Moore Stephens Offshore Companies

LEGAL BACKGROUND

Gibraltar’s legal system is based on English Common and Statute Law, with variations introduced by local ordinances. As an associate member of the European Union it also implements EU directives, including those in the area of financial services.

All companies registered in Gibraltar are governed by the Companies Ordinance 1930 which is based on the United Kingdom Companies Act 1929 and has subsequently been updated through later Ordinances. The law allows for the formation of companies with both limited and unlimited liability, private and public status and for the registration of branches of companies incorporated outside Gibraltar.

Gibraltar companies must have a minimum of one shareholder who may be corporate or individual. Details of shareholders appear on the public file but anonymity can be preserved by the use of nominee shareholders.

Gibraltar companies must have a minimum of one director who may be corporate or individual. Details of the directors appear on the public file.

An annual return must be filed each year showing details of shareholders and directors.

Companies can normally be incorporated within two days but on payment of a premium the incorporation time can be reduced to twenty-four hours. Ready-made companies are available for immediate purchase.

The company must maintain a registered office address within Gibraltar, and in certain circumstances, a Gibraltar resident company secretary has to be appointed.

Accounts have to be filed annually. In most circumstances, abridged accounts can be filed and the rules are the same to the uk

When using nominee services, details of the beneficial owners of Gibraltar companies do not have to be revealed. On application for Exempt status (see below) the application must be accompanied by references on the beneficial owners. These details do not form part of any public record and section 14 of the Companies (Taxation and Concessions) Ordinance imposes a statutory duty of secrecy upon any official who is in receipt of those details.

TYPES OF GIBRALTAR COMPANIES

New Tax exempt companies are still available in limited circumstances until 31 December 2007. Existing tax exempt companies will continue to benefit from their tax exempt statuus until 31 December 2010, as agreed recently with the European Commission. New applications can be made until 30 June 2006. The fee for applcation is now £450, and the annual fee, which runs to 31st March each year, is also £450. This status permits companies to operate from a head office in Gibraltar in any legitimate activity which does not involve trade with Gibraltar residents or companies, without incurring the usual 35% corporate rates of taxation (20% for small companies).

This company was specifically created to take advantage of European Union Directive 90/435. This Directive states that dividends paid between a subsidiary company and a parent company, both of which are located in EU states do not have to withhold tax as long as the recipient parent company is not capable of being exempt from tax. The prohibition against tax exemption would mean that the exempt and non resident Gibraltar companies are not suitable to receive dividends from a subsidiary in another EU state, so the 1992 Holding Company was created. The 1992 Holding Company pays 35% tax on all profits except on dividend income received. Dividends paid out of the 1992 Holding Company are subject to a 1% withholding tax. This type of company can be particularly advantageous for non EU countries who are investing within the EU and are expecting to receive dividend income.

Investment and property holding: the beneficial owner may be able to avoid capital and inheritance taxes otherwise payable if such investments were held directly.
Trading: companies may be operated for many commercial purposes in a tax exempt environment.
Invoicing: the invoicing of services by a Gibraltar company to another in a different country may enable the Gibraltar company to retain a proportion of the profits, tax free, for the services it renders.
Employment: individuals subject to high personal taxation who earn income outside their country of residence, may contract their services to a tax exempt Gibraltar company.
Intellectual property rights: trade marks, patents, royalties and other rights can be held by a tax exempt Gibraltar company which can profit from leasing them.

Moore Stephens can incorporate and administer companies incorporated in most other jurisdictions.

FIRST ROCK TRUSTEES LIMITED

First Rock Trustees Limited is licensed by the Gibraltar Financial Services Commission to provide company, ordinary trust and asset protection trust management services.

Cindy Glasby - Legal Compliance Officer – email: cindy.glasby@moorestephens.gi MS

We believe the information to be correct at the time of going to press but we cannot accept responsibility as a result of acting or refraining from acting as a result of any item herein.