Marshall
Islands Table of Statutes
This
is a non-exhaustive list of the main
Marshall Islands
statutes affecting offshore and maritime business.
Click on the statute for further information.
Association
Law of the Republic of the Marshall Islands
1990
Maritime Act 1990
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Marshall Islands Corporate Forms
The
Marshall Islands Associations Law, adopted in
1990, is modeled on the corporate laws of the
states of Delaware
and New
York, and was modified
to include all the necessary characteristics
of an offshore jurisdication, such as bearer
shares, facsimile filings, and execution of
documents without notary affidavits.
The
Associations Law includes the Business Corporations
Act, the Revised Partnership Act, the Limited
Partnership Act, and the Limited Liability Company
Act.
There
are no requirements in the
Marshall Islands
for annual returns or filings, and there is
no public register containing the names of directors
or shareholders.
In
1990, The Trust Company of the Marshall Islands,
Inc. and Marshall Islands Maritime & Corporate
Administrators, Inc., affiliates of
US
corporation International Registries, Inc. (IRI),
entered into a legislatively endorsed joint
venture agreement with the Government of the
Republic of the Marshall
Islands to
administer its maritime and corporate programs.
Incorporation
and registration of Marshall
Islands non-resident
(i.e. offshore) companies or partnerships is
carried out through any of the world-wide offices
of International Registries, Inc. A Deputy Registrar
of Corporations is located at each one of IRI's
offices and can issue all necessary corporate
documentation.
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Marshall Islands Limited Liability Companies
In
1996, the Marshall
Islands enacted
a Limited Liability Company (LLC) Act. The
Marshall Islands
law was modeled after the Delaware LLC law in
the United States
. The LLC is a hybrid
business entity which combines the favorable
elements of a corporation and a partnership.
Members are governed by an operating agreement
but have limited liability in the same way as
the shareholders of a corporation. Unlike the
limited partnership, however, where the general
partner remains personally liable in the event
of a business loss, the LLC allows all members
to contribute without risking personal liability.
The
main documents forming and governing a LLC are
the Certificate of Formation, which establishes
the LLC, and the Operating Agreement which defines
the economic organization, management responsibilities
and other arrangements for members (or owners)
of the LLC.
LLC's
formed pursuant to the Marshall Islands LLC
Act must file a certificate of formation setting
forth:
- The
name of the LLC;
- The
name and address of the Registered Agent;
- If
the company is to have a specific date of
dissolution, the latest date on which the
limited liability company may dissolve;
and
- Any
other matters the members determine to include
therein.
Members
in a LLC are not required to participate in
the management of the entity; instead, they
may designate "managers" (who may
or may not be members) to manage the affairs
of the LLC. Members may also actively participate
in management without losing their limited liability.
Flexible management makes a LLC an excellent
vehicle for transactions requiring a considerable
degree of passive investment such as venture
capital projects, investment in real estate,
oil or technology, as well as research and development
of business.
The
LLC may be conveniently employed in the types
of parent-subsidiary arrangements inherent to
large corporations because any type of entity
may be a LLC member. In addition, the names
of members are not disclosed in the certificate
of formation, thereby preserving confidentiality.
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Marshall Islands Corporation
Marshall
Islands non-resident corporations are easy to
form and administer. If standard Articles of
Incorporation are used, a company may be formed
in one day. Legal
and financial professionals may start the incorporation
process for a Marshall Islands Corporation on-line.
Each
corporation may be organized in the
US
style with a President, Secretary and Treasurer,
or in the UK
style with a Managing
Director and Corporate Secretary.
The
Articles of Incorporation may include special
provisions regarding the scope of activities
or the conduct of the affairs of the corporation.
There are also selected optional purpose and
power clauses for attorneys which may be included
in the Articles. The Marshall Islands Business
Corporations Act provides a list of other provisions
affecting corporate activity and administration
which may also be included.
Names
may be in any language as long as Roman characters
are used and any standard corporate suffix is
acceptable. The following words cannot be used
in the name of a Marshall
Islands corporation:
'TRUST', 'BANK', 'INSURANCE'. Terms such as
'Foundation', 'Charity' and others may be used
with the permission of the Registry. Two alternative
names for the corporation should be included
in the event that the first selection is not
available.
There
is no minimum number of directors or shareholders
for Marshall
Islands corporations.
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Marshall Islands Re-Domiciliation
Division
14 of the Marshall Islands Business Corporations
Act permits companies to transfer their domicile
into the Marshall
Islands .
The legal basis for redomiciliation was adapted
from Delaware
law. Upon redomiciliation, the
original date of incorporation and company existence
remains the same and is unaffected. Redomiciliation
is currently free of charge and the company
is not billed its first annual fee until one
year after the redomiciliation date.
The
Business Corporations Act allows a foreign corporation
to redomicile to the Marshall
Islands if
the "transfer of domicile is not expressly
prohibited under the laws of the foreign domicile".
Documentation
required for re-domiciliation is as follows:
-
Signed Articles
of Domestication (obtainable from the
Marshall Islands Registry through International
Registries, Inc. offices);
-
new Marshall
Islands Articles of Incorporation;
-
a photocopy
of the company's Articles of Incorporation
or Articles of Association from the previous
jurisdiction, and any amendments to those
Articles of Incorporation or Articles
of Association; and
-
a document
providing evidence of corporate existence,
such as a Certificate of Good Standing.
It
is also possible to merge a foreign corporations
with either a Marshall
Islands corporation
or a Marshall Islands Limited Liability Company.
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Marshall Islands Partnership and Limited Partnership
A
partnership is formed pursuant to the Marshall
Islands Revised Partnership Act when two or
more persons agree to carry on as co-owners
a business for profit and file a Certificate
of Partnership Existence pursuant to section
29 of the Act. A Certificate of Partnership
Existence includes the following information:
-
The name
of the partnership;
-
The name
and address of the Registered Agent in
the Marshall
Islands
and a statement that the partnership's
Registered Agent is to be its agent upon
whom process against it may be served;
-
A statement
that the partnership will file a Certificate
of Cancellation upon the dissolution and
completion of winding up of the partnership;
and
-
Any other
matter the partnership wishes to list,
including, but not limited to, the names
of the partners authorized to execute
an instrument transferring real property
held in the name of the partnership and
the authority, or limitations on the authority,
of some or all of the partners to enter
into other transactions on behalf of the
partnership.
One
original acknowledged Certificate of Partnership
Existence must be executed by at least one partner
or by one or more authorized persons and submitted
with two duplicate copies. Photocopies are acceptable
as duplicate copies provided the signatures
are legible. Each signature shall be over the
individual's printed name and title and may
be a facsimile.
Limited
partnerships are formed pursuant to the Limited
Partnership Act. In a limited partnership, there
must be at least one general partner with an
unlimited number of limited partners. Limited
partners are protected by limited liability.
A limited partnership must file a Certificate
of Limited Partnership, which includes the following
information:
-
The
name of the partnership;
-
The
name and address of the Registered Agent
in the Marshall
Islands
and a statement that the partnership's
Registered Agent is to be its agent upon
whom process against it may be served;
-
The
name and address of any general partners;
and
-
Any
other matter that the limited partnership
wishes to list
Marshall Islands Foreign Maritime
Entity
Non-Marshall
Islands
entities
may apply for registration as a foreign maritime
entity under the provisions of section 119 of
the Marshall Islands Business Corporations Act
for the purpose of owning and operating vessels
under the Marshall Islands Flag. The following
information must be included in the application:
-
The name
of the entity;
-
The legal
character or nature of the entity;
-
The jurisdiction
and date of its creation;
-
A statement
that the entity has the power to own or
operate a vessel;
-
A statement
that the entity has the capacity to sue
and be sued in its own name;
-
The address
of the principal place of business of
the entity and, if such place is not in
the jurisdiction of the creation of the
entity, either the address of its place
of business or the name and address of
its lawful fiduciary or legal representative
within the jurisdiction of the creation
of the entity;
-
The full
name(s) and address(es) of the person(s)
vested under law with management of the
entity at the time of the application;
-
The name
and address within the Republic of the
entity's Registered Agent and a statement
that the Registered Agent is to be its
agent upon whom process against it may
be served; and
-
The title(s),
or if other than an officer of the entity,
the basis of the authority of the person(s)
executing the document.
Each
application must be accompanied by the following
documentation:
-
A certified
copy of the articles, charter or other
document upon which existence of the entity
is based, issued by the appropriate governmental
agency, and any relevant amendments thereto;
and
-
Evidence
of the entity's current existence either
by a government document (e.g., Certificate
of Good Standing) or if government certificate
is not possible, by certification of an
attorney of the jurisdiction that in his/her
knowledge the entity has a current legal
existence.
Note: All documents in a foreign language
must be translated into English and certified
by a qualified translator.
The
application should be prepared with one original,
signed and acknowledged copy and two duplicate
copies. Photocopies are acceptable as duplicate
copies provided the signatures are legible.
Applications shall be executed by signing above
the printed name and title of the signatory.
Applications
may be acknowledged either before a notary public
or by the person signing the instrument under
penalty of perjury pursuant to section 5 of
the Business Corporations Act.
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