Offshore jurisdictions used to be extremely popular with international business people for two main reasons. First, they provided for a high level of privacy for the owners of the companies that were registered there. No government body of a foreign country was able to find out who the ultimate company beneficiaries were if the company was registered in an offshore jurisdiction. Second, businesses operating from such jurisdictions enjoyed substantial tax benefits. Things started to change after the 9/11 terrorist attack on New York Trade Center in 2001. An international campaign against offshores began and most offshore jurisdictions were included in the so-called ‘black lists’ of countries.
One reason for launching this campaign was praiseworthy indeed. Because the names of the offshore-registered company owners were kept secret, these companies were sometimes used for illegal purposes. What made the situation especially dangerous was that terrorists were financed through some offshore companies. Not surprisingly, the international community could not tolerate this state of affairs any longer after the 9/11 attack.
Another reason the campaign was started for was not so praiseworthy but it is understandable anyway. The authorities of large economically powerful states were very unhappy to see that some of the tax money escaped their national budgets. Tax rates in first-world countries are notoriously high and their residents naturally tried to save on taxes by registering their business companies in offshore jurisdictions where taxes were much lower. Thus, various international organizations applied great pressure to offshores forcing the small island countries to reveal the identities of the company owners and increase the tax rates.
Where do things stand now? Shortly speaking, the level of company ownership privacy in offshore jurisdictions is now lower than it used to be but it is still higher than in most continental countries. Similarly, the tax incentives offered by offshore jurisdictions are not so many any longer but some still exist. Therefore, registering a company offshore does have economic sense notwithstanding all the changes that have been happening over the last few years. Here we would like to draw your attention to the opportunity of registering a Limited Liability Company in Nevis. You can find more information about this opportunity if you click here.
Nevis is the smaller island in the Federation of two islands – St Kitts and Nevis. The country has been an offshore jurisdiction since 1983 when it became independent from Great Britain. What is particular about the country is that the corporate legislation of St Kitts differs from the corporate legislation of Nevis. The latter island offers more attractive conditions to foreign business people wishing to register companies there.
Under the pressure from the EU and the USA, Nevis has had to comply with some of the new rules that the business world has to live by these days. However, the country has surrendered the privileges that it used to offer to foreign investors only to the extent that has allowed it to leave various black lists. So, Nevis is no longer blacklisted by any international organization and companies registered there do not have an ‘image problem’ any more.
At the same time, registering an LLC in Nevis brings several important advantages. First, the country is on friendly terms with the USA, the EU, and basically with all other powerful players in the world market. Business people from well-developed states do not frown on the owners of Nevis companies these days. Secondly, the information about the company owners is not available to the public. If a court of law requests this information, it has to be supplied but Nevis-registered company owners should not worry about their names being disclosed to fraudsters and competitors. Thirdly, the assets of a Nevis-registered LLC are well-protected.
Let us dwell on this issue in a bit more detail. How exactly does the corporate legislation in Nevis protect the assets that belong to the company (we will not be speaking about personal asset protection)? First, a court decision made in a foreign country is not automatically recognized by Nevis courts of law. If somebody files suit against your Nevis LLC and a foreign court makes a decision that is unfavorable for you, the matter has to be taken to a law court in Nevis before the claim may be satisfied. The Nevis court, in its turn, will ask the foreign judge to conclusively show that your company is at fault indeed. This means that only a Nevis judge can rule for the plaintiff.
Suppose a creditor wants to sue your Nevis LLC. Before they can do so, they have to make a substantial payment to the authorities of St Kitts and Nevis. In case they lose the case, the payment will be used towards covering the costs of investigations. That is to say, they are getting nothing back. Statistics shows that plaintiffs lose in a vast majority of cases, so any creditor is going to think twice before taking your Nevis LLC to court.
Suppose now that a suit is filed against your Nevis-registered company and you lose the case. For instance, the claimant has been able to conclusively prove (which is difficult) that an illegal transfer of money has been made to your company bank account. In this case, the claimant will have the right only for the amount of the money transfer. Besides, only the profits (dividends, etc.) made by your company can be used to repay the debt. That is to say, your company’s fixed assets and property will remain intact in any case. Moreover, after two years, the owner of Nevis LLC repaying the debt has the right to apply for canceling the Charging Order and stop the payments.
Even though Nevis does exchange fiscal information with other countries now, following international rules, it still offers some highly attractive instruments of corporate asset protection. Thus, registering an LLC in this jurisdiction could be the right thing to do.
