An international business company or international business corporation (IBC) can be regarded as an offshore company that has been formed under the laws of specific jurisdictions as a tax-free company which does not have the permission to engage in business within the jurisdiction it is incorporated.
The characteristics of International Business Company do vary from jurisdiction to jurisdiction. However, some common characteristics of International Business Companies are:
The International Business Companies are exempted from local corporate taxation and stamp duty, with the condition that, it should not engage into any local business. However, the fees for the annual agent and registration taxes are not included in the exemption.
They help in reserving the confidentiality of the beneficial owner
The International Business Companies do have corporate powers to engage in different businesses and activities
The International Companies can issue shares. That can be either in the registered or bearer form.
They have a provisional place for a local registered agent
It can abrogate the requirement to demonstrate corporate benefit or appoint local directors or officers.
The process of an International Company Formation involves the following steps:
Approval of company name
The approval of the name is the first step in the setting up of an International Company. The Registrar of the Companies only approves the proposed name when it is not identical or almost identical to the name of any company that is already existing. When it comes to the name, the words like bank, insurance, and group are used only if the company has a special requirement for that or functions in particular sector/sectors related to those.
If any existing has any problem with the name of a new company, it can object the same, however, within a span of six months.
Another integral requisite is the address of the company. The address which is recorded in the Companies Registration Office is the registered office of the International Company. This is a very important part of company formation as the official mails or correspondences need to be sent to the address which is recorded as the registered office. Please note that the registered office address can be different from the trading office address.
In the International Company Formation, the shareholders and stockholders play a very important part as they invest into and hold shares in the assets of the company. They have also specific rights like voting at general meetings of the company.
If the company is making considerable profit, they have the right to be awarded a considerable dividend. If it is liquidated, they can also make claims to get back the money they invested. What’s more, the shareholders even have the power to remove the Directors of the company.
Authorized and issued share capital
The authorized capital signifies the total numbers of shares that can be issued among. This plays a key-role in the International Company Formation as shares are allotted to different share holders which is known as the issued share capital of the company.
Memorandum and Articles
The objectives are, main and subsidiary, are together referred to as the Memorandum of Association. It describes in a nutshell the name and the limited liability of the members of the company. The internal operations and the management that sets the meetings and the number of directors for a quorum are governed by the Articles of Association.