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Company Formation in the BahamasBackground The Bahamas Are An Independent Nation State. The Bahamas became independent from the UK in 1973, although the Queen remains Head of State. Beginning 50 miles off Florida, in the Caribbean, the Bahamas has 700 islands and a population of 307,000. The official language is English. The capital is Nassau, there are a number of international airports with good connections, and there are excellent port facilities. The climate is sub-tropical. The Westminster-style government is business-friendly. Economy Based on Financial Services and Tourism. The Bahamas was a trust and tourist jurisdiction very early in the 20th century, but was relatively late in developing as a financial centre. The economy is heavily dependent on tourism, but financial services are growing in importance. GDP for 2007 was $6.6bn, and GDP per head is $28,000 at PPP, good for the region but not wonderful. Unemployment is a problem, but has eased recently. The Bahamas are very dependent on imports and have a structural trade deficit; recent years have seen budget deficits, which the government will have to address in the context of regional trade liberalisation. International Standing. After the Bahamas was placed on both the FATF and OECD 'blacklists' in 2000, the government extensively revised its legislative structure to bring the country into conformity with tougher international standards, and the Bahamas was removed from both lists as a result. HIGHLIGHTS OF BAHAMAS IBC COMPANIES The International Business Companies Ordinance, effective as of January 15th, 1990, authorizes the creation of International Business Companies (“IBC’s”) to conduct offshore business, with no taxation in the Bahamas, except for a small annual license fee. IBC’s have the power to engage in any lawful activities without the need for special or lengthy object clauses. An IBC is a company that does not carry on business with persons resident in The Bahamas nor have persons resident in the Bahamas as beneficial owners of any of its shares; nor own an interest in real property situated in The Bahamas; nor carry on banking or trust business; nor carry on business as an insurance or a reinsurance company; nor carry on the business of providing the registered office for companies. Nevertheless, an IBC can make or maintain deposits with a person carrying on business within the Bahamas; have a local bank account; maintain offices; retain professional services; hold shares, debt obligations or other securities in an IBC; prepare and keep books and records, such as those of trading operations and hold directors’ and shareholders’ meetings. CONFIDENTIALITY The Bahamas has no double taxation treaties, which could obligate the disclosure of information for clients of other countries. There is a Mutual Legal Assistance Treaty with the United States of America that applies exclusively to information related to criminal activity. As a financial and corporate service provider OMC must keep detailed and updated information in respect of each client, including details of the beneficial owners of all companies. MOVEMENT OF FUNDS IBC’s may transfer funds into and out of the Bahamas without exchange control or restrictions. The currency in use is the Bahamian Dollar. The Bahamian Dollar is fixed to the US$ at par value. US dollars and Bahamian dollars are used interchangeably throughout the island chain. In accordance with the terms of the International Monetary Fund Agreement, the Bahamas has no restrictions on current account transactions. Additionally, there are no restrictions of the free repatriation of profits. The Central Bank administers Exchange control. The Bank, however, delegates to its authorized dealers the power to approve allocations of foreign exchange for certain payments. CORPORATE REQUIREMENTS Name: IBC’s names must contain the words Corporation, Incorporated, Sociedad Anónima, Societé Anonyme, Limited, Gesellschaft mit beschrankter Haftung or their abbreviations. The words “Assurance”, “Bank”, “Building Society”, “Chamber of Commerce”, “Chartered”, “Cooperative”, “Imperial”, “Insurance”, “Municipal”, “Royal”, “Trust”, or any word conveying a similar meaning cannot be used. Furthermore, any name identical to that of a company already in existence or suggesting the patronage of any member of the Royal Family, or the Government of the Bahamas or a department thereof, a statutory corporation, or board, or a local, or municipal authority, cannot be used. A company name can be approved within a few hours of the receipt of the request, and incorporation should be completed within two (2) to three (3) working days from the time the Articles and Memorandum of Association are submitted to the Registrar. Capital/Shares: Capital can be denominated in any currency and shares can be issued other than for cash and with or without par value. Bearer shares are not permitted. Subscribers: Two persons or companies duly licensed must subscribe the Memorandum of Association and Articles of Association. Registered Office / Agent: IBC’s must have a Registered Office and a licensed Registered Agent in the Bahamas. Directors / Officers: Name and address of persons who are directors and officers must be noted on a Register of Directors and Officers. The Register of Directors and Officers, commencing from the date of the registration of the company shall be filed with the Registrar and shall be open to inspection by members of the public during official hours. The Director and Secretary of the company must sign this document and the corporate seal must be affixed to it. We suggest appointing a minimum of two directors, who may be individuals or companies. Register of Members: An updated copy of the register of shareholders must be kept at the Registered Office and must commence from the date of registration. A general meeting of members of are IBC’s shall be held at least one every year. It is not requirements to file a Register of Members at the Registry, however should a client wish to do so then it is worth remembering that the names of the shareholders will be available to the public. Books, Records, and Seal: Books, records, and minutes of an IBC may be kept at a place outside the Bahamas. A Company Seal is mandatory under the Act and an imprint of it must be kept at the Registered Office. TAXATION & FEES IBC’s are exempt from all taxation on capital gains, corporate earnings, personal income, sales, inheritance, or dividends, except for an annual license fee of:
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