International Business Company

The international business company is commonly referred to as an offshore company, which essentially, is a company that is incorporated and registered in one country but conducts its business outside that country. In terms of asset protection and tax minimization in international business, the international business company is an offshore company that is regulated under a specific tax and business regime.

In this regime, the international business or IBC is not available, that is, cannot be incorporated by local residents of the jurisdiction where the IBC is being incorporated, as offshore company launching, same as Panama companies formation, services are available strictly to non residents.

This said, international business companies are incorporated under special tax conditions, whereby they are not subject to any taxation in the country where they are formed. This tax exempt status is provided and must be maintained on the grounds that an international business company does not trade or provide any of its services in the jurisdiction of formation. In jurisdictions where free zones and other special tax laws are established for international business companies to operate locally, such as manufacturers and exporters, for example, an international business company many b able to operated or be based in the jurisdiction of formation without being liable to any taxation.

International business companies are indentified by different names according to jurisdictions. Hence, in the British Virgin Islands, the BVI international business company is regulated under a comprehensive body of legislation that governs all corporate entities in the BVI and is called the BVI Business Company. In the Cook Islands the international business company is called the International Company; in Panama – the Panama corporation or Panama Non-Resident Company; and in Nevis – the Business Corporation.

While IBC laws provide generally have the same provisions, jurisdictions may want to offer a unique product and as a result may add special features to their offshore companies. This can be reflected in the tax regime established for international business companies such as being able to operate locally and offshore and be taxed on a territorial basis, being able to form international business companies as companies limited by guarantee, limited by shares or by guarantee etcetera for greater flexibility, or being able to transfer from one corporate form to another such as in the case of the Nevis Multiform Foundation which can be set up as a Nevis Business Corporation in the first instance.

The international business company is required to have a board of directors and an authorized share capital. Rules and the statues regulating the company are contained in the constitution (memorandum and articles) which must be enforced and written in accordance with legal requirements. The memorandum and articles of international business companies are normally registered at the Companies Registry as part of the legal procedures for incorporation. It is usually upon being satisfied that an IBC has issued this document that the Registrar of competent authority proceeds to registering the company’s name and assigning an IBC registration number.

The IBC is used for trade and commerce, investment, reducing tax liability and protecting assets. The IBC is a legal person and because of this is separate and distinct person from its shareholders.

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