The new Law about International business companies on the Seychelles came into force
Within the Global forum FATF and OECD on transparency and exchange of information in the tax sphere, on July 26, 2016 in Seychelles the new law about International business companies was adopted (further in the text – "The new law"). The new law offers tough, but at the same time the attractive regulatory base promoting development of competitiveness and continuation of a strong growth of popularity of the Seychelles as the international center of financial services. Fixing of regulatory aspects of the law, for the purpose of compliance to international standards, reflects interest and observance of Seychelles Republic advanced international experience, in particular, concerning an international initiative on improvement of information openness that will affect reputation of the Seychelles in the opinion of the international community positively. From the moment of adoption of law about International Business Companies, 1994 (further – "The law of 1994"), international business companies have become very successful in the Seychelles in the sector of non-bank financial services.
Despite success of the 1994 Law the Republic of Seychelles has noted the need to improve the activities of international business companies (further – "IBC") and to increase their attractiveness by providing, at the same time, a reliable regulatory framework that meets modern international standards.
Among the main changes which found reflection in the new law about international business companies we will note the following:
- The list of the forbidden types of activity was added. It includes activities related to the securities, investment funds, and activities related to gambling as defined by the applicable laws of the Republic of Seychelles, except where such activity is licensed or otherwise legalized in accordance with the legislation of the country where IBC conducts its activities.
- Every IBC is required to keep a register of end (beneficial) owners of the company and to keep at its registered office in the Seychelles (with the exception of IBC, whose shares are traded on the stock exchange and the subsidiaries of such companies). All IBC (including the company by up to November 1, 2016) have to bring their documents to the new requirements within 12 months from the date of entry into force of the new law (1 November 2016), ie until 31 October 2017.
- Requirements to submit to the registrar of the companies the register of directors will be applied to IBC. All international business companies created according to the Law of 1994 or after entry into force of the New law are obliged to submit to the registrar the register of directors within 30 days from the date of appointment of the first director. Companies created before November 1, 2016, in accordance with the Law of 1994, are required to submit to the Registrar of Companies Register of Directors for a period of 12 months from the date of entry into force of the new law (1 November 2016), ie until October 31, 2017 inclusive. The submitted registers will become publicly available in two years after entry into force of the New law.
Respectively, in case of any changes in the list of directors, the company is obliged to submit to the Registrar of the companies the copy of the register of directors within 30 days from coming into force of changes.
If the company or its director (s) intentionally commits a breach of these provisions of the law and the company and the director (s) will be required to pay a fine of $ 500 each and an additional $ 50 for each day of delay in submission of the information.
- According to provisions of the New law, the company is obliged to store protocols and decisions on a street address of the registered office either in Seychelles, or beyond their limits as it will be determined by directors. In the event that the company does not keep the documents at its registered office in the Seychelles, the company's registered agent must be notified of the place of storage of such documents.
- The procedure for filing the annual report has been changed by the new law. Thus, in accordance with the new requirements, the company must not later than until December 31 following the year of creation or transformation, to transfer the registered agent of the annual report in the form of a declaration.
- The accurate requirements forbidding IBC to issue bearer shares are introduced.
- To deal with a large number of long ready-made companies (shelf companies), introduced a requirement for the appointment of the first director within 9 months from the date of registration of the creation of the company.
- The size of a penalty for general violations and for giving of false information to the Registrar of the companies is increased, so now the size of a penalty constitutes 50 000 US dollars. Also, the new provision by which before imposing a penalty, the Registrar of the companies is obliged to allow interested to express the person the line item in connection with violations was added.
- International business of the company have any more no right to hold the bonds, treasurer bills and other securities issued by the government of the Seychelles or the Central bank of the Seychelles. Also, it is forbidden to sign lease contracts of the real estate for use as office from which communication with participants of the company or where ledgers and reports of the company prepare and stored is made.
- The new law contains provisions that IBC can be held by a vessel registered under the flag of the Seychelles in accordance with the Merchant Shipping Act, and such a vessel may enter or stay in the territorial waters of the Seychelles, provided that the IBC will not hold some related from shipping activities, including, but not limited to, fisheries, shipping or other activities using the vessel.
- A person in respect of which the Registrar of Companies issued a notice of violation shall have the right to challenge such a notice to the Appeals Board, established pursuant to the Regulations on Financial Services (2014), within 90 days from the date of its delivery.
The company Finance Business Service, as before, is ready to provide its services for the creation and maintenance of companies in Seychelles, as well as in other countries. Specialists of our company will provide consultation on the questions interesting you in convenient time. We appreciate your time and money, and our work is directed to operational positive result.