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MARSHALL ISLANDS COMPANY FORMATION
The Marshall Islands is a popular jurisdiction for offshore company formation due to its favorable tax system and business-friendly environment. The Marshall Islands has become a preferred destination for entrepreneurs and businesses looking to establish a presence in the Pacific region.
The process of company registration in the Marshall Islands is straightforward and can be completed relatively quickly. Company registration in the Marshall Islands is governed by the Marshall Islands Company Registry.
KEY REQUIREMENTS FOR COMPANY REGISTRATION IN THE MARSHALL ISLANDS
TIMELINE OF COMPANY INCORPORATION IN THE MARSHALL ISLANDS
1 TO 3 WEEKS
3 TO 4 WEEKS
Directors and shareholders
A minimum of one director and one shareholder is required to form a company in the Marshall Islands. They can be individuals or corporate entities and can be of any nationality or residency.
Marshall Islands company formation requires the appointment of a company secretary. The secretary can be an individual or a corporate entity and can be of any nationality or residency.
The company must issue shares and the share capital can be denominated in any currency. The number and value of shares issued will determine the ownership structure of the company.
There is no minimum share capital requirement for companies in the Marshall Islands. Companies can issue shares at any value, and the share capital can be paid up or unpaid.
Every company registered in the Marshall Islands must appoint a registered agent who is authorised to receive legal and official documents on behalf of the company.
Depending on the nature of the business, the company may require additional licences or permits before it can begin operations.
BUSINESS TYPES IN THE MARSHALL ISLANDS
INTERNATION BUSINESS COMPANY
In the Marshall Islands, the international business company is the most common legal structure. It is forbidden for the IBC registered in Martial Island to conduct business with their people or the businesses they have founded. However, they can continue to work professionally with accountants, trust businesses, managers, secretarial firms, financial advisers, and other organizations that are involved in their fields. IBCs are not subject to any local taxes of any kind.
In this kind of business, the Marshall Islands Act permits it to maintain its initial registration date while still registering itself in another jurisdiction. Companies may move their domicile to the Marshall Islands under the authority of the Marshall Islands Business Corporation Act. The legal foundation for domiciliation was taken from Delaware law in the United States.
In the Marshall Islands, it is easy and practical to establish these types of entities. It is also simple and convenient to manage these types of entities. This sort of company can be established online and includes a standard memorandum act, which is relatively quick to draft. There is no minimum requirement for directors or shareholders.
LIMITED LIABILITY COMPANIES
The limited liability company agreement, or LLC agreement, which specifies how the LLC will be run, is not required to be made public but the certificate of incorporation should be made public. The LLC agreement can choose to opt out of otherwise applicable statutory LLC law in numerous situations, giving LLCs much greater freedom than a corporation. An LLC may be owned by a single person, unlike a partnership.
A certificate of limited partnership must be filed publicly, much like an LLC. Due to the requirement of having one or more general partners who are responsible for the general partnership’s debts and obligations and one or more limited partners who are not liable for the limited partnership’s debts and obligations, an unlimited partnership has a slightly more complicated structure than an LLC. In comparison to an LLC, several foreign jurisdictions feel more at ease conducting business with partnerships.
DOCUMENTS REQUIRED FOR MARSHALL ISLANDS COMPANY FORMATION
- Apostille Certificate of Incorporation
- Articles of incorporation
- Consent of Incorporator
- power of attorney
PROCESS OF REGISTERING A COMPANY IN THE MARSHALL ISLANDS
- Choose a company name – Select a unique name for the company that is not already registered in the Marshall Islands. Determine the most appropriate entity type as per the business needs, such as an International Business Corporation (IBC), Limited Liability Company (LLC), or another form of entity.
- Prepare and file the necessary documents – Prepare and file the required documents with the Registrar of Corporations, including the Articles of Incorporation, Bylaws or Operating Agreement, and other relevant forms and certificates as listed above.
- Appoint a registered agent – Appoint a registered agent in the Marshall Islands who can receive legal and official documents on behalf of the company.
- Obtain any necessary licenses and permits – Depending on the nature of the business, the applicant may need to obtain additional licences and permits from relevant authorities in the Marshall Islands.
- Obtain a tax identification number – Register with the tax authorities in the Marshall Islands to obtain a tax identification number (TIN) for the company.
- Open a bank account – Once the company is registered, the applicant can open a bank account in the Marshall Islands to conduct business. Refer to the Marshall Islands corporate bank account opening for more information.
ANNUAL REQUIREMENTS FOR THE MARSHALL ISLANDS COMPANY REGISTRATION
All that is needed to renew a Marshall Islands company registration and keep it in good standing is to pay the Annual Corporation Maintenance Fees to the government and registered agent. These fees are due on the anniversary of incorporation and cover the costs of the registered office, registered agent, and government.
There is no need for an organisation registered in the Marshall Islands to submit Accounting Records to the government because such a firm is not permitted to conduct business there. A Marshall Islands firm is required by law to maintain records of its finances to show its financial standing.
A corporation registered in the Marshall Islands is only required to pay one renewal charge each year.
All Marshall Islands companies are required to submit a yearly report on their economic substance status.
PROS AND CONS OF REGISTERING A BUSINESS IN MARSHALL ISLANDS
Offshore businesses that are registered in this jurisdiction are exempt from the profit tax. Additionally, dividends are not taxed.
Bearer shares may be issued and kept anywhere in the Marshall Islands. Companies that issue bearer shares, however, will face challenges when trying to create bank accounts abroad.
In the Marshall Islands, there is no public registry of shareholders, corporation directors, or other beneficiaries. The rivals won’t get a chance to find out about the offshore business. The Marshall Islands automatically share resident fiscal data with some other nations at the same time.
Easy business formation:
It is simple to register an offshore company in the Marshall Islands with one shareholder and one director.
Limited Physical Presence:
The Marshall Islands have limited infrastructure. This makes it difficult for businesses to establish a local presence.
The Marshall Islands has a relatively small workforce. This makes it difficult for businesses to find qualified employees.
Limited Banking Services:
The banking sector in the Marshall Islands is small. There are limited banking services available for businesses.
Reach out to us at Relin Consultants for our Marshall Islands company incorporation services.
Are the Marshall Islands Offshore?
Yes, the Marshall Islands is regarded as an offshore territory. It also provides many tax advantages to businesses. The Marshall Islands have additionally received the label of “non-cooperative tax jurisdiction” by some nations, indicating that it does not entirely adhere to international tax rules.
Why do companies register in the Marshall Islands?
The Marshall Islands provide benefits such as a stable political climate, a thriving financial services industry, and a business environment that is tax-friendly. The Marshall Islands have a progressive and adaptable corporate law system that enables the creation of international business corporations (IBCs) that provide their owners with a number of advantages.
Do businesses in the Marshall Islands pay taxes?
There is no corporate income tax system in place in the Marshall Islands. Companies may have to pay taxes in the nation where their money is generated.
Is a Marshall Islands corporation required to have a company secretary?
A Marshall Islands corporation is required to select a company secretary, who may be a natural person or a body corporate. The corporate secretary may be from any country and reside anywhere.
Which businesses are prohibited in the Marshall Islands?
In the Marshall Islands, any inland commercial operations by an IBC are illegal. A Marshall Islands firm cannot be used to conduct banking, trust services, insurance, assurance, reinsurance, or gambling activities.
What are the preliminary conditions for forming a business in the Marshall Islands?
You must provide the following information to incorporate an international business company in the Marshall Islands:
- a minimum of one shareholder and one director, who may be the same person.
- a Marshall Islands local address used for registration.