenstein does recognize choice of laws provisions allowing a trust to be administered according to the laws of another jurisdiction, such as that of the settlor's domicile. Regardless of which country's law applies to administration, the trust still enjoys the tax advantages of Liechtenstein domicile.

 

One of the most popular entities for wealth management is the Liechtenstein foundation (Stiftung). Although the foundation is not suitable for commercial purposes, it is a very effective tool for managing a family fortune or for charitable purposes. Liechtenstein foundations are not subject to any tax including income tax, capital gains, transfer tax, or estate tax in Liechtenstein. Liechtenstein foundations cost approximately USD 25,000 to establish and about USD 10,000 per year to maintain.

 

In addition to its attractive laws concerning trusts and foundations, Liechtenstein's corporate laws are extremely flexible. The principality allows for the creation of any form of legal organization that is recognized under the law of any jurisdiction worldwide. Common Liechtenstein companies include corporations (Aktiengesellschaft), private limited companies (Gesellschaft mit beschränkter Haftung), and establishments (Anstalt). The Anstalt is the preferred entity used by foreign companies to hold international subsidiaries. It is a hybrid between an AG and Foundation. It has no members or shareholders and may conduct most business activities with the notable exception of trading securities, which requires a special license.

MALTA

Malta is located south of Sicily in the Mediterranean Sea. Great Britain formally acquired possession of the islands in 1814. Malta staunchly supported the UK through both World Wars and remained in the Commonwealth when it became independent in 1964. A decade later Malta became a republic. Since about the mid-1980s, the island has transformed itself into a freight transshipment point, a financial center, and a tourist destination. Malta became an EU member in May 2004.

 

Malta is an attractive jurisdiction for incorporation, particularly with regard to holding companies. An International Holding Company (IHC) is formed with the purpose of owning and managing overseas assets including equities, real estate, and intellectual property rights, as well as any income associated with these assets. The standard corporate tax rate is 35%. However, double taxation agreements and provisions for tax refunds make Malta very tax-efficient for non-resident shareholders. Foreign shareholders may enjoy an effective tax rate of 0% subject to rules concerning 'qualified participations.' An IHC requires minimum issued share capital of Lm 500 or equivalent in foreign currency, of which 20% must be paid up. Two shareholders and one director are required. Nominee directors are permitted. A resident secretary and corporate address are required. The beneficial owner(s) need not be disclosed if nominees are used. Annual audits and returns must be filed.

 

IHCs are ideal for owning and managing assets. However, an IHC may not engage in trading activities. An organization conducting active trade must incorporate as an International Trading Company (ITC). Similar to an IHC, an ITC is taxed at the corporate rate of 35%, but the effective tax rate for non-resident shareholders may be reduced to an effective rate of 4.17%. Operating requirements are the same for an ITC and for an IHC with few differences. An ITC is only required to have one shareholder (as opposed to two for an IHC). Also, unlike an IHC, an ITC may migrate from Malta to another domicile. Bearer shares are not permitted for an ITC or IHC. Financial confidentiality is governed by the Professional Secrecy Act which mandates a high standard of discretion for all professional practitioners and contains both civil and criminal penalties for violation of the Act.

NETHERLANDS

The Dutch United Provinces declared their independence from Spain in 1579; during the 17th century, they became a leading seafaring and commercial power, with settlements and colonies around the world. After a 20-year French occupation, a Kingdom of the Netherlands was formed in 1815. In 1830 Belgium seceded and formed a separate kingdom. The Netherlands remained neutral in World War I, but suffered invasion and occupation by Germany in World War II. A modern, industrialized nation, the Netherlands is also a large exporter of agricultural products. The country was a founding member of NATO and the EEC (now the EU), and participated in the introduction of the euro in 1999.

 

The Netherlands has a long history of international business activity dating back to the beginning of the 17th century and the formation of the Dutch East India Company (Vereenigde Oostindische Compagnie or VOC in Dutch, literally 'United East Indies Company'). The VOC was the first multinational corporation in the world as well as the first company to issue stock. In recent years, Dutch foundations and holding companies have become increasingly popular due largely to the country's accommodating tax laws. Most notably, the Netherlands does not tax royalties. Accordingly, the country has become a jurisdiction of choice for companies with international income derived from intellectual property. Many of the world's largest multinational corporations, including BHP Billiton, Coca-Cola, Nike, Ikea, Sun Microsystems, and Gucci, have set up Dutch holding companies to take advantage of the favorable tax environment.

 

Advantages of a Dutch Holding Company include:

 

• No withholding tax on dividends in most cases No capital gains on the sale of shares Large tax treaty network
• No withholding tax on EU dividends, sent to the Dutch holding company and sent from the company to the beneficiaries
• Ability to get a 'ruling' from the Dutch tax authorities prior to forming complex international structures
• No foreign currency exchange restrictions Businesfriendly commercial law High degree of credibility due to strict laws designed to prevent abuse
• Moderate costs

In addition to the economic benefits described above, the Netherlands also offers a stable political climate, international attitude, well-trained labor force, and developed infrastructure including the world's second largest seaport (Rotterdam) and a major aviation hub.

NOTE: Some countries, including the United States, have special rules concerning royalties and passive income. Please consult tax counsel in your country of domicile to ensure compliance with domestic regulations.

NEVIS

First settled by the British in 1623, Saint Kitts, Nevis, and Anguilla became an associated state with full internal autonomy in 1967. The island of Anguilla rebelled and was allowed to secede in 1971. Saint Kitts and Nevis achieved independence in 1983. Nevis has substantial autonomy under the constitution. It has an island assembly, a premier, and a deputy general. It may secede from the Federation of St. Kitts and Nevis under certain specified conditions. The Federation is a member of the Commonwealth and has a legal system based on English common law.

 

Nevis offers a wide range of financial services including company formation, fund administration, insurance, banking, and trust services. Nevis is probably best known for its laws concerning limited liability companies (LLC). Nevis has enacted one of the most favorable LLC statutes in the world. The Limited Liability Company Ordinance of 1995 provides protection for assets and offers an alternative to those considering using partnerships or corporations.

An LLC is taxed as a partnership rather than a corporation. Accordingly, corporate taxes may be eliminated by operating as a 'tax neutral' entity. Nevis LLCs are often used by investors in countries such as the United States for asset protection. The LLC may be designated as a 'pass through' entity for tax purposes. As such, tax will only be assessed by the jurisdiction of the beneficial owner's residence.

 

The Nevis LLC offers a simple and efficient vehicle for managing assets while maintaining financial privacy for the beneficial owners. Nevis has strict financial confidentiality laws. Nevis financial institutions are forbidden from disclosing account information absent an order by a court in Nevis. In addition to banking confidentiality, Nevis LLCs provide a substantial level of asset protection. Foreign judgments are not enforceable in Nevis. Consequently, any entity desiring to make a claim against a Nevis LLC must litigate the issue in a Nevisian court. Moreover, anyone attempting to sue a Nevis LLC must first post a $25,000.00 bond. After posting the bond, the potential plaintiff must then submit a legal brief arguing why the lawsuit should be permitted. If the court determines that the suit is unwarranted, it will not be allowed to proceed and the bond will be forfeit. Due to this requirement, frivolous suits are virtually non-existent in Nevis.

 

In addition to the LLC, Nevis also offers International Business Corporations and Asset Protection Trusts. As with the LLC, paid in capital is not required, bearer shares are permitted, there are no reporting or auditing requirements, and the business structures are tax exempt for all income earned outside of Nevis.

PANAMA

Explored and settled by the Spanish in the 16th century, Panama broke with Spain in 1821 and joined a union of Colombia, Venezuela, and Ecuador - named the Republic of Gran Colombia. When the latter dissolved in 1830, Panama remained part of Colombia. With US backing, Panama seceded from Colombia in 1903 and promptly signed a treaty with the US allowing for the construction of a canal and US sovereignty over a strip of land on either side of the structure (the Panama Canal Zone). The Panama Canal was built by the US Army Corps of Engineers between 1904 and 1914. In 1977, an agreement was signed for the complete transfer of the Canal from the US to Panama by the end of the century. Certain portions of the Zone and increasing responsibility over the Canal were turned over in the subsequent decades.

 

Panama is home to thousands of financial institutions and international corporations serving primarily the markets of Central and South America. Corporations are governed by Panama's Commercial Code which is modeled on Delaware corporate law. The legal system is a civil code system similar to many European countries such as Switzerland and Liechtenstein. The national currency is the U.S. dollar. Spanish is the official language and English is widely spoken, particularly within the financial industry.

 

Panama is a desirable jurisdiction for operation of offshore corporations and foundations due to its established banking infrastructure and strict banking and financial secrecy laws. Panama is a well respected international trade and banking center. Privacy and confidentiality are constitutionally protected. Unlike many banking centers in the European Union, Panama does not have mutual legal assistance treaties with other countries.

 

One of Panama's most popular business structures is the foundation. Panama offers both a Private Interest Foundation and a Charitable Public Foundation which operates for charitable purposes only. Private foundations may be established for the benefit of individuals, a family, or a specific social purpose. The rules governing Panamanian foundations are modeled after Liechtenstein law. The Private Interest Foundation is a hybrid between a trust and a corporation. It is a legal entity without owners, has a specific purpose, and a general group of beneficiaries. Foundations can be useful when a person wishes to control a foreign corporation but wishes to avoid ownership in order to simplify reporting requirements, such as those concerning controlled foreign corporations. Rather than owning shares individually or in bearer form, ownership may be transferred to a foundation with a predetermined purpose and anonymous beneficiaries. Foundations are also useful for establishing bank accounts and transferring and receiving funds. It is possible to donate funds to a foundation which later provides educational or other benefits to family members, thereby avoiding multiple gift taxes and onerous reporting requirements.

SAMOA

Samoa is comprised of a group of islands in the South Pacific Ocean, about one-half of the way from Hawaii to New Zealand. The islands were first settled about 3,000 years ago by people migrating eastward from Asia. In 1899, colonial powers including Germany, Britain and the United States signed a treaty by which the territory (then called Western Samoa) was annexed by Germany. The country prospered until Germany's expulsion by New Zealand forces in 1914 at the outbreak of World War One. New Zealand continued to administer the islands as a mandate and then as a trust territory until 1962, when the islands became the first Polynesian nation to reestablish independence in the 20th century. The country dropped the 'Western' from its name in 1997.

 

Samoa is an attractive offshore financial center due to its political and social stability, as well as progressive corporate legislation. Samoa is an independent sovereign state with an established legal system based on English common law. Its financial structure and regulations have been approved by both the OECD and FATF. Samoa is an excellent jurisdiction for companies wishing to conduct banking activities. The banking industry in Samoa is governed by the Offshore Banking Act of 1987. Banking licenses are issued by the Minister of Finance. Licenses are offered through a multi-tiered system. Class A licenses require US$10,000,000.00 in paid up capital. The capital requirement for a Class B license is US$2,000,000.00 or US$250,000.00 depending on the category of license issued.

 

Offshore banks must be registered under the International Companies Act. As such, banks are exempt from any income tax or stamp duty. Similar exemptions apply to bank shareholders and depositors. Licensed banks are exempt from all currency and exchange controls. Banks must submit annually audited accounts to the supervisor of offshore banks. Samoa has some of the strictest confidentiality legislation of any jurisdiction. Samoa is not party to any mutual assistance or information exchange agreements.

SINGAPORE

Singapore was founded as a British trading colony in 1819. It joined the Malaysian Federation in 1963 but separated two years later and became independent. Singapore subsequently became one of the world's most prosperous countries with strong international trading links (its port is one of the world's busiest in terms of tonnage handled) and with per capita GDP equal to that of the leading nations of Western Europe. Today, Singapore retains close ties with the United Kingdom and bases its legal system on English common law. Although the citizens of Singapore are predominantly Chinese, English remains the primary language of commerce and administration.

 

Singapore is one of Asia's most important financial centers. Its concentration of financial institutions and efficient capital markets make it a leader in global finance. Since its abolishment of currency exchange controls in 1978, Singapore has evolved into one of the world's premier banking centers. Indeed, in recent years, substantial capital has moved into Singapore from traditional European banking centers due in large part to new regulatory requirements promulgated by the European Union.

Singapore has some of the lowest tax rates in Asia. The current corporate rate is 26%. However, resident companies are only taxed on income earned within Singapore or remitted to Singapore.

Non-resident companies are only taxed on Singapore source income. Corporate residence is determined by the location of central control and management. Note that companies must be resident to benefit from double taxation treaties. A Singapore corporation requires two directors, both of whom must be individuals (as opposed to corporate entities) and must reside in Singapore. The corporation must have at least two individual shareholders or, alternatively, one corporate shareholder. Bearer shares are not permitted. Accounts must be audited by a qualified resident examiner. General meetings must be held annually and a local company secretary is required.

SWITZERLAND

The Swiss Confederation was founded in 1291 as a defensive alliance among three cantons. In succeeding years, other localities joined the original three. The Swiss Confederation secured its independence from the Holy Roman Empire in 1499. Switzerland's sovereignty and neutrality have long been honored by the major European powers, and the country was not involved in either of the two World Wars. The political and economic integration of Europe over the past half century, as well as Switzerland's role in many UN and international organizations, has strengthened Switzerland's ties with its neighbors. However, the country did not officially become a UN member until 2002. Switzerland remains active in many UN and international organizations, but retains a strong commitment to neutrality.

 

Switzerland has one of the most sophisticated and discreet financial infrastructures in the world. Accordingly, one-third of all internationally invested private wealth is deposited in Swiss institutions. The two largest banks are Credit Suisse and UBS, both of which maintain an extensive network of branches worldwide. Switzerland has approximately 400 other banks ranging in size from multinational institutions to banks serving the needs of a few select clients. Private banking services including portfolio management are typically available to account holders with a USD 500,000 minimum deposit.

 

In addition to its world-class financial institutions, Switzerland is an ideal jurisdiction for incorporation and management of multinational entities. This is due to efficient government administration, highly educated and multilingual workforce, sensible tax system, and high quality of life. Many well known multinational companies have selected Switzerland as their global or regional headquarters including Alcoa, Gillette, Procter & Gamble, eBay Europe, DuPont, Schering-Plough, Cemex, Estee Lauder, and Medtronic International.

ST. VINCENT

St. Vincent and the Grenadines is a Commonwealth nation located between the Caribbean Sea and North Atlantic Ocean, north of Trinidad and Tobago. St. Vincent is a popular jurisdiction for the formation of trusts and international business companies due to its favorable taxation and confidentiality laws as well as the efficiency of the incorporation process. St. Vincent entities can be incorporated in as little as one day. Companies formed in St. Vincent require only one shareholder and director, who may be the same person. There is no requirement for local directors or local corporate meetings. Bearer shares are permitted. Corporations are not taxed on any income earned abroad.

Strict confidentiality is mandated for transactions in St. Vincent by the Confidential Relationships Preservation Act of 1996. The Act is arguably the most restrictive confidentiality law in the world today. It is only one of three jurisdictions with general financial privacy laws. It is the only such jurisdiction that is an independent sovereign nation.

 

St. Vincent is also a premier jurisdiction for securing a Class I international banking license. St. Vincent is a well respected banking jurisdiction that has not had the problems seen by other so-called 'tax havens' of the Caribbean. Proper due diligence is undertaken by the government of all bank license applicants. The application process takes approximately 3 weeks from the submission of all necessary documentation. All St. Vincent banks are monitored by the Eastern Caribbean Central Bank (ECCB). Class I applications require a non-refundable fee of US $1,000.00. Upon approval, Class I banks must maintain a capital fund of not less than US $1,000,000.00 or its equivalent in another currency. Additionally, Class I banks must hold a deposit of $5,000.00 as prescribed by the Offshore Finance Authority.

UNITED KINGDOM

 

As the dominant industrial and maritime power of the 19th century, the United Kingdom of Great Britain and Ireland played a leading role in developing parliamentary democracy and in advancing literature and science.  At its zenith, the British Empire stretched over one-fourth of the earth's surface. The first half of the 20th century saw the UK's strength seriously depleted in two World Wars and the Irish republic withdraw from the union. The second half witnessed the dismantling of the Empire and the UK rebuilding itself into a modern and prosperous European nation. As one of five permanent members of the UN Security Council, a founding member of NATO, and of the Commonwealth, the UK pursues a global approach to foreign policy.

The UK is a leading trading power and financial center.  It is one of the quintet of trillion dollar economies of Western Europe.  Services, particularly banking, insurance, and business services, account by far for the largest proportion of GDP.  The Bank of England periodically coordinates interest rate moves with the European Central Bank, but Britain remains outside the European Economic and Monetary Union (EMU), and opinion polls show a majority of Britons oppose joining the euro.

The UKs position as a global financial hub makes it an attractive place to both live and do business.  The UK does not directly tax foreigners on income derived from outside the United Kingdom.  Additionally, the UK has one of the lowest corporate tax rates in the G7.   The Organisation for Economic Co-Operation and Development (OECD) has recognized the United Kingdom as among countries with the fewest barriers to entrepreneurship, trade, and investment in the world.  

The London Stock Exchange is one of the world’s most vibrant and successful.  The Exchange has had an international focus since its origins in the seventeenth century.  It is the primary center for underwriting and trading Eurobonds and hosts the largest foreign exchange market.  Two-thirds of all international equity underwriting occurs in London.  Accordingly, London is an obvious choice for companies wishing to raise capital in foreign markets.  Listing in London provides access to the world’s largest pool of international investment capital, the most active and liquid secondary market in international equities, dedicated international trading systems, worldwide dissemination of corporate news via the Exchange’s own news service, and the ability to list securities in a range of currencies. 

VANUATU

Vanuatu is comprised of a group of islands in the South Pacific Ocean, about three-quarters of the way from Hawaii to Australia. Vanuatu has been operating as a financial center since 1971. Accordingly, compared to many relatively new offshore jurisdictions, its service providers possess an exceptional level of investment, banking, accounting, and legal expertise. Most providers are members of the Vanuatu Finance Centre Association. Association members may offer advice on investments, business licenses, immigration permits, and local company incorporations.

 

Vanuatu has no tax on income, capital gains, gifts, or estates. Moreover, it has no tax treaties with other countries and, as such, no exchange of information with foreign governments. Vanuatu companies are guaranteed no taxes, duties, or exchange controls for 20 years pursuant to the Vanuatu International Companies Act. Accordingly, Vanuatu is an ideal jurisdiction for international holding companies. Companies operating in various jurisdictions around the world may be funded by loans from the parent company so that the subsidiaries may benefit from tax deductions on interest paid. Many other benefits may be realized by using this structure including tax free retained earnings and interest margins.

 

In addition to its favorable corporate legislation, Vanuatu is a leader in captive insurance. It offers one of the most efficient and stream-lined processes for establishing an offshore captive insurance company. Vanuatu insurance companies may be registered as local, external, or exempted. Most captive insurance companies are registered as 'exempt' in order to avoid taxation. However, exempt companies are forbidden from insuring risks within Vanuatu or soliciting business. Exempt companies must have a resident director, file annual returns, and hold annual meetings. The captive insurer may either underwrite 100% of the risk, or may reinsure, either partially or wholly, through third party underwriters.