Company Formations – A jurisdictional guide to setting up a business

The following article contains the Foreword in the IR Global Virtual Series brochure on 'Company Formations – A jurisdictional guide to setting up a business'.

The brochure features jurisdiction-specific advice from 24 firms with expertise in company formations. They guide you through the various formation vehicles available in their jurisdictions, and offer advice on regulatory hurdles you need to be aware of, or opportunities you may find useful. They also discuss various KYC compliance regulations, describing the best ways to streamline these onerous obligations.

Multinational corporations require a range of different
structures in order to maintain a global presence. These structures can be used
for different purposes, whether it is developing a trading operation in a
country, or establishing a holding structure for wider business interests in a
region.

Before taking the plunge and forming a company, there are a
number of important considerations to take into account, in order to find the
right structure with the right flexibility for your needs.

Initially you must consider the incentives available for
setting up a new operation in a country. This includes things like enterprise
zones and tax breaks. Many countries will make it attractive for foreign
investors to establish in their country, subject to certain conditions such as
investment in underdeveloped regions. Double taxation treaties can also be
important to reduce withholding and corporation tax, while ensuring profits are
not taxed twice.

Once you have established these parameters, then it is time
to choose the type of structure required to meet your needs. Issues such as
speed of formation, disclosure and compliance are critical to making sure the
company form is fit for purpose.

If you are testing the market in a certain jurisdiction, you
may decide that a branch office of an existing operation will suffice. If a
more permanent establishment is required, then a limited company or partnership
may be a better fit. Each will have different requirements around start-up
capital, registration documentation and ownership.

As an example, limited companies will usually require
directors, shareholders and articles of association to be drawn up, while
branches don’t have those stipulations. In some jurisdictions, such as Qatar
and other Gulf states, there is a restriction on how many shares a foreign
national can own. This means thought must go into finding a local partner to
act as an investor.

If a holding structure is required for managing wealth or
trading operations in a region, then international business centres with
favourable rates of taxation are usually most attractive. These structures can
be limited companies, foundations or trusts and their effectiveness will differ
depending on use. In most cases the ideal location for a holding structure will
be tax efficient, but also subject to a strong, internationally-recognised,
regulatory framework in line with Organisation for Economic Cooperation and
Development (OECD) standards.

One area that touches all forms of company formation is
compliance around anti-money laundering and know your customer (KYC)
regulation. The OECD has set global standards on this, that all reputable
jurisdictions adhere to. The Financial Action Task Force (FATF) advocates a
risk-based approach to KYC, suggesting that resources are allocated so that the
greatest risks receive the highest attention. Businesses that do not cooperate
fully on this, with regard to ultimate beneficial ownership (UBO), are likely
to find it harder to establish companies in the jurisdictions they want to
operate in. They will also find it difficult, if not impossible, to open bank
accounts, since banks are subject to some of the strictest compliance
procedures around.

The upshot is that establishing a presence in another
jurisdiction can be a very difficult and complex procedure, that requires the
advice of a professional ‘on the ground’. Attempting the process without help,
will likely result in inefficiency and even failure.

The following brochure features jurisdiction-specific advice
from 24 firms with expertise in company formations. They guide you through the
various formation vehicles available in their jurisdictions, and offer advice
on regulatory hurdles you need to be aware of, or opportunities you may find
useful. They also discuss various KYC compliance regulations, describing the
best ways to streamline these onerous obligations.

To read the full article, please use the following link: /developments/wp-content/uploads/sites/19/2019/07/5945fa2f9c04291fd03a3ebd39ca2c81.pdf

Contributors

Robert Bron – Owner & Founder, ABiLiTieS Trust www.irglobal.com/advisor/robert-bron

Anne Brady – Partner, Anne Brady McQuillans DFK www.irglobal.com/advisor/anne-brady

Dr. Antonio Ghaleb – Managing Partner, AG & Partners CPA
www.irglobal.com/advisor/dr-antonio-ghaleb

Cees Jan Quirijns – Partner, Athos Group www.irglobal.com/advisor/cees-jan-quirijns

Neelam Rangwala – Director, August Consulting (India)
Private Limited www.augustconsultingindia.com/core-team.html

Roland Jones – CEO & Managing Partner, The Axebridge
Group www.irglobal.com/advisor/roland-jones-aicb-cpa-cga-fca-tep

Dr. Csongor Buzády – Partner, Buzády & Udvari Attorneys
at law www.irglobal.com/advisor/dr-csongor-buzady

Eric Kunkel – Founding Partner, CCK Strategies www.irglobal.com/advisor/eric-kunkel

Kaitlin Flinn – Tax Manager, CCK Strategies www.irglobal.com/advisor/kaitlin-flinn

Glenn Harrigan – Director, CCP Financial Consultants www.irglobal.com/advisor/glenn-harrigan-aca

Yves Lecot – General Manager, Comptafid Benelux NV www.irglobal.com/advisor/yves-lecot

Wolfgang Hohl – Manager, FRTG Group – Franz Reißner
Treuhandgesellschaft www.irglobal.com/advisor/wolfgang-hohl

Richard Ashby – Partner, Gilligan Shepherd www.irglobal.com/advisor/richard-ashby

Christophe Gammal – Managing Director, HALSEY GROUP SARL www.irglobal.com/advisor/christophe-gammal

Trista Wu – Dpt. Managing Partner, HW & Partners,
Barristers & Solicitors www.irglobal.com/advisor/trista-wu

Sean Chen – Senior Partner, HW & Partners, Barristers
& Solicitors www.hwgroup.com.tw/cv/SeanChen

Luis Santine – Partner, InfoCapital N.V www.irglobal.com/advisor/luis-santine-jr

Joanna Bogdańska – Partner, KW Kruk and Partners Law Firm LP
www.irglobal.com/advisor/joanna-bogdanska

Paul Beare – Founder, Paul Beare Ltd www.irglobal.com/advisor/paul-beare

Nick Kelly – Director, Peregrine Corporate Services www.irglobal.com/advisor/nick-kelly

Alex Stolarsky – Partner, Attorney-at-Law, Compliance &
Tax, SCHNEIDER GROUP www.irglobal.com/advisor/alex-stolarsky

Todd Skinner  -Principal,
Skinner + Company, LLC www.irglobal.com/advisor/todd-skinner

Andreas Georgiou – Managing Director, SPL Audit Limited www.irglobal.com/advisor/andreas-georgiou

Frédéric Meunier – Managing Partner and Founder, Squareness www.irglobal.com/advisor/frederic-meunier

Emmanuel Rosec – Partner, Squareness www.squareness.fr/en/team/emmanuel-rosec

Andrea Vasilova – Partner, VASIL & Partners www.irglobal.com/advisor/andrea-vasilova

Dunstan Magro – Managing Partner, WDM International www.irglobal.com/advisor/dunstan-magro

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