Company Report : International Business Company
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Asset protection
Anonymous banking
Cyprus

Introduction

The Seychelles IBC – an International Business Company – is the most popular offshore corporation available in Seychelles. Seychelles IBC is similar to other popular international business company, like the BVI IBC, and in some respects even exceeds the benchmark model of offshore corporation. Seychelles operates one of the fastest IBC Registers in the world. Efficient systems and highly motivated individuals facilitate the swift engagement of this dynamic legal vehicle. Same-day incorporation and efficient business operators. The registration process in Seychelles is simple and straightforward.

At the end of 2004 there were more than 17,000 International Business Companies in the Seychelles. By 2008 the number of IBCs on the register had surpassed 50,000, making the Seychelles one of the fastest growing offshore centres in the world, with more than 600 new offshore companies being registered every month.

The formation, tax benefits and general structure of a Seychelles IBC is regulated by the Seychelles International Business Companies Act 1994. A full text of the Seychelles IBC Act 1994 is available from our Country Information pages.

A Seychelles IBC is, by definition of the law, not subject to any tax or duty on income or profits. It is also exempt from stamp duties on transfer of property and any exchange controls. Essentially, a Seychelles IBC is a completely tax-free corporation, insofar as it complies with a few simple rules of operation. The law provides that all exemptions for a Seychelles IBC shall remain in force for a period of twenty years from the date of formation of an IBC.

IBC status is granted subject to certain conditions: no business may be transacted with residents of the Seychelles. No ownership interest in real property in the Seychelles is permitted; property may be leased for office use only. Banking or trust business may be carried on only if an appropriate license is issued. Likewise, a licence is required to carry on insurance or re-insurance business. Engaging in the business of company management or providing registered facilities for Seychelles-incorporated companies is not permitted. IBCs are permitted various activities within the Seychelles without compromising their offshore status under the Act; these include: professional contacts with lawyers, accountants etc., preparation and maintenance of books and records. The holding of directors’ or shareholders’ meetings, ownership of shares in other Seychelles companies, whether under the Act or the 1942 Companies Law. Ownership of Government or Central Bank securities, ownership of a vessel registered in Seychelles.

Seychelles has a “territorial” tax system meaning that Seychelles residents are only taxed on their locally sourced income. Therefore, there is no advantage to non-residents over residents and claims of “ring fencing” have no merit on the Seychelles IBC. This has been, and continues to be, used successfully by Seychelles in defense of the Seychelles IBC versus international bodies such as the OECD and FATF. Boosting the defense even more is the fact that there are no restrictions on a Seychelles IBC owning shares of a Seychelles domestic company.

Following is a report of the most important advantages and features of the Seychelles International Business Company.

Regulation


The International Business Companies Act 1994 governs the operations of offshore companies.
The incorporation documents need to be filed by a licensed Registered Agent, after which the Registrar will perform the incorporation.
Foreign companies can re-establish themselves in the Seychelles by way of continuation without the necessity for reciprocal arrangements in the original country of incorporation. An IBC can also easily leave from Seychelles if it desires.
In 1996, the Seychelles authorities adopted the Anti-Money Laundering Act which
addresses, inter alia, the criminalization of money laundering, and the forfeiture of the
proceeds of crime, special police powers and suspicious transaction reporting. It also
empowers the Central Bank to determine identification and report keeping procedures for
financial institutions. The obligation to file suspicious transaction reports extends to a
broad range of entities such as banks, foreign exchange bureaus, insurance companies,
investment businesses and casinos. In addition to the AML Act, the Central Bank issued a
set of “Guidance Notes on Anti-Money Laundering Procedures for Financial Institutions in Seychelles “in March 1998.

IBC Status

A Seychelles IBC, by the definition of the law, is not subject to any tax or duty on income or profits. A shareholder of a Seychelles IBC is also not subject to any tax on his income derived from the IBC. These provisions are enshrined into Article 109.(1) of the Seychelles IBC Act, stated as follows:

109.(1) A company incorporated under this Act or a shareholder thereof shall not be subject to any tax or duty on income or profits accruing to or deriving from such company or in connection with any transaction to which that company or shareholder, as the case may be, is a party.

In a similar fashion, a Seychelles IBC is also also exempt from any stamp duties on all transactions relating to its business, in particular on any transfers of property to or by the company, and on any transactions in respect of the shares, debt obligations or other securities of the IBC.

Essentially, a Seychelles IBC is a completely tax-free offshore corporation, insofar as it complies with a few simple rules of operation. The main requirement is that a Seychelles IBC should not pursue business within the territory of the Seychelles (except, of course, it may enter into business with any other Seychelles IBC`s). The law provides that all exemptions for a Seychelles IBC shall remain in force for a period of twenty years from the date of incorporation of the IBC.

In order to qualify as an IBC, a Seychelles company must satisfy the following criteria:
1. It may not carry on business in Seychelles.
2. It may not own real estate in Seychelles.
3. It may not do banking, insurance and registered agent business without special license.
However, a Seychelles IBC may still engage into any of the following:
1. It may maintain Seychelles-based bank accounts and deposits.
2. It may maintain books and records within Seychelles.
3. A Seychelles IBC may maintain professional relationship in Seychelles with attorneys, accountants, trust and management companies, investment advisers or other similar persons.
4. It may hold meetings of its directors in Seychelles.
5. It may lease a property in Seychelles to use as office from which to communicate with members and where books and records can be kept.
6. It may hold shares, debt obligations or other securities in another Seychelles IBC or in a Seychelles domestic company.
7. A Seychelles IBC may also own a vessel or and aircraft registered in Seychelles.
8. Shares in a Seychelles IBC may also be held by a person resident in Seychelles.

Incorporation of the Seychelles IBC

Choosing a name

The company name must be officially approved by the Registrar of Companies. On applying to the Registrar for the approval of a name, it is recommended that two or three possible names ending with the word “limited” be submitted as this may avoid unnecessary delays. Applicants should however, bear in mind that a name is not likely to be approved if:
1. it is similar to the name of an existing company
2. it is considered misleading or confusing

The “restricted names” for a Seychelles IBC are those that contain the words “Assurance”, “Bank”, “Building Society”, “Chamber of Commerce”, “Chartered, “Cooperative”, “Imperial”, Insurance”, “Municipal”, “Trust”, “Foundation”, or a word conveying a similar meaning, or any other word that, in the opinion of the Registrar, suggests or is calculated to suggest the patronage of or any connection with Seychelles or the Government of Seychelles or with any other country or the Government of that country. The Registrar may permit the incorporation of a company under a name that includes the word “Seychelles” if the Registrar thinks there is a good reason for doing so.

The Registrar may also refuse the registration of any particular name if, in the opinion of the Registrar, such name is indecent, offensive or, in the opinion of the Registrar is otherwise objectionable or misleading. The Registrar may permit the incorporation of a company under a name that includes the word “Seychelles” if the Registrar thinks there is a good reason for doing so.

The name of a limited company, shall end with a word or abbreviation denoting a corporate body or limited liability. The most popular name-endings include any of words like “Limited”, “Corporation” or “Incorporated”; the words “Societe Anonyme” or “Sociedad Anonima”; the abbreviation “Ltd”, “Corp”, “Inc”, “GmbH”, “AG”, “OY” or “S.A.”; or several other word or words, or abbreviations thereof. The actual choice of available corporate endings of the name of a Seychelles IBC is very wide, including abbreviations in many European languages. The full list of those endings and abbreviations can be found in Part III, Section 11(1) of the Seychelles International Business Companies Act

Company requirements
A Seychelles IBC is required by law to have a Registered Agent (RA) in Seychelles, which must hold a current licence to provide international corporate services from the Seychelles International Business Authority. All documents relating to the IBC must be filed with the Registry by its RA.
• The minimum number of directors and one shareholders required are one; a director may be a natural person or a body corporate;
• There is no requirement to appoint a Company Secretary but it is the practice to do so,
• Shareholders, directors and officers need not be resident in the Seychelles and there is no stipulation as to their nationality;
• There is no minimum capital requirement but IBC’s are normally incorporated with an authorized share capital of US$ 5,000 of no par value which is the maximum for the minimum licence fee;
• Shareholders and directors meetings need not be held in the Seychelles and can be held by telephone;

Required documents

For a company to be registered, the following documents and information must be filed with the Registrar of Companies:
(a) The Memorandum and Articles of Association. The Memorandum must state, among other things, the following:
• The name of the company;
• The situation of the registered office;
• The amount of the share capital and details of the shares authorized to be issued, and
• The subscribers to the memorandum together with the number of shares for which they have subscribed.
(b) The Articles of Association which generally govern the company’s internal procedures and functions. The articles contain rules governing the internal management of the company and regulating the rights of its members among themselves.
The articles deal with matters such as:
• General meetings of the company;
• Voting rights of members;
• Transfer of shares;
• Appointment and powers of directors;
• Dividends;
The following documents are necessary for due diligence purposes: a bank reference letter, a certified copy of the passport and a copy of the utility bill showing current residential address.
Incorporation time and procedure

After preparation of the Memorandum and Articles of Association. and other mandatory documents required to register the Seychelles IBC, the documents will be filed to the Registrar of Companies.
It takes approximately 24 hours to incorporate the company. Additional certification (Notary and Apostille) may take another 2 to 4 business days.
Compliance
General

For the incorporation of a Seychelles IBC it´s necessary to use a registered office in Seychelles, which can be provided by the registered agent.
The registered office is used for communications with the local government. All government related mail, will be send to the registered office in Seychelles.
It is advised to appoint a secretary who is present at the registered office, so all requirements and responsibilities can be easily fulfilled.

Board members

The shareholders of the Seychelles IBC need to appoint at least one director at the time of incorporation. Corporate bodies can be appointed as board member without restrictions.
Apart from the director, the company does not have to appoint any other officers.
Share Capital

A Seychelles IBC is not required to have any minimum paid-up capital in order to start its business. Any amount of authorized capital can be stated in the offshore company formation documents, as required by the owners. (Authorized capital is a notional amount of capital that the company is allowed to draw from its shareholders in consideration for the company shares.) The amount of the authorized capital can be freely determined at incorporation by the owners of the IBC and there are no mandatory timeframes as to when such capital must be paid up by the shareholders. All in all, the capital structure of a Seychelles IBC can be extremely flexible and can accommodate all variety of business circumstances and needs.

Initially, maximum authorised share capital was US$ 5,000; currently, with the new amendment to the IBC Act, maximum authorised capital is US$100,000. The minimum issued capital is one share of par or no par value. The permitted classes of shares are:

• Registered shares
• bearer shares
• shares of no par value
• preference shares
• redeemable shares
• and shares with or without voting rights •
Administration
Seychelles International Business Companies are not required prepare of file any financial accounts. The IBC is free to arrange its accounts in any manner that is most fit for the company owners, so as to enable them to establish the financial position of the Company with reasonable accuracy.
Taxation of the company

General
Seychelles IBC is exempt from local taxation, only a annual license fee is paid to the Registrar.
Privacy
Confidentiality is one of the key features of the Seychelles International Business Company as details of the company beneficial owners, directors and shareholders are NOT part of public record. At registration of a new IBC, the Registrar of Companies does not require any data whatsoever on who is the actual beneficial owner of the new company. This information is only known to the licensed Registered Agent of the company and is kept in complete confidentiality. The internal corporate files of the IBC, like the Register of Members, Register of Directors and all Minutes and Resolutions, are kept at the offices of the Registered Agent and are also confidential.

The only documents of a Seychelles IBC that are held on public record are the Memorandum of Association and the Articles of Association. These documents do not contain any indication as to the actual shareholders or the beneficial owners of the company.

The Republic of Seychelles is an independent country. As such, it is not sharing or reporting information to any overseas “principal”, or organization. Seychelles is not subject to the EU Savings Tax Directive, unlike some other offshore tax havens related to the EU member states (primarily, to the UK and its overseas territories).

Seychelles has avoided entering any information-sharing agreements with foreign countries or organizations for exchange of financial aid. Client confidentiality is robustly enshrined in the Seychelles corporate and business legislation. Offshore financial services sector contributes significantly to the country`s GDP. There is an inherent interest with the government and with the general public to maintain and develop the country`s status as a competitive offshore financial centre.
Operating from a Seychelles IBC
Although trading activities cannot take place in Seychelles, the Seychelles IBC offers many possibilities for (international) trading companies, e-commerce, consultants, investors, and many more. While using your registered office in the Seychelles, if desired with professional management services, and a virtual office, it’s possible to undertake worldwide activities without being tax liable or having to deal with bureaucratic matters.
For more information about the possibilities of the Seychelles IBC please contact us.

Summary main characteristics of the Seychelles IBC

Factor
Description
Income and business tax in Seychelles
None
Conduct business internationally
Yes, non residents company taxfree
Conduct business within Cyprus
Yes, 10% taxes
Official language / language of documents
Greek
Minimum paid-up capital
1000
Optimum amount of authorized capital
No limitation
Government license fee
CYP 100
Bearer shares
Allowed
Minimum number of directors
One
Minimum number of Members (shareholders)
One
Non-resident directors
Allowed
Corporate directors
Allowed
Registered Agent and Address in Cyprus
Required
Register of Directors
To be kept by the Registered Agent, and filed at registrar
Register of Members
To be kept by the Registered Agent
Register of Members filed for public record
No
Disclosure of beneficial owners to Registrar
Yes
Disclosure of beneficial owners to Registered Agent
Yes (confidential due diligence)
Holding of Annual General Meeting
Required
Convention of Meetings of Directors / Members
In Cyprus
Corporate Minutes and Resolutions
To be kept by the Registered Agent
Corporate Seal
Required
Keeping of accounts
Not required
Auditing of accounts
Required
Filing of accounts
Required
Access to double-tax avoidance treaties
Available
Subject to currency controls / restrictions
No
Redomicile a foreign company into Seychelles
Yes
Redomicile a Cyprus company abroad
Yes
Net time to incorporate
1-2 business days
Ready-made (shelf) companies
Available

SIBA
Formed in 1995, the Seychelles International Business Authority (SIBA), is in the Seychelles’ capital. SIBA is a body corporate with board members being prominent persons of both government and the private sector.
SIBA is essentially a one-stop shop, licensing and regulating primary offshore activities. It is the company Registrar for International Business Companies and trusts and regulates International Trade Zone activities. The result is that certificates of incorporation may be issued within an hour, ensuring that SIBA is one of the fastest company Registrars in the world.