An international business company or international business corporation (IBC) is an offshore company formed under the laws of some jurisdictions as untaxed company which is not permitted to engage in business within the jurisdiction in which it is incorporated.
Characteristics of an IBC vary by jurisdiction, but will usually include:
- exemption from local corporate taxation and stamp duty, provided that the company engages in no local business (annual agent's fees and company registration taxes are still payable, which are normally a few hundred U.S. dollars per year)
- preservation of confidentiality of the beneficial owner of the company
- wide corporate powers to engage in different businesses and activities
- abrogation or restriction of the requirement to demonstrate corporate benefit
- the ability to issue shares in either registered or bearer form
- an abrogation of any requirements to appoint local directors or officers
- provision for a local registered agent
However, under pressure from the Organisation for Economic Co-operation and Development (OECD) and the Financial Action Task Force on Money Laundering (FATF), most offshore jurisdictions have removed or are removing the "ring fencing" of IBCs from local taxation. In most of the jurisdictions, this has been accompanied by reductions of levels of corporate tax to zero to avoid damaging the offshore finance industry.
In contrast, Seychelles residents are legally able to own and operate a Seychelles IBC as long as the IBC is not conducting business within Seychelles. Seychelles also has a "territorial" tax system meaning that Seychelles residents are only taxed on their locally sourced income. Therefore, there is no advantage to non-residents over residents and claims of "ring fencing" have no merit on the Seychelles IBC. This has been, and continues to be, used successfully by Seychelles in defense of the Seychelles IBC vs. international bodies such as the OECD and FATF. Boosting the defense even more is the fact that there are no restrictions on a Seychelles IBC owning shares of a Seychelles domestic company.
Further, most jurisdictions (Panama and Seychelles being the key exceptions) have either eliminated or highly restricted the issuing of bearer shares by IBCs due to international pressures.
Read more about International Business Company: The IBC Legal Entity
Famous quotes containing the words international business, business and/or company:
“International business may conduct its operations with scraps of paper, but the ink it uses is human blood.”
—Eric Ambler (b. 1909)
“Mily: You must remember me!?
Tadeusz: I never remember pretty women. It’s so expensive.
My friend, after twenty thousand years murder is still a business that’s mainly in the hands of amateurs.”
—Orson Welles (1915–1985)
“The old idea that the joke was not good enough for the company has been superseded by the new aristocratic idea that the company was not worthy of the joke. They have introduced an almost insane individualism into that one form of intercourse which is specially and uproariously communal. They have made even levities into secrets. They have made laughter lonelier than tears.”
—Gilbert Keith Chesterton (1874–1936)