Forming a company in Cayman Islands
January 13th 2009 02:00
When I tell my friends that I am now living and working in the Cayman Islands, many of them inevitably ask how easy it is to form a company in this tax-free haven. I got tired of explaining the whole company formation thing so I decided to blog about it and then refer them to this blog. In fact, this is now true of any subject I am asked about on the Cayman Islands. Anyway here goes…
There are over 40,000 companies registered in the Cayman Islands, anybody but anybody can register a company in the Cayman Islands as long as that company does not do business in the Cayman Islands. (If you want to do business in the Cayman Islands, then you have to go through a whole vetting process with the investment authorities in Cayman Islands).
In addition to the speed of processing, other advantages of registering a company in the Cayman Islands include the following:
* There is a complete absence of direct taxation i.e corporation, capital gains, payroll, property or withholding taxes.
* There is protection of the legitimate interests of clients. Except where assistance to law enforcement agencies is mandated or authorized, disclosure of information by government officials, professional agents, attorneys and accountants and their staffs is forbidden by law under severe penalties.
* There are very minimal reporting requirements.
* You can form a company with only one shareholder, with no minimum capitalization requirements.
Remember if your intended business will be conducted mostly outside of the Cayman Islands, then within 10 days maximum you can form a Cayman Islands Exempt Company.
In order to form an Exempt company, you need to submit a Memorandum and Articles of Association and registration fee to the Registrar of Companies, together with a sworn statement declaring that the business activities of the proposed company will be undertaken mainly outside the Cayman Islands. The names and addresses of the proposed first directors must be disclosed to the Registrar.
The Exempt Company cannot trade within the Cayman Islands, own real estate in the Cayman Islands and cannot undertake the business of banking, insurance business or mutual fund business unless licensed. It also cannot solicit funds from the public.
There are over 40,000 companies registered in the Cayman Islands, anybody but anybody can register a company in the Cayman Islands as long as that company does not do business in the Cayman Islands. (If you want to do business in the Cayman Islands, then you have to go through a whole vetting process with the investment authorities in Cayman Islands).
In addition to the speed of processing, other advantages of registering a company in the Cayman Islands include the following:
* There is a complete absence of direct taxation i.e corporation, capital gains, payroll, property or withholding taxes.
* There is protection of the legitimate interests of clients. Except where assistance to law enforcement agencies is mandated or authorized, disclosure of information by government officials, professional agents, attorneys and accountants and their staffs is forbidden by law under severe penalties.
* There are very minimal reporting requirements.
* You can form a company with only one shareholder, with no minimum capitalization requirements.
Remember if your intended business will be conducted mostly outside of the Cayman Islands, then within 10 days maximum you can form a Cayman Islands Exempt Company.
In order to form an Exempt company, you need to submit a Memorandum and Articles of Association and registration fee to the Registrar of Companies, together with a sworn statement declaring that the business activities of the proposed company will be undertaken mainly outside the Cayman Islands. The names and addresses of the proposed first directors must be disclosed to the Registrar.
The Exempt Company cannot trade within the Cayman Islands, own real estate in the Cayman Islands and cannot undertake the business of banking, insurance business or mutual fund business unless licensed. It also cannot solicit funds from the public.
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