Nominee services are usually provided by an intermediary in order to hide the beneficial owner’s business. Nominee services are related to nominee shareholder and nominee director. In the regular situation the nominee services should also involve a post box service (office address for correspondence purposes). Nominee services are suitable for large corporate structures for tax planning purposes and frequently involve international element. For instance, the ultimate beneficiary is based in other country rather than the company itself.
Nominee shareholder services are usually carried out basing on declaration of trust, whereas the nominee declares that he holds shares on behalf of other person and he is not entitled to make decisions in the company, to neither vote at a meeting of shareholders, nor receive dividends, unless specifically instructed by the client. The nominee has no rights to sell shares unless required by the client. However, the client and nominee may agree on specific duties that the nominee should carry out. Such duties are often assigned to lawyers and attorneys at law that are professionals in the field and may protect the client`s interest.
Nominee director also called 'shadow director', who usually appears only for official records, whereas the company is virtually governed by the client by power of attorney. On the basis of authorization the client may open a bank account and acquire full company management and control.
Contact us now, if you require nominee services in any jurisdiction!
Advantages of nominee services
The advantages of using nominee services appear in cases when a businessperson wants to keep his privacy and decreases the visibility into official records or does not want his name to be associated with the concerned company. Moreover, there can be a situation, when a person has restrictions to exercise the planned activity or when the law requires a local management, for example, a local secretary in Hong Kong.
When a quick action is necessary to register a company abroad, in case the client cannot travel, it is often more convenient to temporarily appoint a local company manager. If the intention is to open a company in overseas jurisdiction, such as BVI, Belize, Hong Kong, it might be physically complicated to arrive in person.
Nominee services usually guarantee confidentiality and anonymity. However, a disclosure sometimes happen at bank or in investigation authorities during court proceedings.
The nominee services are widely used for tax planning and asset protection purposes. If ultimate beneficiary of completely corporate structure is based in low tax countries, he should enjoy the benefits of low tax system for the received dividends from the earned profits.
Other advantage derives from the registration country and is often referred to financial statements and reports. In some tax haven jurisdictions there is no need for submitting the annual, therefore, low auditing and bookkeeping requirements that provide certain advantages, if the person is willing to increase privacy and confidentiality and hide his/her assets.
Term 'nominee' may be referred to a nominee director or a nominee shareholder. Confidus Solutions can provide you with both services worldwide, depending on your corporate structure and personal goals.
Nominee director usually is a local resident. However, it can also be a person from abroad, since there are no specific requirements provided. Nominee director should be an individual or a private person. In some countries, a director – is an institution so that the director might be a collegial body.
For the nominee service purpose in certain jurisdictions, the nominee shareholder usually is an individual private person. The person can be resident or non-resident, depending on a particular case.
Confidus Solutions nominees
It is possible to combine nominee services and extend the corporate structure up to two level nominees. Nominee director and nominee shareholder should not necessarily be the same person or be located under the same jurisdiction. For tax planning purposes there might be different solutions.
Confidus Solutions have partners and agents all around the world that allows us to provide nominee services worldwide, depending on needs and goals of our clients. Our lawyers and tax advisers will provide you with detailed opinion on tax planning as well as offer unique corporate structure fitting your needs. Call us to appoint nomine for your company!
Legal grounds for nominees
Nominee services are established under agreement between the client and nominee. Agreement is usually valid for one year and can be prolonged in case of successful co-operation. The documents that will approve the actual status, serves as the declaration of trust signed by nominee shareholder, approving that he/she has no actual interest in the company and all decisions will be made by the client, including, but not limited to sharing profits and paying dividends, appointing company board, etc. The nominee director should issue a power of attorney by giving full power to the actual owner or to any other person upon client`s choice. The nominee director does not actually run the company.
The agreement concluded between the client and nominee is governed by the local civil law. The nominee concept historically comes from the bank law as a specific service for bank clients. Nowadays, many jurisdictions offer such service as a business and the provisions of such services stems out of customary law combining the best practice worldwide.
Liability of the nominee
Nominee bears full responsibility for his/her actions and the client holds him/her accountable at all times, nominee should act only in accordance with the client’s instructions and given assignment in good faith and with a high level of loyalty. The provisions of liability can be regulated by the agreement.
However, the nominee status does not change the statutory liability and state authorities hold him/her accountable for his/her actions as a company officer, including civil, criminal and administrative liability. Also, nominee is liable to the client according to the content of the agreement and given assignment.
In low tax jurisdictions, the nominee services are usually well-developed and the liability is more flexible. Anyhow, the nominee cannot perform any actions against client’s will.
Confidentiality issues and beneficiary
One of the advantages of using nominee services - is protection of assets, therefore, the confidentiality clause is extremely important. Keeping in mind nominee’s liability according to the national law and governmental institutions, such as tax office, the nominee shall keep full confidentiality and should not disclose any information regarding the client and the beneficial owner. In some jurisdictions, the nominees shall not disclose any information even upon the request of a prosecutor office or proceedings at court. Eventually, the disclosure duty has become more sensitive, since the nominee services have been used actively in complicated corporate structures on international level.
Nominees and corporate banking
Bank is usually treated as the co-operation partner at any business with a high level of confidence and strong loyalty. Generally, bank is the only organization that should know the actual beneficial owner. The legal acts of European Union require a strict compliance and due diligence procedures in order to open a corporate bank account. However, in each European Union member state, the requirements may differ and each bank may check the client by slightly different internal procedures.
If you want to know more about banking or require a bank account – click here.
Top 5 jurisdictions for nominees
Practice shows that the nominee services grant major benefit in the favorable tax regime jurisdictions, due to low tax regime and commonly admitted nominee concept. We would highly recommend you considering following jurisdictions as top choice based on time period required to open a company and availability of nominee services.
Belize is a small country on the Eastern coast of Mexico, formerly known as British Honduras. This jurisdiction has a lot to offer to international investors as well as to corporate giants in terms of favorable tax regime and banking legislation. On the grounds of provisions of the International Business Company (IBC) act of 1990, resident Belize companies are fully exempted from all types of taxes and stamp duties, including incomes from any sources. International Business Company (IBC) incorporated under laws of Belize - is a perfect solution to secure your confidentiality as nominee services are allowed, but not all information on directors and shareholders is a part of public register entry. Incorporate in Belize.
British Virgin Islands (BVI)
British Virgin Islands were first and quite prestigious low tax jurisdiction and financial center. BVI offers its business companies 0% corporate income tax, low annual maintenance cost and publicly unavailable information regarding company’s officers and shareholders. Also, companies incorporated in other jurisdictions are recognized as business companies, making BVI one of the top choices for using nominee services. Read about BVI companies.
Panama is a country in Central America, famous for its tax regime. Panama is a vital transport hub, as it has Panama Canal, which serves as a connection for numerous trade networks between Atlantic and Pacific oceans. This jurisdiction is commonly used for opening and operating personal and corporate bank accounts, as local legislation provides investor-friendly environment. All information regarding bank beneficiaries is strictly confidential. Companies incorporated under jurisdiction of Panama may be used as a tool in order to achieve required corporate structure. Open your company in Panama right now!
Seychelles is a quite favorable territory, offering low tax regime to international investors and entrepreneurs. The government has invested a lot of funds in order to make islands a prestigious investment hub as we know it today. Over the last decades, Seychelles has seen dramatic modernization of legislation, which has resulted in a modern, but strict business hub formation. Legal acts controlling Seychelles tax regime and tax application offer excellent tools for asset protection, tax reduction, privacy protection for both: individuals and companies. Discover more about Seychelles company.
Company incorporation in Hong Kong is a pretty common procedure. In Hong Kong there is no tax on dividends for private limited companies, and the profit tax is applied only to profits deriving from Hong Kong. Hong Kong is economically blooming and rapidly developing business center with numerous international banks and corporations having local offices, which opens doors for international trade and co-operation. Read here about Hong Kong companies.
Confidus Solutions will help to you evaluate all possible options and choose the most efficient solution in order to achieve your personal goals! We have many years of expertise in this industry and experienced agents and lawyers that can incorporate into any jurisdiction worldwide! If you require more information – check our offered solutions or contact us to get a unique offer!