Below are the main characteristics of popular international jurisdictions.
Cyprus
The Republic of Cyprus enjoys a strategically beneficial location at the intersection of the traditional shipping routes between Europe and the Arab World. It is the third largest island in the Mediterranean Sea after Sicily and Sardinia. It covers an area of 9,251 sq km, has a population of about 800,000, and lies 65 km south of Turkey, 96 km west of Syria, 385 km north of Egypt and about 980 km south-east of Athens, Greece. The capital of Cyprus is Nicosia with a population close to 300,000. The language of Cyprus is Greek with English being widely spoken.
The lovely Mediterranean island enjoys the benefit of full European Union membership. For many years now it has also managed to successfully develop strong links with central and eastern European countries, particularly Russia and other CIS countries. Cyprus enjoys a wide network of Double Tax Treaties and is, therefore, a dominant player for tax planning structures. It is a prosperous financial centre with an open free market economy. The government of Cyprus has implemented significant corporate tax incentives. Indeed it boasts the lowest corporate tax rates in Europe. Cyprus has the advantages of about 40 Double Tax Treaties. This is quite unusual for a low tax jurisdiction. In mid 2002, as part of the Income Tax Act, the House of Representatives approved a uniform 10% corporate tax rate to apply to all legal entities registered on the island, thereby eliminating any distinction between onshore and offshore companies (owned by non resident persons). Furthermore, Cyprus is renowned for its efficient, stable, and reliable banking system and effective professional sector, both audit and legal.
Some of the main factors and advantages that developed Cyprus into a successful international business and financial centre and secured Cyprus’ attractiveness to international businesses and worldwide investments are the following:-
10% corporate tax rate for business profits;
No withholding taxes imposed on dividends, interest, and royalties for non-residents (whether a company or an individual);
Income from dividends is exempted from income or corporation tax;
Exemption from income or corporation tax of gains made by an individual or company resident of Cyprus from the sale of securities;
The attractive platform and tax regime that Cyprus provides for a holding company (subject to certain conditions, full exemption from local taxation in respect of dividends received by a holding company from its local and foreign subsidiaries);
The attractive platform and tax regime that Cyprus provides for International Trusts;
The network of favourable Double Taxation Treaties (DTT) that Cyprus maintains with about 40 countries;
Tax advantages available to non-residents including non - E.U. residents;
Cyprus does not have any rules stating that holding companies cannot perform operating activities;
Cypriot tax regime permits losses to be carried forward indefinitely;
The highly developed and secure banking system;
Availability of high quality accounting and consulting services;
The U.K. Company Law heritage/common law tradition;
The geographic location of Cyprus, located at the crossroads of Europe, Asia, and Africa;
The English language being widely known and used in Cyprus.
Seychelles
The Seychelles is a group of about 100 islands in the Indian Ocean. It has a population of around 80,000, descended primarily from French settlers, Africans, British sailors, and traders from the east.
Seychelles is an independent republic within the British Commonwealth. Seychelles started modern constitutional changes in 1960. The Seychelles economy is primarily based on tourism and fishing. The rapidly expanding financial sector, linked to the establishment of the Seychelles International Business Authority and a suite of progressive laws facilitating the establishment of offshore structures while encouraging inward investment, is now a significant element of the economy. The official languages are English, French, and Creole with English being the main language of business.
Local currency: Seychelles Rupee. Exchange controls do not apply to 'offshore' business.
The legal system of Seychelles is based on English Common Law and French Civil Law.
Seychelles Company Description:
Type of Company for International Trade and Investment: The Seychelles International Business Company.
Restrictions on Trading: Cannot trade within the Seychelles or own real estate there. Furthermore they cannot be involved in the business of banking, insurance, assurance, reinsurance, fund management, and asset management (other than the company's own assets). A Seychelles IBC cannot provide registered office facilities in the Seychelles, or sell its shares to the public.
A Seychelles incorporated Company has the same powers as a natural person.
Registered Office Requirement: Yes, must be maintained in the Seychelles at the office of a licensed Registered Agent.
Annual Licence Fee: US$100 irrespective of Authorised Capital.
Financial Statement Requirement: No, but a company must keep records to reflect its financial position.
Minimum number of Directors: One, natural person or a body corporate, of any nationality and need not be resident in the Seychelles.
Company Secretary Requirement: No, although it is customary to do so, a natural person or legal entity, be of any nationality and need not be resident in the Seychelles.
Minimum number of shareholders requirement: One.
British Virgin Islands
The British Virgin Islands (BVI) is an archipelago of about 40 islands, 16 of which are inhabited. They are located 100 kilometres east of Puerto Rico. The BVI financial services authorities have responsibility for its internal self-government, while the political and economic stability of the territory is assured through its association with the UK, BVI being a British Overseas Territory with self-government in relation to internal matters. The 1977 constitution provides that the UK is represented by a governor responsible for external affairs, defence, internal security, and public service.
The population of the BVI is approximately 23,000. The capital, Road Town, is on the southern shore near Sir Francis Drake Channel. Tortola is the largest and most populated of the British Virgin Islands with a population of 18,000.
The economy of the BVI, is one of the most prosperous in the Caribbean area, and is highly dependent on tourism.
Registration of offshore companies commenced in 1984. By 2008 close to 900.000 companies have been incorporated, making the BVI one of the leading offshore jurisdictions in the world.
The official and spoken language is English while the local currency is the US Dollar. BVI have no currency exchange restrictions/controls.
Type of law: Common Law, based on English Common Law with local modifications and local statutes.
BVI Offshore Company Description:
Business Company's (BCs) are companies incorporated in the British Virgin Islands (BVI) under the International Business Companies Act of 1984. BCs can only carry out business activities outside the BVI. It may not have business activities with BVI residents. BVI BCs are a very popular and widely used because of their administrative ease, zero tax characteristic, and their wide acceptance by the international financial community.
Hong Kong
Hong Kong is located on the south east coast of China and consists of a large number of islands and a part of the mainland totalling approximately 1,064 sq km. On July 1, 1997 all of Hong Kong reverted from British control back to China and became a Special Administration Region 'SAR' within the People's Republic of China (PRC) It has a population of about 7 million. Under the 'one country - two systems' philosophy, the SAR has executive, legislative, and independent judicial power. The capitalist system, legal structure, and lifestyle remain unchanged.
Hong Kong remains a free port with a free flow of capital and a freely convertible Hong Kong dollar. As a result, Hong Kong elects its own legislature and maintains its own court structure. Hong Kong has excellent communication facilities and a major new international airport which opened in 1998. Hong Kong is the leading SE Asian centre for both finance and commerce and ranks as the world's third largest financial centre after New York and London.
The official languages are English and Chinese, with English being used in the commercial and political context. The local currency is the Hong Kong Dollar, which is officially pegged to the US Dollar at a rate of 1USD = HK$7.78. Hong Kong has no exchange controls.
The legal system is based on the UK common law.
Panama
The Republic of Panama is located between Costa Rica and Colombia and forms the narrow, lowest portion of the isthmus that links North and South America. It is best known for the Panama Canal which joins the Caribbean Sea to the North Pacific Ocean. It has a population of approximately 3.5 million. Panama City, the country's capital, has a population of about 1.7 million.
Panama was a Spanish colony until 1821. In 1903, Panama broke an alliance with Colombia and became an independent republic. The Colon Free Zone, Panama's Free Trade Zone is the second largest in the world after that of Hong Kong. Operations and transactions taking place in the Free Trade Zone are subject to a special tax treatment whereby imports from other parts of the world and re-exports to other countries are exempted from any Panamanian import or export taxes.
Spanish is the official and spoken language. English is also spoken widely in urban areas and is used daily in commerce and international trade. Panama uses the United States Dollar as its currency.
The laws of Panama are based on Spanish Civil Law with many Common Law influences, particularly regarding Company Law.
General Company Description:
Type of Company for International Trade: Generally, companies are incorporated under the Corporation Statute Law 32 of the 1927 Commercial Code. Limited Liability Companies and Limited Partnerships are also used.
Panamanian companies cannot undertake the business of banking, trusteeship and trust administration, insurance, assurance, reinsurance, fund management, investment funds, collective investment schemes or any other activity that would suggest an association with the banking, finance, fiduciary or insurance businesses.
Language of Legislation and Corporate Documents: Spanish and certified English translations.
Registered Office Requirement: Yes, must be maintained in Panama at the address of the Registered Agent.
