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Bahamas: Types of Company

International Business Company

The International Business Company is the most widely used vehicle for offshore operations in the Bahamas; it normally takes the form of a private company limited by shares. The governing legislation is the International Business Companies Act 1989, updated by the International Business Companies (Amendment) Act 1994, the International Business Companies Act 2001, and the International Business Companies (Amendment) Act 2004.

Until 2001, there was no need to register details of beneficial owners, directors or officers, but under the International Businesses Companies Act 2001 which came into force at the start of 2001 IBCs are required to submit their identities, addresses and names of directors and owners to the Registrar General's Department. Otherwise, statutory requirements are minimal, and flexible:

  • Only one director, who may be corporate, and one shareholder are required; 
  • Shareholders, directors and officers need not be resident in the Bahamas and there is no stipulation as to their nationality; 
  • There is no minimum capital requirement; shares must be registered and may be issued in any currency; bearer shares however are no longer permitted; 
  • Accounts need not be kept; however, if they are kept there is no requirement for an audit. 
  • A share register needs to be kept; it is unclear whether nominee shareholders are still permitted;
  • Shareholders and directors meetings need not be held in the Bahamas and can be held by telephone;
  • The Memorandum and Articles of Association are the only documents to be held on the public record;
  • The legislation contains asset protection clauses against actions emanating from without the Bahamas; it also contains provisions for the protection of minority shareholders;
  • An IBC is exempt from Bahamian Exchange Control, from stamp duty and from other taxes and estate duties for 20 years from the date of incorporation; 
  • an IBC can be managed, controlled and operated from the Bahamas.

A company incorporated or (if foreign) registered under the Companies Act 1992 can switch to IBC status if it qualifies under the legislation.

IBC status is granted subject to certain conditions:

  • No business may be transacted with residents in the Bahamas;
  • No ownership interest in real property in the Bahamas is permitted; property may be leased for office use only;
  • Banking, insurance or re-insurance business is not permitted;
  • Engaging in the business of company management or providing registered facilities for Bahamian incorporated companies is not permitted.

IBCs are permitted to own shares in other Bahamian companies, maintain bank accounts in the jurisdiction and employ the services of local professionals.

It is obligatory to use a registered agent in the Bahamas to incorporate an IBC. Fees for incorporation of an IBC are based on the company's authorised share capital. Normally, the incorporation process takes no more than one day.

Statutory incorporation and annual registration fees are as follows:

Authorised Capital
Incorporation Fee
Annual Fee
Up to BSD50,000
BSD330
BSD350
Over BSD50,000
BSD330
BSD1,000

Amendments to the International Business Company legislation in 2004 permit the continuation of an IBC as a Bahamian company under the Companies Act, and enable an IBC to be licensed as an external insurance company.

 

 

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