AmPlus Business Services Limited |
Hong Kong Company Formation / Offshore Bank Account Opening |
Offshore Company Formation Overview
An offshore company is generally defined as:
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A company which is incorporated outside the jurisdiction of its primary operations (sometimes known as a non-resident company) or, |
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Any company (resident or otherwise) incorporated in an Offshore Financial Centre (or OFC).
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An OFC is usually a small, low-tax jurisdiction specializing in providing corporate and commercial services to non-resident offshore companies, and for the investment of offshore funds.
The governments of many countries actively seek international investment and trade to stimulate their own economies. The OFC has developed as a result of this straightforward objective. Many of these countries are known as tax havens.
Traditionally, tax havens are free from foreign exchange controls and have introduced specific legislation and corporate structures, designed exclusively for international business and foreign investment. An International Business Company, (or an IBC), is the most widely used corporate vehicle in this regard with the widest variety of applications.
An IBC is an offshore company formed under the laws of some jurisdictions as untaxed company which is not permitted to engage in business within the jurisdiction in which it is incorporated. OFCs that have allowed the formation of IBCs include the British Virgin Islands, the Bahamas, Samoa and Seychelles.
Characteristics of an IBC vary by jurisdiction, but will usually include:
- Low or zero taxation and stamp duty, provided the company engages in no local business
- High degree of confidentiality of the beneficial owner of the company
- Wide corporate powers to engage in different businesses and activities
- Simple company director and officer requirements
- Lesser reporting requirements
- Simple and inexpensive company administration