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September 10, 2007
UNITRUST CAPITAL BECOMES A LICENSED OVERSEAS AGENT FOR ANGUILLA COMPANY FORMATION
Upon reviewing the background information on our company and other application documents the Anguilla Financial Services Commission approved our application and granted us a license of an Overseas Agent.
From now on, Unitrust Capital can provide to our precious customers direct services on company formation and other corporate services in Anguilla. This means that we will be able to provide fast incorporation and additional documents issuance/retrieval services in this jurisdiction at a very competitive price.
Anguilla is an excellent place to form and keep one’s offshore company due to high reputation of this jurisdiction with such international organizations as FATF and OECD, moderate formation costs, and zero taxes for offshore activities of the company. It’s a British Overseas Territory, and the local legislation is based on Common Law.
Both International Business Companies and LLC’s are available in Anguilla.
February 21, 2007.
THE AUDITOR GENERAL PRAISES CRA
The Auditor General of Canada has recently examined activities of CRA (Canada Revenue Agency) regarding non-resident taxation and taxation of international transactions of Canadian residents.
The audit found that the Agency is better able to identify potential non-compliance with the tax rules on international transactions compare to the years 2001 and 2002. The risk assessment tools have improved, and some steps were taken to detect abusive international tax planning schemes. It has also directed more resources to auditing international tax avoidance.
On the other hand, the lack of sufficient international tax audit expertise in some of the tax offices was noted in the report.
The Office of the Auditor General audits activities of the Canadian federal government and the three territories as well as some 40 Crown corporations, and some 20 territorial corporations and agencies. This includes health, culture, the environment, finance, agriculture, transportation, and scientific research, to name only a few. While the Office may comment on policy implementation in an audit, it does not comment on policy itself.
The Office of the Auditor General tables each year in the House of Commons the relevant audit reports.
November 01, 2006
BEARER SHARES AND NEW BVI COMPANY ACTIn accordance with the new Company Act, bearer shares must be deposited with a custodian authorized or recognized by the BVI Financial Services Commission. Bearer shares not deposited with a custodian are immobilized and the rights attaching to them are disabled and any transfer of the certificate is void. The custodian becomes the member of the company but the beneficial ownership of the share remains with the intended bearer.
So, you might be wondering if it has to do anything with your particular BVI company...
BEARER SHARES TEST
In the first instance I ask you to make a simple test and determine if you company is allowed to issue bearer shares, or not.
Note. We discontinued provision of the M&AA allowing bearer shares from October 2003 except for when asked to do so by a special customer's request. So, if your company was incorporated after October 2003 most probably it can not issue bearer shares.
Please kindly open the MEMORANDUM OF ASSOCIATION of your company and find Article 10.
IF article 10 of MEMORANDUM OF ASSOCIATION reads as follows:
"The directors may issue shares as registered or as shares issued to bearer as they may determine by resolution of the directors."
...then your memorandum DOES allow issuance of bearer shares
IF article 10 of MEMORANDUM OF ASSOCIATION reads as follows:
"Notwithstanding anything to the contrary in this Memorandum or the Articles of Association of the Company, or the Act, the directors may issue only registered shares, and bearer shares are not permitted."
…then your memorandum PROHIBITS issuance of bearer shares
ACTION PLAN WHEN YOUR MEMORANDUM PROHIBITS ISSUANCE OF BEARER SHARES
1. I recommend to have your company voluntarily re-registered before December 1, 2006. As I mentioned in my previous email to you, the costs would be US$255 for the original set and US$405 for the apostilled set plus courier delivery costs depending on the destination.
Please let us know (1) if you need a voluntary re-registration and also advise (2) if you need an apostilled set. You may need an apostilled set to deal with banks, foreign authorities and other non-BVI third parties. We will need as an information are you going to pay for this services by a credit card or by a wire transfer or money order/bank cheque, etc.
ACTION PLAN WHEN YOUR COMPANY’S MEMORANDUM DOES ALLOW ISSUANCE OF BEARER SHARES
1. I recommend to have your company voluntarily re-registered before December 1, 2006. As I mentioned in my previous email to you, the costs would be US$255 for the original set and US$405 for the apostilled set plus courier delivery costs depending on the destination.
2. IF the Bearer Shares Test indicates that your company CAN issue bearer shares then you have two options:
OPTION I
This option is applicable when you prefer to retain the right of your company to issue bearer shares
After January 1, 2007 you would have to keep all bearer share certificates with the properly licensed custodian in the BVI or a custodian recognized by the BVI government and located in another country. Please ask for details if interested.
The shares not delivered to a custodian will be disabled. In our case you would have to pay the custodian fee from US$790 p.a. per share certificate plus one time initial set-up costs of US$375. Please note that our preliminary research shows that you may expect considerably higher fees from other custodians.
After January 1, 2007 the BVI Registrar annual fee will increase to US$600 from US$350 for the companies not prohibiting issuance of bearer shares. Note. This would be US$1,100 for the companies with the authorized capital exceeding US$50,000.
OPTION II
This option is applicable when you prefer to ABOLISH the right of your company to issue bearer shares to eliminate future costs for the custodian and increase in the BVI government fees.
The company was have to first file an amendment to abolish the bearer share provision at a fee of $275 for filing (once resolution date is within 30 days of filing). Then on the same date (if you wish) we would file the voluntary re-registration. There will be two separate filing and 2 separate charges.
MY OPINION
I think bearer shares do not worth so much trouble and expenses, and if I were you I would exercise Option II and order its processing to us at once with the voluntary re-registration. Don't forget as well that immobilizing of the bearer shares with a custodian effectively "kills" their mobility.
So, if you follow Option II then please kindly let us know (1) if you need a voluntary re-registration and also advise (2) if you need an apostilled set and (3) confirm that you need to file prohibiting of bearer shares issuance.
CONCLUSIONS
Finally, that’s what is most important: the recent changes in the BVI company law have been a very smart move in response to the "ring fence policy" and other accusations of EU, FATF and OECD. The EU, FATF and OECD implied that BVI created a special type of a tax free company for non-resident owners - BVI International Business Company (BVI IBC), and this was (ab)used by some residents of the Western countries for tax evasion.
Now, from January 1, 2007 there will be only one general trade company act in force in the BVI, and just one type of general trade company. This will be the BVI Business Company allowed to do business in the BVI and tax free for all offshore profits. So, legally it's not an offshore company any more, while actually it preserves most of the attractive features of the BVI International Business Company.
My personal opinion is that the BVI company has become even a more powerful corporate instrument as before.
Just compare...
| Type of Company |
BVI IBC |
BVI BC |
| Filing of directors' names with the BVI authorities |
NO |
NO |
| Filing of shareholders' names with the BVI authorities |
NO |
NO |
| Filing of accounts with the BVI authorities |
NO |
NO |
| Can do business in the BVI |
NO |
YES* |
| Corporate Tax |
ZERO |
ZERO** |
| Bearer shares |
YES |
YES*** |
*The BVI BC company must apply for a trading license to do business in the BVI
**Payroll taxes are to be paid if local BVIlanders are employed by the company
***Bearer shares still allowed but...please see above
MY MESSAGE
So, my message is: don't you worry, business will be as enjoyable as usual with your BVI company, but please consider seriously to bring the corporate documentation of your company in line with the new legislation.
...and, we at Unitrust Capital are always here to help:)
October 20, 2006.
BVI IBC VOLUNTARY RE-REGISTRATION
As you might well know the new BVI Business Company Act has come into force, and all companies previously incorporated as International Business Companies have to be re-registered as BVI Business Companies with the Registrar to govern the company under the new Act.
Re-registration can be done voluntarily or automatically.
VOLUNTARY RE-REGISTRATION
The application and accompanying documents will be filed with the Registrar.
The government deadline for the voluntary re-registration is December 31, 2006. Our own deadline is December 1 as we need some time to prepare and file the documents. Then, don’t forget about Christmas:)!
FEES FOR VOLUNTARY RE-REGISTRATION: $255 plus courier delivery costs. This includes the provision of a Certificate of Re-Registration and two new filed stamped M&AA's TO GOVERN THE COMPANY UNDER THE NEW ACT.
Apostilles would be US$150 ea./per set
AUTOMATIC RE-REGISTRATION
If a BVI IBC has NOT made a voluntary application it shall be deemed to be re-registered under this Act on 1st January 2007. However, in this case the Registrar shall NOT be required to issue a certificate of re-registration to the company UNLESS it applies for a certificate and PAYS the appropriate FEE.
If the company “slept through” the deadline of December 31 2006 and was re-registered involuntarily then due to the increased costs the following FEES will apply:
A certificate of re-registration at a fee of $150 plus US$110 M&AA amendment fee plus $120 for two filed stamped M&AA with the total of US$385 plus courier delivery costs.
Apostilles would be US$150 ea./per set
OUR RECOMMENDATIONS
We strongly recommend proceeding with the VOLUNTARY RE-REGISTRATION before December 1, 2006 as this will allow your company to update the corporate documents in line with the new legislation with minimum costs.
February 22, 2001.
UNITRUST TO PARTICIPATE IN SHOREX
2001 OFFSHORE EXHIBITION
Unitrust Capital Corp. is a proud participant of Shorex
North America 2001. Exhibition tickets are CA$25. If you
or someone of your associates are going to visit SHOREX,
please contact us: it would be
great to meet you near our stand to shake hands and discuss
how could we help you in offshore matters, and it'll be
a pleasure for us to send you one or more free invitations
to the exhibition.
The most famous in worldwide offshore industry event presents
offshore services for professional advisers, company formation,
offshore investments, banking, fiduciary and nominee services,
assets management and protection.
Dates: 26-27 March
Location: Toronto, Canada
Venue: Royal York Hotel
SHOREX
official Web Site
February 15, 2001.
BAHAMAS VS. BVI IN VIEW OF NEW
LEGISLATION
As you might know, the new International Business Companies
Act came into force in the Bahamas on 29th December, 2000.
The principal features are:
1. An IBC may do business with and be owned by persons
resident in the Bahamas.
2. An IBC cannot issue Bearer shares and if they were issued
previously such shares should be recalled and reissued to
two Registered holders within six months after 29th December,
2000.
3. The names and addresses of the Directors and Officers
must be disclosed to the Registry for public view by filing
a Register of Directors and Officers.
4. The Company shall keep a Register of Shareholders that
must be available upon request by the Regulatory Authorities
in the Bahamas.
HOWEVER, WE MAY PROVIDE FOR YOUR EXISTING BAHAMIAN COMPANY
OUR NOMINEE SERVICES
TO SAVE YOUR LOW PROFILE.
Meanwhile judging by the "insider" information
of our associates in the British Virgin Islands, their government
is going to do whatever possible to keep existing low profile
of BVI International Business Companies.
So, bearer shares are still
allowed here, and there is no requirements as to the disclosure
of the names of directors, officers, and shareholders to
the local authorities.
February 01, 2001.
MONTENEGRO NEWS
Due to the ongoing implementing of new legislation, our
incorporation services regarding Montenegrin offshore banks
are temporarily suspended. Beware if somebody tells you
that everything is OK in that jurisdiction!
We'll let you know as soon as the situation is clarified.
December 20, 2000.
THE BURNING ISSUE
The issue is actually burning
too many people, their businesses and hard earned monies:
we mean the recent blacklists of OECD,
Financial Stability
Forum (FSF), and
Financial Action Task Force on Money Laundering (FATF).
Actually any existing
Offshore Financial Center (OFCs) can be found at least
in one of the lists.
Now, let's have a brief historical and background overview
of the ill-famed documents in respect to each of the above
three international organizations.
OECD
The OECD blacklist of tax havens is a result of the mandate
given by Ministers in April 1998. The organization was eager
to stop erosion of tax bases and corresponding revenue of
its member countries.
Two reports were issued since then: Harmful Tax Competition:
An Emerging Global Issue (the "1998 Report") and
Towards Global Tax Co-operation (the "2000 Report").
To put it plainly the focus of both reports was: (1) to
determine the tax loopholes inside of the member countries
and tax competitors in the outer world and (2) to find the
ways to mend the loopholes and eliminate the tax competitors
as such.
The OECD point of view is that the most of evil is dwelling
in OFCs ("tax havens") owing to the following
exempts for non-residents: zero or minimal taxation, provision
of strict confidentiality to the investors or beneficial
owners of offshore vehicles. What's the way out? A very
simple one: tax havens must comply with the instructions
of OECD or be punished by, presumably, economical and political
sanctions (hopefully, not by commandos!). The reports contain
direct threats to use so-called "defensive measures"
in case of non-compliance.
The Financial Stability Forum (FSF)
In March of 2000, the FSF Working Group on OFCs issued a
report where it outlined their principal features and influence
on global financial stability.
Though the report alleges that OFCs "do not appear
to have been a major causal factor in the creation of systemic
financial problems", it strongly suggests to continue
the work on urging of tax havens to enhance regulation of
financial services and cooperation with supervisors from
other countries.
Later, in May of 2000 the FSF issued the list of OFCs where
the tax havens were broken down in three groups: the first
group was considered the best in terms of regulation and
supervision, while the third one being the worst.
Financial Action Task Force on Money Laundering (FATF)
In June of 2000 the FATF issued its own "roll of honor"
where it listed the countries non-cooperative in the fight
against money
laundering. The majority of them are OFCs again.
Dissent
Despite of impetuous declarations of some tax havens to
fulfill the demands of the above organizations, there is
growing dissent and begrudging as within offshore world
as among some influental Western politicians and international
organizations. By some estimates, more than 50% of world
money is in offshore: who'll let them slip away for nothing?
Now, just three true-to-life illustrations:
1. There is no consensus inside of OECD on the issue: Luxemburg
and Switzerland absented from the 1998 Report.
2. The British Commonwealth Secretary-General Don McKinnon
severely criticized the OECD blacklisting. Says Don McKinnon
(about OFCs): "Now these countries face potentially
devastating effects to their economies as a result of the
new OECD proposal".
3. Dick Armey, Republican Majority leader in the US House
of Representatives wrote a letter to Treasury Department
Secretary where he bluntly demanded to stop supporting OECD
recent anti-offshore initiatives. Says Dick Armey: "Mr.
Secretary, I hope you are not committing the United States
to actions that are unlikely to receive the approval of
Congress….I urge you to summarily and immediately reject
this policy and I look forward to learning the actions you
plan to stop the OECD from moving forward."
Arriving to conclusions
The FSF initiatives will find more comprehension with tax
havens; moreover the FSF declared that there are highly
reputable OFCs, and legitimate ways of making one's business
offshore exist. Some OFCs may sacrifice confidentiality
aspects of their offshore legislation and become more susceptible
to inquiries of foreign authorities. On the other hand,
offshore services are "the pillars of a state"
in a typical tax haven, and it would be an economical suicide
to level them down considerably.
Oh, yes, many things are changing owing to the above intergovernmental
efforts, some successful practices will be gone forever,
some new ones are inevitably emerging, but it's apparently
impossible to "forbid" offshore as a lawful way
of conducting business and/or attaining of one's
tax planning or
asset protection goals. Nobody as well can kill competition
in any field: it's the essence of life itself; nobody is
able to turn the tide of capital flows streaming in the
direction of lower taxes and minimum regulation.
The point is and will always be that money makes freedom,
and freedom makes money!
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