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Advice for opening an offshore corporate bank account

Contributed by Caporaso & Partners Law Office
19 November, 2020

The procedure for opening an offshore corporate bank account is increasingly more complicated. The offshore banks will analyze you with a magnifying glass.

This advice for an offshore corporate bank account will be very useful for you, since the banks ask for a lot of information. This has influenced, above all, the pressure of the governments to avoid any strategy for tax engineering. Despite this, if you follow the advice that we are sharing here, you'll have success in your objective of opening an offshore corporate bank account. The first step is to determine where opening a corporate bank account for your offshore company is more convenient. Remember that the bank secret is limited, and anonymous accounts don't exist. Answering this question isn't simple and you have to do your own investigation. In this study, you should keep a series of elements in mind. For example, compare laws in the jurisdictions where these banks are working and analyze the banking sectors in these territories.

I also suggest that you review whether the bank that you are analyzing for opening your offshore account is reliable; if it counts on qualified personnel, if it offers assistance in your language, etc. During your investigation, answers can't be missing, regarding the products and services this bank offers, such as whether it accepts offshore companies and if you can make transactions to any country.

The biggest errors made at the moment of opening an offshore bank account

If you know the most common errors committed when opening an offshore corporate bank account, then you can avoid something similar happening to you. The problems begin with the application form for opening the account. This form offers the bank directors the necessary information about your offshore company. If you make a mistake completing this form or don't give all the requested information, you run the risk of your account request being denied.

These days, banks are legally required to know their clients. This, of course, has been demanded by the financial regulators and the banks, reluctantly, have had to comply with this requirement. A key element that they will always ask you is the origin of your money. If the origin of your patrimony is not clear to them, the banks will most likely refuse to provide you with the service. Be careful of what you affirm because it is possible, they will ask for documentation.

Another question that bankers will focus on is knowing for what objectives you will use the bank account. They will be interested in knowing where your will be going and where they are coming from.. If you don't give a clear answer to these doubts, it's also a probability that they won't accept your application for opening an account.

If you are a politically exposed person, it's probable they won't open an account for you

Another important factor for banks is whether you, as title holder of the offshore company, are a "politically exposed person". This means, whether you are or have been a governmental or high-ranking military official, or the leader of a political party or national business, or if you are a family member of a politically exposed person. In any of these cases, the bank will carry out stricter due diligence verifications before accepting an offshore corporate bank account.

Generally, the bank will attempt to establish the risks it will run by offering services to your offshore company. For this, they will check that the information that you have delivered is true. So, you will always have to offer correct information at the moment of requesting a bank account for your company. If, during the investigation, they discover an "involuntary oversight", you can be certain that they will cancel the process and you won't get your account.

Another problem that can arise is with the countries of origin and destination of the transactions that you will be carrying out with your offshore corporate bank account. Let's suppose that the activities that you carry out with your offshore company seems all right for the bank you feel is most convenient and with the jurisdiction where you are registered. In any case, they will always ask you for the destination and origin of your transactions, because they fear being penalized by correspondent banks.

Beware of countries that the bank considers "at risk"

For example, if you registered your offshore company in Nevis and opened an offshore corporate bank account in Curacao, you couldn't send transactions to countries like China, Cyprus, Andorra, Colombia, Hong Kong, Liechtenstein, Macao, Malta, Monaco, and Russia, Since Curacao's banks have restrictions when sending and receiving money from those nations.

This example shows you that you have to completely clarify your offshore company's details in the bank where you hope to open your account. This way, the banker who responds to you will be better able to orient you.

Remember that it's necessary that you know your customers; make them fill out a KYC form

Its quite probable that offshore banks will occasionally ask you for a list of your customers and suppliers; moreover, they will ask for your curriculum. If it has been well-prepared, you can overcome this without too many complications.

Always remember that banks are interested in having new clients to earn money and you need a corporate bank account so that your offshore company can really function. So then, it's earning – earning for both parts, if all goes well.

A last piece of advice: if you don't have the time to investigate which bank or jurisdiction is better adapted to your needs, look for the support of experts. Yes, it will cost you some money to hire these services, but it will be money well-invested, because then your process of asking and obtaining a corporate bank account will be much quicker.


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