Do you have Offshore companies registered in jurisdictions which have been forced to adhere to the Economic Substance Regulations (“ESR”) dictated by the EU/OECD (such as BVI, Cayman, Anguilla, Bermuda, etc.)? Your cost of maintaining those companies annually will now be subject to an exponential rise, potentially well in excess of USD20,000- per annum to accommodate the applied provisions of ESR.
Your Clients and your own organization with registered Offshore companies in jurisdictions now covered under ESR must seriously review those companies to determine if they now fall under ESR and if so, to immediately re-domicile them to Samoa. As you are aware Samoa is a well-regulated and respected jurisdiction firmly based on New Zealand and commonwealth law. Samoa has steadfastly opposed the EU/OECD Economic Substance Regulations and as a result annual costs will be a fraction of the costs for entities covered by ESR.
Below is a summary of the requirements under ESR regulations and also requirements too re-domicile to Samoa:
For a relevant BVI, Cayman Island, Bermuda, etc., the below summary substance elements apply, the substance requirements include:
- Managed and directed locally by the Board
- Adequate qualified local employees
- Physical local premises
- Core income generating activities conducted locally
- Adequate operating expenditure
- For a pure holding entity, the substance requirements include:
- Compliance with statutory obligations under the jurisdiction’s companies’ laws
- Adequate employees and premises for holding and managing the equitable interests / shares.
A legal entity which carries on a relevant activity during any financial period must comply with the economic substance requirements in relation to that activity.
For example, for BVI, Section 6 of the Act defines “relevant activities” to include the following:
- Banking business;
- Insurance business;
- Fund management business;
- Finance and leasing business;
- Headquarter business;
- Shipping business;
- Holding business;
- Intellectual property (IP) business;
- Distribution and service centre business
Relevant activities exclude the following (non-exhaustive):
- Holding of immovable property
- Investment Funds
- Registered entities that do not receive income from the respective businesses
- Registered entities that are tax residents in another jurisdiction (not being a black-listed jurisdiction)
As such there are few typical “holding” companies that avoid being required to provide “substance”.
Re-domiciliation to Samoa:
The procedure and documentation to re-domicile a company to Samoa is as follows:
1. A check of the name of the proposed company to be redomiciled;
2. Where the name is acceptable an “Application to Re-domicile” is filed together with the following:
– The original or certified true copy of the Company’s Certificate of Incorporation;
– An original or certified true copy of the company’s M&A;
– Original or certified true copy of Certificate of Good Standing;
– Copy of specific provision in the jurisdiction of origin’s legislation allowing the transfer of domicile and an original or certified true copy of the approval from the relevant authority of that jurisdiction for the company to transfer out of that jurisdiction to Samoa;
– An original or certified true copy of the director’s and or shareholder’s resolutions approving the re-domiciliation; and
– 3 x original revised M&A of the company to comply with Samoa’s International Companies Act 1988. This is to be signed by us as subscriber and dated the date of the application. We suggest that the revised M&A be our standard M&A and we will prepare and provide.
Provided that all the documentation is in order, the re-domiciliation may be affected within 24 hours of lodging the application.
What are the regulations on other Offshore companies?
What are the advantages of Samoa as a jurisdiction for company formation?
- Strictly adhering to New Zealand and Commonwealth Laws.
- Complete confidentiality and Privacy
- Tax advantages
- Access to financing resources, such as international investment funds
- Shield from legal litigation and court orders
- Security of asset and nimble operations for preservation and growth of the existing fund
How do I register and sign up for the program?
2. Submit application form with all the relevant and required information.
3. Have the documents certified by domestic licensing proof and confirmation.
4. Provide all the necessary information
5. Follow the registration and membership information from the email.