Seychelles as a modern international business hub
According to international experts, there are more than 70 specialized areas and countries worldwide that possess the offshore zone status. In addition, there are numerous jurisdictions and administrative-territorial units that are not the classical offshores but also provide international business with tax and customs privileges.
Despite the growing criticism of such international financial centres by the governments of many highly developed countries, the volume of transactions in the offshore areas remains considerable. The overall current situation on the international arena and strengthening fight against the offshore jurisdictions in particular, create some limitations and inconveniences for businessmen and entrepreneurs. However, all the difficulties are covered by the offered advantages and opportunities for carrying out a tax-free international business.
Seychelles Islands: the region’s largest financial centre
It should be noted that such traditional offshore zones as the Bahamas, the Cayman Islands, Luxembourg, Panama, Cyprus and jurisdictions of the Caribbean Basin are the most popular places for developing international offshore financial schemes.
At the same time, the relatively recently appeared tax-free jurisdictions are gaining incredible popularity. Such jurisdictions usually make use of the best international practices and have considerable potential. The Republic of Seychelles is worth to be singled out among the numerous relatively new territorial entities that are used for developing the offshore business.
This offshore jurisdiction was created in the 90-ies of the last century. Today, the country possesses the advanced telecommunication systems and modern infrastructure. The applicable corporate and fiscal law of the jurisdiction provides international companies with a number of advantages and additional opportunities for optimizing taxation both at a national and international level.
While the traditional offshore jurisdictions mostly use the market instruments for carrying out business activities, the current business system on the territory of Seychelles is fully regulated and supported by the government.
The legal regime and regulatory system of the jurisdiction
A specialized 1992 International Business Companies Act serves a legal base for carrying out international business in the jurisdiction of Seychelles. Along with the introduction of a new legislative act, a specialized authorized body was created to control and regulate the activities in the sphere of the offshore legal relationships.
In fact, the corporate and fiscal law reform and creation of the specialized state bodies, which perform the functions of the state regulatory body that exercises control over the activities of the offshore banks and companies, allowed the Seychelles offshore jurisdiction to take its rightful place among the traditional offshore jurisdictions.
The International Business Companies Act provides for the possibility of establishing legal entities that are involved in the international commercial and business activities. International business companies are subject to the relatively simplified registration procedure. Availability of a legal address and company office on the territory of Seychelles are the obligatory requirements for creating such legal entities.
Besides, the Seychelles international companies are not allowed to carry out their business and commercial activities on the local market, as well as carry out financial transactions with the residents of the country. However, there are no limitations on the international business companies in all other respects.
The main competitive advantages of the Seychelles offshore jurisdiction
Favourable conditions of registering and maintaining offshore companies have contributed to the significant increase of competitive ability of the Seychelles offshore jurisdiction at the international level. The procedure for registration of an offshore company is relatively simple, and the annual fee for company maintaining is fixed and minimal.
The Seychelles offshore jurisdiction is among the TOP-20 largest international financial centres that provide businesses with the additional opportunities and tax incentives. The island nation has made a real breakthrough in the current fiscal and corporate legislation over the past few decades. Currently, the government is actively working on the improvement of the currency legislation in order to ensure the free convertibility of the national currency.
Besides, the provisions of the bilateral international agreements that are aimed at avoiding double taxation are in force on the territory of the jurisdiction. It allows optimizing taxation at the international level without giving rise to the unfavourable criticism and prosecution by the domestic fiscal authorities.