Aged Offshore Shelf Companies

A Quick Start: Incorporate your offshore shelf company to get that new business idea going, now that the funds are available and the right opportunity has presented itself, or to enter a new market,...

How to Choose an Offshore Jurisdiction?

Legislation Legislation for offshore companies in the jurisdiction that you acquire an offshore shelf company should be progressive, modern and thorough. In many jurisdictions, you find that the...

Offshore Shelf Company Incorporation

To purchase an offshore shelf company you are first required to choose a licensed offshore financial service provider through whom offshore shelf company incorporation services are obtained. These...

Offshore Shelf Companies

Offshore shelf companies are incorporated in jurisdictions that offer offshore financial and corporate services. Offshore shelf companies are incorporated in these jurisdictions but are only allowed to trade outside the jurisdiction because of their offshore status. Legislation is therefore passed to regulate the activities that offshore shelf companies can engage in, ensuring that the activities of an offshore shelf companies are lawful and do not breach the laws of the jurisdiction where they were incorporated or of the countries where they operate.

Offshore shelf companies may be made available in a variety of legal frameworks, such as LLC’s (Limited Liability Companies), IBC’s (international business companies) or LLP’s (Limited Liability Partnerships) due to the simple fact that an offshore shelf company is any offshore that has been incorporated and had never been used by its owners and was therefore put up for sale, or might have been incorporated to ‘age’ so that beneficial owner that acquires the company ends up inherits an offshore company that was established for many years.

Offshore shelf companies are owned by shareholders in the case of IBC’s, but an offshore shelf company that is an LLC is owned by its members because of the nature of LLC’s to not have shareholders, but rather members who contribute towards capital. Both these two types of offshore shelf companies, including offshore shelf LLP’s are limited liability companies, and thus limit the liability of the owners to only their share contribution in the company. Capital owned in an offshore company may be in the form of cash, real property, technical skill or any other commodity to which a monetary value can be placed. But this depends on the jurisdiction and the provisions of the respective acts for IBC’s, LLC’s and LLP’s. Other legal provisions that may vary for offshore shelf companies depending on the laws of the offshore jurisdiction include regulations for share capital as per the minimum amount startup capital an offshore shelf company (IBC or LLC) may have, whilst some jurisdictions just simply established standard start up share capitals.

Most offshore laws that regulate offshore shelf companies try their best to be competitive. As a result, certain provisions have the objective of making offshore shelf companies structurally flexible and simple to create. As such, most offshore shelf companies can be registered with a single shareholder and director, who may be the same individual or separate persons, whilst ownership of offshore shelf companies can be in hands of natural or legal persons. Another offshore of private corporation can therefore own an offshore shelf company and be named as both director and shareholder.

Very strict regulations are however established for the use and choice of names, since all offshore shelf companies are required to indicate their status as limited liability companies using words or abbreviations that signify limited liability. Some of these include Limited (Ltd.), Aktien Gesellschaft (AG), Sociedad Anónima (S.A), Sociedad a Responsabilité Limitée (SàRL) or Incorporated (Inc.). The name of an offshore shelf company must not mislead the public, must give a true reflection of the services offered, and should not suggest the patronage of the government of royal authority with the use of words like ‘Government’, ‘Her Majesty’ or ‘Municipal’.

Offshore shelf companies are constituted as legal persons that are independent and separate entities from their owners. This endows offshore shelf companies with the power to sign contracts, enter into agreements, undertake legal proceedings, to sue and be sued, as legal persons.

As offshore entities, offshore shelf companies are unable to trade or do business with the local residents of the jurisdiction in which they are registered and incorporated. However, offshore shelf companies are capable of holding offshore bank accounts, able to lease an office to keep books and records, and establish relations with local lawyers, accountants, consultants and other professionals without incurring any tax obligations , since such activities are not considered to be ‘doing business’. Their status as offshore entities, such as Seychelles companies, automatically qualifies offshore shelf companies to operate without any exposure or obligation to taxation by the incorporating jurisdiction.

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