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Seychelles

Seychelles Offshore Company Formation

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The Republic of the Seychelles is an archipelago of 115 tropical islands located in the Indian Ocean about 1,600 kilometres (1,000 miles) east of Kenya, northeast of Madagascar. Until the 17th century the islands were uninhabited, the territory then became the subject of a struggle between the French and the British which culminated in the Islands being officially ceded to Britain in 1814 and taking the status of a British Colony in 1903. The Seychelles gained its full independence in 1976 and is a member of the Commonwealth.

The legal system in the Seychelles is based on English Common law, French civil law and customary law. The Companies Law 1972, which emulates English law, governs the formation of domestic company types such as the Public company, private company limited by shares or guarantee.

Offshore entities can take several forms i.e. the Limited Life Company, Limited Partnerships or Special Licence Company. Most offshore businesses are International Business Companies (IBC) incorporated under the International Business Companies Act 1994.

Offshore Company Formation

Advantages of the Seychelles Offshore Company Formation

Business Formation expertise
Charges
Secrecy
Banking services
Legal system
Political stability
Prestige


offshore fee schedule

The Seychelles International Business Company is exempt from local taxation, business profits are only taxed if they are derived or deemed to be derived from a source in the Seychelles. IBC are also exempt from withholding taxes and Stamp Duty.

The government actively encourages the development of offshore business and investment and has created an industrial Free Trade Zone in the principal Island of Mahe. Businesses established in the Zone receive exemptions from custom duties and Social Security Contributions and concessions in respect of the employment of foreign labour and the accessibility of work permits.

The Jurisdiction is politically stable, with good air and sea transport links and modern telecommunications. There are no exchange controls but transactions in foreign currency must be through an authorized dealer. There is an adequate level of secrecy in professional transactions, but disclosure can be ordered by the courts in a number of international agreements and on the suspicion of criminal activity.

The incorporation process takes no more than one to two days with an additional wait for the documentation.

IBC Company Formation Formalities in the Seychelles

The International Business Company usually takes the form of a private company limited by shares and as with most jurisdictions the Seychelles IBC is granted subject to certain stipulations:
  • The IBC must refrain from business activities with residents of the Seychelles;
  • The IBC must not hold any interest in Seychelles real property but property may be leased for office use only;
  • Insurance, re-insurance, Banking or Trust business is permitted only if an appropriate licence is issued;
  • An IBC is strictly prohibited from undertaking the business of company management or providing registered facilities for Seychelles-incorporated companies.
Minimal IBC company formation requirements:
  • The minimum number of directors and one shareholders required are one; a director may be a natural person or a body corporate;
  • There is no requirement to appoint a Company Secretary but it is the practice to do so, Shareholders, directors and officers need not be resident in the Seychelles and there is no stipulation as to their nationality;
  • There is no minimum capital requirement but IBC’s are normally incorporated with an authorized share capital of US$ 5,000 of no par value which is the maximum for the minimum licence fee;
  • The permitted classes of shares may be either registered or bearer, shares of no par value, redeemable shares and shares with or without voting rights and may be issued in any currency;
  • A registered office address must be maintained within the Seychelles and a local resident appointed as a registered agent;
  • There is no requirement to file accounts but records must be kept to reflect the financial position;
  • Shareholders and directors meetings need not be held in the Seychelles and can be held by telephone;
  • There is no requirement for the disclosure of beneficial ownership. The Memorandum and Articles of Association are the only documents to be held on the public record.
Trusts

There are no domestic Trusts in the Seychelles; the International Trusts Act 1994 allows for the creation of International Trusts only. Such Trusts can be created in writing, by will or by oral declaration; deemed trusts are admitted, as are those resulting from a decision of the Court. The settlor must reside outside the Seychelles for the duration of the trust; at least one trustee must reside in the jurisdiction, an IBC may be a settler. The trust property may not include any Seychelles movable or immovable property. The names of settlors and beneficiaries are confidential under the Act, unless a Court orders disclosure under the Anti-money Laundering Act. The standard perpetuity period is 100 years.

An International Trust is exempt from tax in the Seychelles and a registration fee is payable.

Taxation

In the Seychelles there is no taxation of an individual’s income, but social security contributions are payable by the employer and employee at a rate of up to 40% on income which in effect is an income tax. There are no capital gains taxes, gift, property or estate taxes. VAT was introduced in 2003.

Business tax is levied on all income received by a sole trader, partnership, Trust estate or company on profits derived or deemed to be derived from a source in the Seychelles. IBC’s are exempted from business tax, stamp duty and withholding tax but are liable for Social Security contributions of their employees salaries unless established in the International Trade Zone then the IBC receives an exemption from this tax. All IBC’s must pay an annual renewal licence fee to guarantee IBC status.

Dividends, interest and royalties, which mostly bear withholding tax if paid to non-residents.

Banking

All offshore Banks must be licenced. There are currently five licensed foreign banks in the Seychelles, and two domestic banks.

All licensed offshore (non-domestic) banks are exempted from Seychelles taxes and duties for a 20 year period from the date the licence was granted, although a non-domestic bank may elect to pay business tax in the Seychelles on its taxable income as agreed with the Commissioner of Taxes.

Employment Law

The employment market is quite closely regulated, about 88% of the adult population in the Seychelles is literate and with the increasingly sophisticated requirements of the international businesses much employment legislation is to improve the skill levels and protect the local work-force by restricting the influx of foreign workers.

Geography, People Language and Culture

The Seychelles are approximately 445 sq km (177 sq mi) the three central islands Mahe Praslin and La Digue are granite, while the outlying islands are coral atolls. The climate is tropical and subject to marine influences; there is a cooler season from late May to September and warmer from March to May.

The population is approximately 80,832 (est. July 2004). 90% of the population inhabit the principal Island of Mahe. The capital city is Victoria on the island of Mahe and is one of the smallest capital cities in the world and the only major port in the Seychelles. There is no indigenous culture in the Seychelles as such the ethnic groups are mixed; French, African, Indian, Chinese, and Arab. Seselwa- French/African Creole is the language of 94% of the people, English and French are commonly used and English is the language of government and commerce.

The predominant religion is Roman Catholicism which is practiced by 86% of the population.

The Seychelles has four marine national parks, and more than 150 species of tropical reef fish have been identified. Dolphin and porpoise are common between the islands, shark and barracuda and the Seychelles is renowned for game fishing.

Immigration and Residency

Visas are not required for visitors to Seychelles;on production of as onward ticket, booked accommodation and sufficient funds for your stay, a one month Visitor's Permit (extendable on application) will be issued. Short-stay visas are issued freely on arrival, although evidence of financial support may be required. For longer stays, it will be necessary to demonstrate adequate financial resources, or to acquire a Gainful Occupation Permit.

Seychelles Legal and Political System

In the 1960’s political parties developed in the Seychelles and Socialist rule was brought to a close with a new constitution and free elections in 1993. There are three branches of state: the Executive, headed by a President who is the chief of state and head of government and is elected by popular vote for a 5-year term; the Legislative--unicameral National Assembly with 34 seats, 25 directly elected and 9 allocated on a proportional basis. The Judicial branch includes a Court of Appeal and Supreme Court; judges for both courts are appointed by the president. The political parties in the Seychelles are the Democratic Party (DP), Seychelles National Party (SNP), and Seychelles People's Progressive Front (SPPF).

The most recent presidential elections were held 31 August-2 September 2001. President Rene, who has served since 1977, was re-elected. Seychelles citizens can vote at the age of 17 years.

Economy

The official unit of currency is the Seychelles Rupee (SCR). The black market value of the Seychelles rupee is half the official exchange rate.
Tourism is one of the most important sectors of the economy and accounts for 73% of the GNP. Employment, foreign earnings, construction, banking, and commerce are all dominated by tourism-related industries. Industry accounts for 24% which covers fishing; processing of coconuts and vanilla, coir (coconut fiber) rope, boat building, printing, furniture; beverages and agriculture accounts for 2.4% of GNP.

Legislation relating to offshore and non-resident business


Civil Aviation Act 1996
Companies Law 1972
Companies (Special Licence) Act, 2003
Financial Institutions Act 1984
Insurance Act 1994
Insurance (Non-Domestic Insurance Business) Regulations 1996
International Business Companies Act 1994
Interactive Gambling Act 2003
International Corporate Service Providers Act 2003
International Trade Zone Act 1995
International Trade Zone Regulations 1995
International Trusts Act 1994
Investment Promotion Act 1994
Limited Partnership Act, 2003
Merchant Shipping Act 1992
Mutual Assistance in Criminal Matters Act 1995
Mutual Funds Act 1997
Protected Cell Companies Act, 2003
Seychelles International Business Authority Act 1994
Companies (Special Licence) Act, 2003


 
 
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