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Offshore Fundamentals

What is an Offshore Company?

In its simplest definition, an offshore company is essentially the same as any other company. However, an offshore company is a company incorporated outside the country of residence or domicile of its primary operations. For instance, a U.K. registered company may incorporate an offshore company in the BVI, the Cayman Islands, Samoa, Seychelles, and so on. An offshore company usually has a low- or zero-tax rate and is specifically used for international, cross-border purposes. It is usually not permitted to engage in business within the jurisdiction which is its primary base.

Common and Tangible Uses of Offshore Companies

The principal drivers for the use of offshore companies are the underlying trade and financial flows within the economy. There are many uses that individuals and corporations apply to offshore companies. Some common uses are trading, investment, property & asset holding, estate & succession planning, financing, listing on international stock exchanges and acquisition transactions.

Offshore companies are used for a diverse range of reasons, taking advantage of:

  • Simpler prudential regulatory frameworks that reduce business costs
  • Reduced burdens for incorporation
  • The existence of adequate legal frameworks that safeguard the integrity of principal-agent relations
  • The proximity to major economies or to countries attracting capital inflows
  • The reputation of specific offshore jurisdictions and the availability of specialist services required
  • Freedom from currency exchange controls
  • A means of safeguarding assets from the impact of litigation, sovereign risks and local/religious laws
  • Potentially lower explicit taxation and consequentially increased income after tax

Popular Offshore Jurisdictions

The BVI has historically been the most popular jurisdiction for investment holding purposes. Samoa and Anguilla companies are increasingly used for investment holding too. Seychelles is used for investments routed to Africa, and Mauritius for investments routed to India. For investors considering an IPO or setting up mutual funds, Cayman Islands companies have been the usual choice.

Learn more details on the various jurisdictions and their features.

Offshore Fundamentals Training Program

As the leading global company formation specialist providing company formation services and ongoing management of offshore companies, we are committed to provide value-added services to our clients. A part of this commitment is the “Offshore Fundamentals Training Program” (the “Offshore Fundamentals”) for our clients which we launched in 2010.

Offshore Fundamentals is delivered by specialist Trainers fluent in Cantonese, Mandarin and English. With more than 10 years’ experience in dealing with professional clients in Asia, the Trainers are well versed in matters such as investment holding, IPO, and wealth planning structures.

Since time is money, Offshore Fundamentals emphasizes the practical rather than the academic aspects of the training program. The program is designed for participants to gain insights and some fundamental knowledge of the offshore industry as well as the opportunity to explore the more common use of offshore companies and other applications. The ultimate goal is to help our clients develop new business strategies and, by empowering their staff, in turn the staff would serve their clients better.

Offshore Fundamentals can be tailored according to your needs and conducted at your office premises, if preferred. The program is normally conducted for 3 hours* with 10 participants as the minimum class size. Trainers are available across all markets in Asia. An example of the course outline:

  • Overview of offshore financial business
  • Common uses of offshore companies
  • Setting up and maintaining an offshore company
  • Popular offshore jurisdictions and their common usage
  • Case study

Should you be interested in this training program for your staff, please contact your OIL Account Manager. If you are a professional institute wishing to include Offshore Fundamentals in CPD courses to your members, please contact us.

*Depending on the level of the participants, the training length can be shortened to 1 hour or extended to 1 full day of 8 hours.