The recent changes in the offshore jurisdictions for the companies as well the main legal obligations are important to be analysed for those, who are planning to incorporate a company or already have the company in the offshore jurisdiction. In the corporate context, an offshore entity is the company, which business activity takes place outside of its incorporation place, thus enjoying certain benefits, such as better tax regime.
The recent developments in the offshore countries is a response to the efforts of the international community to combat the money laundering and an attempt to operate in accordance with global compliance standards.
We have summed up for our clients the updates regarding annual return and reporting process of the companies in Marshall Islands, Belize, Gibraltar, Seychelles, Anguilla and Saint Vincent and the Grenadines (SVG).
Some of the main requirements in this jurisdiction are:
- The reporting period will open on the annual anniversary date of the NRDE or FME and the Economic Substance Declaration must be made within twelve months thereafter. For newly formed entities, the reporting period will open on their first anniversary date;
- On 18.02.2018 Marshall Islands have been removed from the black list of the offshore jurisdictions of EU
- No annual return and/or audited accounts required for filing;
- IBC can raise capital from the public, be involved in limited third party trading of securities, act as an investments adviser, and invest funds for other people
By virtue of the new Belize Companies Act 2022, the Online Business Registry System (OBRS) is going to be operative as from 28.11.2022, noting that the only re-registered company will be eligible to request any services from the Registry.
Additionally, all the companies will be obliged to file the Annual Return on or before 30th of June annually as per to the new amendment.
Companies that fail to re -register before 31st of December will face with the following consequences:
- The company will be struck off and subject to a restoration fee (plus the annual fees of all the past years)
- The company must be re-registered and file the Annual Return form (with extra fees and penalties if applicable)
Upon a successful re -registration IBC will be provided with the below updates:
- A new 9-digit number of registration
- The previous registration number
- QR code
- Date of incorporation
The main obligations of the company incorporated in Gibraltar are the following:
- The submission of Annual Return shall be done after 1 month of the anniversary date of the company;
- The Tax Return form shall be submitted 9 months after the accounting period ended, noting that although there is a deadline for the submission, it, nonetheless, can be submitted any time during the relevant 9 months;
- Small Gibraltar entities need only file a Balance Sheet and no audit of this type of company is required unless there is trading with Gibraltar customers, which needs to be submitted 12 months after the financial year end.
In the context of Seychelles, the main obligations which should be followed by the entities are the following:
- By 31 December of each year after the year in which it was incorporated in the approved form signed by or on behalf of the company and containing the information referred to in the Sixth Schedule of the Seychelles Company Act, the annual return of the company should be submitted.
- In the beginning of 2022, the new changes regarding annual records of the company came into force. Prior to that, Seychelles company could keep its accounting records outside Seychelles, provided the directors kept the company’s registered agent notified of the address where the records were kept. However, as from 06.02.2022 every Seychelles company is required to send a copy of their accounting records twice annually to be kept at its registered office in Seychelles;
- In respect of existing accounting records prior to 2022 and accounting records relating to year 2022 for companies on the Register, accounting records for the past 7 years to 31 December, 2021 must be kept in Seychelles by 6 February 2022.
- Moreover, as from 06.02.2022, a large entity (i.e. with an annual turnover above Seychelles Rupees 50,000,000) or a non-large company that is not a holding company (i.e. not a company which only holds interests in other companies or assets), is obligated to prepare an annual financial summary (management accounts) to be kept at its registered office in Seychelles within 6 months from the end of the company’s financial year
Saint Vincent and the Grenadines (SVG)
In the jurisdiction of SVG, the following main requirements should be followed:
- The companies are renewed on a calendar year basis (i.e. on January 1 of each year) rather than on an anniversary year basis (i.e. on the company incorporation month each year). For example, if a company’s financial year end is December 31.12.2021, then the Company must file a tax return with the IRD by March 31.03.2022. The period to which taxes are applicable;
- In 2022, the new changes have been adopted concerning the filing of the document with the Financial Service Authority, noting that although there are certain deadlines, there will be no penalty imposed if it filed afterwards, because it is still considered as new and for the first time for IBCs in SVG.
Although Anguilla has been included in the blacklist of the prohibited for cooperation jurisdictions in EU list, by virtue of the Council’s conclusion dated back to 04.10.2022, Anguilla is waiting for a supplementary review by the Global Forum in relation to Exchange of Information on Request, which could potentially remove the country in the future from the list.
Some of the main obligation of Anguilla companies are the following:
- Annual returns are not required to be filed with the Anguilla Commercial Registry although, there are requirements for the directors to maintain financial information to enable them to operate and function in Anguilla;
- However, by virtue of the Business Companies Act 2022, the Anguilla company has to file the registers of directors, beneficial owners and shareholders alongside with the detailed business activity description in order to classify the company and provide to the registry if it is needed and upon their request but not as the obligation