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Your offshore company:
A look at the paperwork

Puzzled by the contents of your corporate package? You are not alone. We explain what's what, what to keep, and what you can throw in the trash.

Certificate of Incorporation
Memorandum and Articles
Appointment of First Directors
Minutes of First Meeting
Register of Directors
Register of Shareholders
Share certificates
Company seal
Certificate of Good Standing
Management agreement
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(Part 1 of 12)

with Peter Widder

Professionals in the offshore industry handle corporation paperwork with the same familiarity as, say, a carpenter handles a length of wood.

They often assume that you, like them, have full knowledge of the workings of offshore corporations. But this is not always the case.

It is not uncommon for first-time buyers to feel a little perplexed when the Fedex package arrives with reams of paperwork, seals and so forth. "What now?" is not an uncommon question.

Having already outlined the basic legal structure and the process of incorporation of a typical offshore company, let us turn our attention to the physical documentation that you -- the "end user" of an offshore company -- are likely to come across.

This might serve as a useful guide not only to those who have already incorporated their offshore company, but especially to those who are just planning to do so. Offshore incorporation agents do not always make a clear distinction between the documentation you really need and the pieces they would like you to buy.

Self-managed new
offshore company

Let us assume that you are the sole director and shareholder of your offshore company.

It is your responsibility to manage the company, sign contracts on behalf the company, open its bank accounts.

You might find some or all of the following items in the company kit received from your offshore company formation agent:

Essential paperwork
1 Certificate of Incorporation
Preferably apostilled.

2 Memorandum and Articles of Association
Ideally registry-certified.

3 Appointment of First Directors
Executed by incorporator, preferably notarised and apostilled.

Optional items
4 Minute Book, including sample Minutes of First Meeting Read more...

5 Register of Directors

6 Register of Shareholders

7 Share certificates

8 Company seal

Essential: Documents (1), (2) and (3) are essential for you to assume control of your offshore company and begin trading. Ensure that your offshore incorporation agent provides them.

Convenient: For reasons of convenience, you might also buy a company seal (8) from your incorporation agent -- although you can easily order one elsewhere.

In the trash: In contrast, you don't need to order items (4) to (7) -- they might prove more hassle than use.

Items (4) to (7) usually make up the bulky part of any company kit -- we are probably talking a heavy binder, embossed with your company name on the outside, filled with sheets and sheets of pre-printed templates and forms, again with your company name all over them. It might look impressive, but have you ever tried fitting all that in a standard-size safety deposit box?

First time? Having said that, if you are a first-time buyer, you might want to get the full kit just to get some guidance on how to draw up and file the relevant paperwork as and when the need comes.

Remember that your offshore company does need to keep records -- we just mean, do you really need that 50-page directors' register or 100 share certificates?

Self-managed offshore
shelf company

When you decide to buy "off the shelf", you are getting a company that has been around at least a couple of months, or even years.

Consequently, you should expect a few documents showing that what you have bought is as good as new; these will be in addition to the paperwork discussed above.

A confirmation of non-trading, signed by either the incorporator or the first director(s), should clearly state that the company has not traded and as such has no assets or liabilities.

A Certificate of Good Standing is useful if your company was formed more than three months ago; it is almost a necessity if the company is older than a year.

If nominee directors were appointed on incorporation -- and you are not keeping them -- you should get a resolution by these original directors appointing you as the new director, followed by a letter of resignation. These two documents serve the same purpose as item (3) above, and it is recommended that they be notarised and apostilled to properly legalise your own position as the director of your new company.

Similarly, if nominee shareholders were in place in the past and you wish to have the shares transferred to your name, there will be additional documentation relating to the share transfer.

offshore company

If you have bought a nominee-managed offshore company, your company package is going to be a lot slimmer.

The nominee director will maintain all the necessary records for your company. As a result, all the company's statutory books and registers, as well as the company's seal, will remain with the nominee.

Nevertheless, you will still get a Certificate of Incorporation and a copy of the Memorandum and Articles of Association as evidence of your company's formation.

If, for whichever reason, you have not employed a nominee shareholder at the same time, your company package should also include share certificates issued as per your instructions.

You will almost always need to sign a management agreement between yourself and the nominee director; your company package should include a copy of the same.


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