Seychelles is not just a tropical paradise but also an emerging hub for international business. The Seychelles International Business Company (IBC) is popular with investors and businesses seeking a favourable offshore jurisdiction. This article highlights the benefits, requirements and incorporation processes of an IBC.
- Seychelles IBCs can be incorporated within 24 to 48 hours.
- There is no minimum capital requirement.
- Foreign-sourced income is not taxed if structured correctly.
- Seychelles IBC cannot engage in activities such as banking, insurance, securities and gambling unless legally allowed outside of Seychelles.
International Business Company overview
Seychelles enacted legislation in December 1994 (Amended in 2016) to facilitate the registration of IBCs and International Trusts and the licensing of International Trade Zone Companies. The laws governing Seychelles IBCs are influenced by global offshore studies and are designed to provide an attractive and modern framework for offshore companies.
Seychelles IBCs are suitable for a variety of international business purposes, including offshore banking, insurance, mutual funds and securities regulation. Additionally, the legal framework for Seychelles IBCs is known for its comprehensiveness and efficiency.
Benefits of a Seychelles IBC
- Taxation: The jurisdiction does not impose corporate income and capital gains tax on passive foreign-sourced income.
- Limited liability: An IBC has the same powers as a natural person.
- Confidentiality: Details of beneficial owners and shareholders are not publicly disclosed.
- Ease of formation: Seychelles IBC is one of the world’s fastest registration processes, emphasising simplicity and efficiency for businesses seeking to establish themselves in this offshore jurisdiction.
- No minimum capital requirements: There are no minimum capital requirements for Seychelles IBCs, making it accessible for small and medium-sized enterprises.
- Stamp duty: No stamp duty imposed on the transfer of IBC shares.
According to the International Business Companies Act 2016, an IBC is a company that shall not:
- Engage in banking business as defined in the Financial Institutions Act in or outside Seychelles.
- Carry on insurance business as defined in the Insurance Act in Seychelles or, unless it is licensed or legally able to do so under the laws of the country it carries on such business outside Seychelles.
- Provide international corporate services, international trustee services or foundation services as defined in the International Corporate Service Providers Act except to the extent permitted by the Act and, when operating outside Seychelles, only if legally authorised in each relevant foreign country.
- Conduct securities business as defined in the Securities Act in Seychelles or, unless it is licensed or legally able to do so under the laws of the country it carries on such business outside Seychelles.
- Operate a mutual fund as defined in the Mutual Fund and Hedge Fund Act unless it is licensed or legally able to do so under the Act or the laws of a recognised jurisdiction as defined in the Act.
- Establish a gambling business as defined in the Seychelles Gambling Act, 2014 , including interactive gambling business, in or outside Seychelles unless it is licensed or legally able to do so under the laws of the country it carries on such business.
Requirements for setting up an IBC in Seychelles
Directors and shareholders
The IBC requires a minimum of one director and shareholder, who may be a natural person or body corporate and of any nationality.
A company secretary is not mandatory; however, it is recommended to appoint one. The company secretary may be a natural person or body corporate and of any nationality.
Company name language and restrictions
The name of an IBC can be in any language, however, must be accompanied by a translation of English or French.
The company name must end with Limited, Corporation, Incorporated, or abbreviations Ltd, Corp, or Inc. The name of a protected cell company shall end with the words Protected Cell Company or with the abbreviation PCC.
Name restrictions for an IBC are:
- Avoid names identical or similar to existing companies.
- Refrain from suggesting patronage by the Government of Seychelles or any other government.
- Do not include prohibited words, phrases, or abbreviations such as Assurance, Bank, Chamber of Commerce, Cooperative, Insurance, Trust, Foundation, or a word with a similar meaning.
Language of legislation and corporate documents
The language of legislation and corporate documents for IBCs must be either English or French. If another language is used, a translation in French or English must be provided.
A registered office is required and it must be in Seychelles at the same address as its registered agent.
Minimum capital requirement
There is no minimum authorised capital requirement for a Seychelles IBC and can be incorporated with a capital of USD 1.
IBC incorporation process
- Obtain prior approval for the company name. The name availability can be checked and reserved via the Seychelles Financial Services Authority Company Search.
- Following a request for incorporation, the registrar will reserve and issue a unique company registration number to the proposed IBC.
- Within three days, the International Corporate Service Providers (ICSP) must submit at least three copies of the company’s Memorandum and Articles of Association to the Registrar.
- The Registrar will then issue the Certificate of Incorporation.
How long does IBC incorporation take?
One of the attractive features of Seychelles IBCs is the fast incorporation process, taking just 24 to 48 hours.
- Government licence fee: IBCs are subject to a licence fee of USD 140 upon registration and annually. This fee applies to all IBCs, irrespective of their authorised capital, paid-up capital, or number of shares.
- Taxation: Passive Foreign-sourced income is not subject to taxation. Seychelles follows a territorial tax system, meaning that only income sourced within Seychelles is taxed. Active foreign sourced income is taxable where the company creates a PE. MNE’s have a different taxation regime.
- Accounting records: IBCs must keep their accounting records for at least seven years from completion and submit them bi-annually to the company’s registered office in Seychelles, with records for the first half due by July and those for the second half by January of the following year. However, the authorities may request records at any time, which should be made available within seven working days.
- Classes of shares permitted: A Seychelles IBC can issue shares in various forms and classifications, including par value share, no par value share, voting rights, no voting rights, preferential, common and redeemable. Additionally, the issuance of shares is not restricted to a specific currency. However, it is important to note that bearer shares are not permitted.
Seychelles IBCs are attractive for businesses seeking an offshore jurisdiction with a business-friendly environment, tax advantages and strong privacy protections. While certain trading restrictions apply, the permitted business activities ensure that Seychelles IBCs can cater to a wide range of business objectives.
Set up and manage a Seychelles IBC with Acclime
Acclime is a leading professional services firm that can help navigate the complexities of international business, especially the establishment and management of entities like Seychelles IBCs. With our corporate services expertise, Acclime can support businesses looking to leverage the advantages of offshore jurisdictions. Our team of professionals understand the intricacies of Seychelles’ regulatory landscape, ensuring seamless compliance with local laws and regulations.