Setting up Offshore in Vanuatu Company Formation Services
Advantages to Incorporate in Vanuatu
Vanuatu has not signed or indicated plans to sign the AEOI (Automatic Exchange of Information) agreement.
Permitted to conduct business worldwide, except within Vanuatu.
Can engage in various businesses in accordance with Vanuatu International Companies Act Cap.222, except in restricted sectors like banking and insurance.
Company names may end with terms like Limited, Incorporated, Corporation, Sendirian Berhad, Responsabilite Limitee, Gesellschaft mit beschrankter Haftung, Besloten Vennootschap, or their abbreviations.
Directors and shareholders can be individuals or corporate entities, with no specific residence or citizenship requirements. A minimum of one director and shareholder is needed, and one person can serve both roles.
Meetings of directors and shareholders can be conducted anywhere and through various means, such as telephone, facsimile, and electronic methods.
No specific minimum authorized capital is required.
Fixed government fees, regardless of the capital amount.
Options for companies to be limited by shares, guarantee, or both.
Allows bearer shares but must be held by an authorized custodian, not the owner.
No mandatory financial statement audits.
No annual returns or filings required, except for the constitution filed with the Commission Registry, and the company’s statutory registers are maintained solely with the regulated agent.
No need to file with government authorities regarding company structure.
High level of privacy and confidentiality, protected by the International Companies Act No.32 of 1992.
Vanuatu has not signed international Tax Information Exchange Agreements (TIEA) with countries such as PRC, HK S.A.R., and Macau S.A.R.
No formal channels for tax information exchange have been established.
Vanuatu’s government has shown no intention to enter such agreements to maintain the high level of tax privacy for international companies.
Currently on the “Whitelist” of the OECD, indicating substantial compliance with internationally agreed-upon tax standards.
General Information
- Vanuatu is an archipelago of approximately 80 islands located in the South Pacific, situated between Australia and Fiji.
- The nation spans from latitudes 13° to 21°, with a tropical to sub-tropical climate.
- Total land area is around 12,190 square kilometers.
- Port Vila, on the island of Efate, serves as the capital.
- The population is approximately 333.877 (2023).
Political Structure
- Vanuatu is a parliamentary democracy and a Republic.
- It gained independence from the Anglo-French Condominium of the New Hebrides in 1980.
- The President serves as the head of state, with mainly titular powers.
- The single-chamber legislature consists of a 52-member parliament.
Infrastructure and Economy
- Vanuatu has two international airports and offers regular flights to Australia, New Zealand, and nearby islands.
- The economy comprises both a subsistence agricultural sector and a monetized sector based on plantations, ranches, trade, manufacturing, banking, and tourism.
- Key economic activities include copra, beef, cocoa, timber, coffee, and fishing.
- The offshore financial sector, established in 1971, significantly contributes to government revenue and offers employment opportunities.
Language
- Official languages include English, French, and Bislama (pidgin). In the financial sector, English is predominantly used.
Currency
- The official currency is the Vatu (Vt).
Exchange Control
- Vanuatu has no exchange controls. Major currencies can be deposited and repatriated freely.
Type of Law
- Vanuatu operates under a Common Law system. British laws from the pre-independence period continue to apply unless expressly revoked or incompatible with the Republic’s independent status.
Principal Corporate Legislation
- Corporate operations are governed by the Companies Act (Cap 191), the International Companies Act (1993), and the Banking, Insurance, Stamp Duties, and Trust Companies Acts.
- The International Companies Act imposes a solvency test on International Companies, making directors personally liable for any shortfall. The Financial Services Commissioner administers this framework.
Incorporating in Vanuatu
Company Information
Types of Companies for International Trade and Investment
For international trade and investment purposes, one can opt for either a Vanuatu Exempt Company incorporated under the Companies Act (Cap 191) or a Vanuatu International Company, abbreviated as “IC,” incorporated under the International Companies Act 1992 (No. 32). The International Company offers enhanced flexibility and reduced compliance requirements.
Incorporation Process
To initiate the process of company formation in Vanuatu, the company is required to submit a copy of its constitution to the Financial Services Commission. The constitution includes essential details such as the company’s name, its permissible purposes (which can be general), the official office address, and the agent’s name, both of which must be located within Vanuatu. Additionally, the company must specify whether it is limited by shares or guarantee. The Vanuatu Financial Services Commission issues two copies of the Certificate of Incorporation.
Trading Restrictions
Both International and Exempt Companies are prohibited from engaging in trade within Vanuatu or owning real estate in the country. Vanuatu International Companies are further restricted from conducting activities related to banking, insurance, assurance, reinsurance, fund management, the management of collective investment schemes, the provision of investment advice, or any other activities that imply an association with the banking or insurance sectors.
Corporate Powers
Exempt Companies derive their powers or objects clauses from their Memorandum of Association, which are usually drafted to encompass general powers. In contrast, International Companies possess the authority to engage in any lawful activity, except those explicitly restricted by the International Companies Act.
Language of Legislation and Corporate Documents
All legal and corporate documents are typically in the English language. Foreign translations of these documents can be arranged for a fee.
Registered Office Address Requirement
Vanuatu Companies are mandated to maintain a registered office address within Vanuatu.
Shelf Companies Availability
Shelf companies in Vanuatu are accessible for use.
Timeframe to incorporate in Vanuatu
The process of incorporation is typically completed within two days.
Name Restrictions
Specific name restrictions are imposed to prevent names that are identical or suggest an association with a foreign government, a public or international organization, or a municipal authority. Additionally, names that may be considered generally undesirable or obscene may be disallowed based on policy grounds.
Language of Company Names
Vanuatu International Company names are not limited to any particular language and can utilize characters or alphabets from different languages, such as Chinese, Japanese, Russian, and Arabic.
Names Requiring Consent or License
Names that imply associations with banking, building societies, insurance, assurance, reinsurance, fund management, investment funds, trusts, trustees, or finance, and their foreign language equivalents, typically require consent or licensing.
Suffixes Denoting Limited Liability
Exempt Companies are mandated to incorporate the term “Limited” in their names to indicate limited liability. International Companies, on the other hand, have the flexibility to use a wide range of internationally accepted abbreviated words as suffixes to denote their limited liability status.
Vanuatu Opening Offshore Company
Compliance
Authorized and Issued Share Capital
For an Exempt Company, the standard authorized share capital is typically set at US$ 10,000. In contrast, most International Companies are not obligated to specify an authorized capital, as this requirement is absent from the governing Act. Both Exempt and International Companies are free to express their capital in any currency.
Permissible Share Classes
Permitted classes of shares include officially filed shares, preference shares, redeemable shares, as well as voting and non-voting shares.
Taxation
Exempt and International Companies in Vanuatu are exempt from domestic taxation on their net chargeable profits.
Double Taxation Agreements
Here are currently no double taxation agreements in place.
Annual Franchise Taxes
International Companies in Vanuatu are subject to an annual franchise tax of US$300. Exempt Companies, on the other hand, are required to pay a minimum annual fee of US$450. It’s worth noting that this fee may increase if the company has a high authorized capital.
Financial Statements
- There is no requirement for Vanuatu International Companies (VIC) to file accounts, while Exempt Companies must file accounts only if licensed.
- Both types of companies must maintain accounts to reflect their financial position.
Directors
- At least one director is required for both Exempt and International Companies.
- Directors can be natural persons or corporate bodies, with no specific nationality or residency requirements.
- Exempt Companies must have at least one resident director.
Company Secretary
Exempt Companies must appoint a company secretary, while International Companies are not required to do so, although it is customary to facilitate signing requirements.
Shareholders
International Companies require a minimum of one shareholder, whereas Exempt Companies need at least two.
Vanuatu International Company
Key Corporate Features
General
- Type of Company: International
- Shelf Company Availability: Yes
- Time to Establish a New Company: 2 days
- Political Stability: Good
- Disclosure of Beneficial Owner: No
- Migration of Domicile Permitted: Yes
- Corporate Taxation: Nil
- Double Taxation Treaty Access: None
- Language of Name: Various, including Latin and other alphabets
Corporate Requirements
- Minimum Number of Shareholders/Members: One
- Minimum Number of Directors/Managers: One
- Corporate Directors/Managers Permitted: Yes
- Company Secretary Required: No
- Usual Authorized Capital: None
Local Requirements
- Registered Office Address/Agent: Yes
- Company Secretary: No
- Local Directors: No
- Local Meetings: No
- Government filing of Directors/Managers: No
- Government filing of Shareholders/Members: No
Annual Requirements
- Annual Return: No
- Annual Return Filing Fee: No
- Annual Audit: No
Recurring Government Costs
- Minimum Annual Tax / License Fee: US$300
- Annual Return Filing Fee: Not Applicable
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