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ask the money guy | vc viewpoint | your money
KNOWING THE DETAILS INSIDE AND OUT IS GOING TO MAKE OR BREAK ANY ENTREPRENEUR SPECIALIZING IN OFFSHORE REGISTRATION. and in every business sector- it’s part of the world we live in. The fact that this occasionally happens in offshore jurisdictions is inevitable as there are millions of these companies in operation today. I’m sure if the media ever gave a true indication of how these companies were used and were advised to be used from all of the biggest legal and financial institutions globally, maybe we wouldn’t have any negative perceptions – however this would make for a boring story plus the politicians would lose a scapegoat every time an election came around.” Fortunately, most businesses are aware of the offshore benefits, and haven’t missed the boat.
LOGISTICS THE HOW-TO What documentation does a company need to register offshore? “All documents allowing us to conduct our work according to standards commonly known as KYC (know your client) and DD (Due diligence). This includes corporate documentation, passport copies of all persons involved in the structure, bank reference, and proof of address. Our request for due diligence is very similar to that of banks.” What are the benefits of a GCC-based company registering offshore? “Many GCC-based companies set up companies offshore for different reasons: this could be international expansion into developing markets. In this example, rather than setting up a company in the Central African Republic with an unknown judicial system (to the client or investors), clients could prefer to use a company where English law prevails, such as any of the crown dependency jurisdictions; Jersey, Cayman, BVI…
Secondly, we see a lot of people setting up a holding company to own their GCC operating company. This gives protection to the shareholders of the business, and takes the ultimate ownership and control out of the GCC.” Which type of companies stand to benefit most from registering offshore? “It is very hard to say what type of company can benefit the most from registering offshore, because offshore companies are used for a high number of different applications which usually benefits from the underlying assets or purpose from the company. The entity itself is merely the vessel. In broader terms, there are market segments that have successfully proven a track record in using offshore entities. These include property, joint ventures using a natural jurisdiction from both parties, consultancy business with an international client base, and of course clients who have successionplanning motivations.”
Make way for MERS
THE GCC SEES MORE NEW CASES OF CONTAGION Another virus that has been making headlines in the region is the Middle East respiratory syndrome coronavirus (MERS), a virus that is fatal through respiratory infections. The first case of the virus was confirmed in September 2012 in Saudi Arabia, with numbers increasing since then. According to the World Health Organization (WHO), there have been 228 cases, 92 of them being fatal. While the overall numbers over the two-year period are not significantly high, 15 new cases were confirmed over a four-day period last month. In addition to Yemen confirming its first case of MERS, the UAE has also confirmed new cases of MERS, including five health workers who are in quarantine, after another died because of the virus. As of April 30th, KSA’s health authorities confirmed that the total number of cases had reached 361. Jordans’s two newest confirmed cases, as this issue went to print, are a Saudi man and the medic who treated him. While UAE health authorities released a statement saying that the MERS virus is not a public health issue yet, people have been taking serious precautions. 74
Entrepreneur
MAY 2014