Individuals
or companies wanting to make use of the
offshore sector in St Vincent and the Grenadines
normally constitute either or both of an
International Business Company or a Trust.
The International Financial Services Authority
(IFSA) of St Vincent and the Grenadines
announced in May 2004 that offshore agents
would henceforth be able to incorporate
companies for their clients online.
This
development meant that instead of taking
one day to file the relevant documents and
issue company certificates, the IFSA can
now commit to ensuring that company documents
are available for collection within three
hours of the filing of the information by
the agent. The online registry system operated
by the Authority also allows agents to pay
their annual fees over the internet, to
reserve company names, and to conduct searches
of company files. The system is operated
using a pre-payment model.
St.
Vincent and the Grenadines International
Business Company
The International Business Companies Act
No.18 of 1996 and regulations SRO No. 33
of 1996 and their amendments govern the
incorporation of International Business
Companies in St. Vincent and the Grenadines.
Only
a duly approved Registered Agent within
the meaning of the new Registered Agent
& Trustee Licensing Act (No.15), 1996,
may submit applications for formations and
undertake services set out in the Act.
Key
features of the International Business Company
are as follows:
- There
are no requirements for a local director
or any domicile requirements. One-director
companies are allowed, and any director
may be a corporate entity.
- The
publicly filed articles of incorporation
contain a minimum of information including
the name of the company, the Registered
Agent, the currency of the capital and
authorized capital, type of shares.
- Company
names must include a designation or
abbreviation that signifies limited
liability. Foreign denotations such
as “Aktiengesellschaft”, “Anonima”,
“Societe Anonyme” or the abbreviations
such as A/S, SA, AG, GmbH , NV and BV
are allowed. Incorporation under documents
in foreign language is allowed provided
translation is attached.
-
Two types of Incorporation Certificates
are available, namely with or without
the director’s name displayed.
- A
minimum of one shareholder is required
which may be a natural person or a corporation.
There are no requirements with regard
to minimal share capital.
- Details
of the shareholders do not appear on
the public file.
- A
wide range of types of share is permitted,
including registered or bearer shares,
voting shares, non-voting shares, shares
that may have less than one vote per
share, common shares, preferred shares,
limited shares, shares limited by guarantee
or redeemable shares, and shares that
entitle participation only in certain
assets.
- No
list of shareholders has to be submitted.
- Beneficial
owners of shares are not made public.
NB: The International Business Companies
(Amendment) Act No.26 and 44 of 2002
now allows for the registration and
custody of bearer share certificates
by the Registered Agent, who must also
keep a record of each bearer certificate
issued or deposited in its custody and
the record shall contain pertinent information
relating to the company issuing the
shares, the ID number of the share certificate
and identity of the beneficial owner.
-
Company books, share registers, etc.,
may be kept in or outside of St.Vincent.
There are no limitations on where or
how meetings may be held, and there
are no mandatory annual returns.
- Foreign
companies may become IBCs by way of
continuation; and IBCs may migrate to
other domiciles.
-
An IBC receives upon formation a Government
Certificate of Exemption from taxes
for 25 years from the date of incorporation.
- No
annual return or accounts have to be
filed with the SVG authorities thus
allowing for total confidentiality of
financial affairs.
- The
company must maintain a registered office
address within St. Vincent and must
also appoint a local registered agent.
Fees are laid down by the International
Business Companies Amendment Regulations
2003. The total IBC incorporation fee payable
to the government was initially set at $225,
with an annual renewal fee of $100.
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St. Vincent and the
Grenadines Limited Duration Company
The
IBC Act also makes provision for limited
duration companies (pass through companies
known as limited liability companies in
the USA and resembling the German GmbH and
Latin American-style “Limitada”)
with a single member, and provides for the
governance of such entities under private
operating agreements as opposed to by-laws.
A company incorporated under the IBC Act
may at any time apply to the Registrar to
be registered as a limited duration company.
The name of the company needs to include
at its end "Limited Duration Company”
or the abbreviation "LDC”.
The Registrar needs to be provided with
a certified copy of a special resolution
of the company altering its Articles to
limit the duration of the company to a period
of 30 years from the date of its incorporation
or less.
A
limited duration company may by special
resolution alter its Articles extending
the duration of the company to such period
or periods not exceeding in aggregate 100
years from the date of the incorporation
of the company.
The Articles or By-Laws of a limited duration
company may prohibit the transfer of any
share or other interest of a member of the
company absolutely, or may provide that
the transfer of any share or other interest
of a member requires either the unanimous
resolution of all the members or a resolution
passed by such proportion of the members
as the Articles or By-Laws may specify.
The Articles or By-Laws of a limited duration
company may provide that a person ceases
to be a member of the company upon the happening
of any one or more of the events specified
in the Articles, and may further provide
that the rights of such former members shall
be limited to an entitlement to receive
such value for their shares in the company
as may be determined by the Articles or
By-Laws.
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St.
Vincent and the Grenadines Trusts
Trusts
are constituted under the International
Trusts Act 1996, as amended by the International
Trust Amendments Act 2002.
Trust
deeds are registered in a confidential government
Trust Registry, whereupon an official Certificate
of Registration is issued to the Settlor/Grantor.
Key
features of the current trusts regime are
as follows:
-
A
duly registered trust will not be rendered
unenforceable because it was invalid
under the laws of the Settlor/Grantor’s
domicile or residence. Thus, forced
heirship law and community property
regimes can be avoided.
-
The traditional rule against perpetuities
and the rule against accumulations are
modified and clarified in thne current
legislation.
-
Purpose trusts, which are created for
a specific purpose but without named
beneficiaries, are allowed and statutorily
prescribed.
-
The role and duties of protectors are
specifically set out and clarified to
account for recent case law.
-
Choice-of-law and conflicts-of-laws
issues are anticipated and resolved
in favor of the provisions of the International
Trust Act.
-
A foreign (non-Vincentian) judgment
against a registered International Trust
(or its settler or beneficiaries) is
not enforceable in Saint Vincent if
the judgment was based on law inconsistent
with the International Trust Act, 1996.
-
Actions against registered international
trusts must be commenced within two
years from date of creation of the trust.
-
A complaining creditor may satisfy his
claim against the property of a registered
international trust only if that creditor
can show both that the settlor/grantor’s
principal interest in creating the trust
was to defraud him, that the disposition
of property to the trust rendered the
settler/grantor insolvent.
-
Traditional fraudulent conveyance laws
(Statute of Elizabeth) are not applicable
to registered international trusts.
-
The bankruptcy or insolvency of the
settler/grantor under the laws of his
residence or domicile will not affect
a registered international trust.
-
An international trust may own one or
more Saint Vincent International Business
Companies.
-
Registered trustees fall within the
definition of ‘financial institutions’
of the Proceeds of Crime Money Laundering
Prevention Act 2001 and are thereby
subject to its anti money laundering
requirements.
The
registration fee for a trust was initially
set at US$300, and the annual fee at US$150.
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