Loyal Agency and Trust Corp.  – Frequently asked questions

 

  1. What is LATC and why is it a separate company?
  2. Has a majority shareholder in any IBC the right of primary purchase of shares from the second shareholder? Or the second shareholder can sell them to anybody?
  3. I want to close down my IBC: what do I do?
  4. Can I register a Foundation in SVG??
  5. I want to register an IBC but don’t want the Ultimate Beneficial Owner (UBO’s) identity known to anyone: can you help me?
  6. Can an SVG citizen / resident can be the 100% owner / shareholder of an SVG registered IBC?
  7. Can hybrid companies be formed and registered in SVG?
  8. Can we register Trademark under an SVG IBC / legislation?
  9. Can an IBC have an onshore account and can you help with this?
  10. Can I set up a Segregated Cell Company in SVG?
  11. Is it possible to re-domicile a Seychelles company (or a legal entity registered in other jurisdictions) – if yes, what would be the procedure and costs for it?
  12. Can I call my new SVG IBC anything I want?
  13. A client wants to close down a company but he hasn’t paid the annual fee. Does he have to pay the missing annual fee and late penalty fee before closing down the company?
  14. Can I have information on the possibilities for authorized and issued capital of an IBC?
  15. A client wants to register an onshore company in SVG: can LATC do this?
  16. Do we offer formation of Exempt Limited Partnership in St. Vincent?
  17. Are the LLC / IBC structures able to buy property in the USA (Loyal bank escrow services valid in USA?)
  18. How safe are clients’ funds managed by an SVG IBC forex broker company? If the company was to go out of business or cease trading for any reason, are the clients’ funds protected in any way, and are they kept/held in a segregated account?
  19. Buying property in St Vincent / Alien Land Holding Permit
  20. Can the SVG regulator (the FSA) issue an “FX trading “or “Investment “license to my company?
  21. How do I get a banking license in SVG?
  22. Legalisation of documents at the Chinese Embassy in SVG
  23. Is there a Hungarian Embassy in SVG?

 

 

1.What is LATC?

 

LATC is Loyal Agency and Trust Corp., is a Registered Agent incorporated under the laws of SVG. It was founded on 16th March 2010. It is a licensed agent for the registration of IBCs, LLCs, Trusts, and other legitimate international structures in SVG with the Financial Services Authority (FSA) in St Vincent.

 

Please note that in case of Trusts FSA require that LATC is always the Trustee: there can be any number of Co – Trustees. The client or his nominee cannot be the Trustee and LATC the Co-Trustee. 

 

 

2. Has a majority shareholder in any IBC the right of primary purchase of shares from the second shareholder? Or can the second shareholder sell them to anybody?


There is no "right" under SVG law: the shareholder of any IBC can sell part or all of their shares to anyone (except sanctioned or boycotted persons on the Patriot Act or OECD or OFAC etc. lists) however the new owner of part / all of the shareholding will not be registered by LATC ( and so the sale effectively does not exist )  as the new owner of these shares unless they supply full and verified Due Diligence which is approved by LATC and the change of ownership subsequently registered at the FSA.

 

If no DD is supplied, or it is insufficient, or the new shareholder is unacceptable to us for compliance reasons, then we (and the FSA) do not recognise the sale as ever having happened and so no further or later shareholders have any valid title of ownership.



3. I want to “close down “my IBC: what do I do?


This is known as striking off an IBC and is carried out by LATC if requested by the client:

 

  1. A signed, dated resolution, by the director or BO of the company indicating the striking off of the IBC must be submitted to the Agency.
  2. An invoice is then issued for the service to be carried out.
  3. Once payment is received, the service will be executed.
  4. A Letter from the Registering Authority will be given to us indicating the striking off, which will be sent to the client as proof of striking off.
  5. The Registrar will then publish a notice of the striking off and dissolution of a company under that section in the National Gazette.

 

 

4. Can I register a Foundation in SVG?

 

No. This structure is currently not available under the laws of SVG. However, LATC can set up Foundations in Mauritius as well as in Panama and in Nevis.

 

Nevis Foundations are complex and generally our choice has been Panama, however official documents will be in Spanish. Mauritius is an English speaking alternative.

 

 

5. I want to register an IBC but don’t want the Ultimate Beneficial Owner (UBO’s) identity known to anyone: can you help me?


No. The identity of the Ultimate Beneficial Owner(s) is handled confidentially, and information is not given out to anybody (except in cases detailed in Points 15 and 16), but there must be full disclosure to LATC of the UBOs identity and physical address. This is required by law and there are no exceptions to this, ever.

 

We do not accept anonymous accounts / IBC applications, or cases where the UBO’s identity cannot be proven. In such cases we will decline to register the IBC at the FSA.

 

 

6. Can an SVG citizen / resident be the 100% owner / shareholder of an SVG registered IBC?


Yes, there is nothing in the IBC Act prohibiting any SVG citizen from owning an SVG IBC. However, an SVG IBC cannot be used to trade or carry out business in SVG, it cannot deal with any residents, it cannot register for VAT (so cannot in turn reclaim it) nor can be used to avoid any type of local taxes but it can be used to hold land or buildings, to open a foreign bank account or a local bank account etc.

 

In practice the restrictions above make it unfeasible or uneconomic (but not illegal) for any SVG citizen / resident to own an IBC 100%.



7. Can hybrid companies be formed and registered in SVG?


Yes, the Registered Agent LATC can assist the client in registering hybrid companies under SVG legislation.

 

A Hybrid company is a form of International Business Company (an IBC) which combines certain features of an IBC and a Trust, and is especially useful to persons resident in civil law countries that do not recognize Trusts. As with Trusts, Hybrid structures may be useful for asset protection, tax planning (including estate tax planning), confidentiality and avoiding forced heir ship rules. The Hybrid also offers an ideal structure for long-term investors to accumulate their profits offshore tax-free. Beneficiary members can honestly declare to authorities in their own country that they do not own, directly or beneficially, these assets overseas. As with IBCs Hybrids are exempt from taxation in St. Vincent and are given a 25 year tax exemption certificate by the registrar upon formation. 

 

Advantages:

 

• A Hybrid Company can be used as an alternative to a Trust.

 

• It provides the alternative of having shareholders and guarantee members within the same legal entity.

 

Formation:

1. Hybrid companies can be formed in SVG and LATC can register them if required. The process is similar to registering an IBC and the DD is identical.

2. A hybrid company has 2 classes of members: shareholding members and guarantee/beneficiary members. The Shareholding member holds an interest (shares) in the company while the Guarantee member has an obligation, that is, they undertake to contribute to the debts of the company up to a certain amount (typically US $100) in the event of liquidation. The ordinary share holder receives no dividends (after payment to preference shareholders) which instead flow to the guarantee members making them more like beneficiaries of a typical trust.

3. There must be at least of each type of member however FSA confirm that same person can participate in the company as both a Shareholding member and a Guarantee member.

 

A Hybrid Company may not be suitable for everyone and we recommend that you take appropriate professional advice in your own country to determine if it is right for you.



8. Can LATC register a Trademark under an SVG IBC / legislation?


Yes, but trademarks cannot be registered at the FSA. The procedure is done via a lawyer and registration is at the Commerce and Intellectual Property Office (CIPO) of the SVG government. LATCs fee for Registration of a Trademark is USD 2,500 flat per trademark which includes the lawyer’s fee and the official fees. The fee is payable in advance.

 

There are 45 classes of registration of which 34 relate to goods and 11 to services. For the list of classes please consult the International Classification of Goods and Services which can be found in a book called Nice Classification, 10th Edition. It can be obtained from the WIPO (World Intellectual Property Organization) e-bookshop.


9.Can an IBC have an onshore account in SVG and can you help with this?


In theory yes, it can but in practice the attitude of the onshore banks in SVG changes often and applications from IBCs are usually declined, usually after a long delay, on compliance grounds.

 

Since IBCs cannot trade locally there is no need or any real benefit for them to have an onshore account but if the client insists, LATC will process submit applications, however LATCs fees are USD 250 per hour (minimum billing four hours, i.e. USD 1,000, to be paid in advance) and we do not guarantee success: if the onshore banks refuse, there is no refund.



10. Can I set up a Segregated Cell Company in SVG?


Yes it can be registered by LATC. Note however, that an SCC is not just a form of IBC in fact it more closely resembles a Trust in the sense of complexity and specialist legal skills being needed to get it right, and it would command similar pricing as with an LLC.

 

A segregated cell company is a company containing assets and liabilities that are legally segregated from the assets and liabilities of the company’s general account and the other segregated cell accounts. Segregated portfolio assets comprise assets representing share capital, retained earnings, capital reserves, share premiums and all other assets attributable to or held within the segregated portfolio.

SCCs first originated in Guernsey and Delaware, but a number of other jurisdictions followed, and they can now be formed in Bermuda, the British Virgin Islands, the Cayman Islands, Anguilla, Ireland (the Republic of), Mauritius, Jersey, the Isle of Man, Malta, Qatar and Gibraltar, and in SVG as a type of IBC.

 

SCCs – under SVG law – are only available in SVG to Insurance or Mutual Fund companies and SVG law does require Insurance or Mutual Fund companies to hold an SVG FSA Insurance or Mutual Fund license.

 

Features. Each cell is only liable for its own debts and not for the debts of any other cell within the company. Where assets have been allocated to a cell, only creditors who have entered into transactions with that cell or who have otherwise become creditors of the cell concerned have recourse against those assets. There is a duty on the directors to keep the assets of each cell separately identifiable as follows:

-        to keep cellular assets separate and separately identifiable from non-cellular assets; and

-        to keep cellular assets attributable to each cell separate and separately identifiable from cellular assets attributable to other cells.

 

Not all assets belonging to a protected cell company have to be allocated to a cell. Where they are not, the assets will be available to any creditor of the company.

SCCs have several potential functions. They are most commonly used in the formation of collective investment schemes as umbrella funds and for the formation of captive insurance companies (typically a variation of a "rent-a-captive"). They are also sometimes used as asset holding vehicles (characteristically where each portfolio holds a single ship or aircraft, and they can also potentially be used in capital markets debt issuances.

 

Although growing in popularity, SCCs still remain something of a niche product. Because of the relative ease of forming multiple offshore companies in most jurisdictions where SCCs are available for incorporation, and because it is uncertain how the concept of segregated portfolios (and thus no consequential cross-contamination of liabilities) would be treated in an onshore bankruptcy or by credit ratings agencies, many promoters still instead opt for the formation of multiple companies under a single holding company.


11. Is it possible to re-domicile to SVG a Seychelles IBC company (or a legal entity registered in other jurisdictions) – if yes, what would be the procedure and costs for it?


Yes this can be done by LATC provided the Seychelles company (or a legal entity registered in other jurisdiction) is in Good Standing already. If not in Good Standing in the other jurisdiction, this must be remedied before re-domicile begins.

 

The process for re-domiciling an IBC is similar to the process for IBC incorporation. Any IBC can be re-domiciled unless the Articles or By-Laws prohibit this. The following conditions are required:

  1. The IBC must be in legal good standing in the country of registration/domicile. This is represented by the submission of a Certificate of Good Standing and a Certificate of Incumbency.
  2. There must be a director’s resolution dated not older than 14 days, stating the directors have resolved to change registered jurisdiction.
  3. Due Diligence Documents (Notarised Passport, Certified Bank Reference and Certified Utility Bill) for Directors, Shareholders and Beneficial Owners of the IBC
  4. The original company documents should be couriered to our office. We will make copies for submission to the Authorities.
  5. A Business Plan is required

 

Prices are available on the LATC website.



12. Why can’t I call my new SVG IBC any name I want?

 

IBC names suggested by clients have to be checked by LATC with the FSA registry before any application is submitted, which is why one name and two alternative names are always requested by LATC. There are some words and phrases which are not permitted in any name, such as “Royal”, “Bank” and “Insurance”.

 

In line with the IBC Act, the name of an international business company:

(a) shall not be the same as, or similar to, the name or business name of any other person or of any association, partnership or firm registered or incorporated under this Act or the Companies Act, if the use of that name would be likely to confuse or mislead, unless the person, association, partnership or firm consents in writing to the use of that name in whole or in part, and—

 (b) shall not be identical to that under which a company in existence is already incorporated under this Act or registered under the Companies Act or so nearly resembles the name as to be calculated to deceive, except where the company in existence gives its written consent;

(c ) shall not suggest or imply-

(i) the patronage of Her Majesty or that of a member of the Royal Family,

(ii) a connection with Her Majesty’s Government or a department thereof, or

(iii) a connection with a municipality or other local authority or with a society or body incorporated by Royal Charter, except with the written approval of the Governor-General;

(d) shall not suggest or imply a connection with a political party or a leader of a political party;

(e) shall not be indecent, offensive, or, in the opinion of the Registrar, objectionable;

(f) shall not suggest or imply a connection with a university or a professional association unless the university or professional association concerned consents in writing to the use of the proposed name; and

(g) shall not be a name that is prohibited by the Regulations.

 

If a name submitted to the Registrar falls in any of the above categories, it will be rejected the Registrar. There is no appeal against registration rejection.

 

It is important to note that the suffixes denote the corporate vehicle that will be incorporated. If a Fund is to be created, the word “Fund” must be in the proposed. If a LLC is to be created, the letters “LLC” should be a part of the name: and so on.



13. I want to close down an IBC company but haven’t paid the annual fee. Do I have to pay the missing annual fee and late penalty fee before closing down the company?

 

Depends on what is meant.

1. If the annual fees are not paid, then the IBC is eventually struck off by the FSA Registrar and there is no extra cost or fee for this. This can be at any time, as allowed in the IBC Act, but in practice striking off is after 1- 2 years of non - payment. In the meantime the company is not in “Good Standing” whilst fees remain unpaid and so cannot legally operate.

2. If however by “closing down” a formal liquidation and winding up of the company is meant then there is an official procedure for this. The options are:

 

(a)  a dissolution, in this case a plan of dissolution would be needed outlining

-          why the IBC is dissolving

-          that the company is able to pay off its debts, liabilities etc.

-          date of dissolution

-          estimated time to wind up and dissolve

-          who is the liquidator (name, address of person), is the liquidator going to send a statement of account regarding his actions or transaction to all members.

An Article of Dissolution has to be filed with the Register, along with the plan of Dissolution. Within 30 days of filing with the Register we have to publish in the Gazette a notice stating that the company is dissolving, the date it started dissolving and who is the Liquidator.

Meanwhile we would require a letter from the liquidator stating that the winding up and dissolution has been completed, and that all debts are paid. We then send this letter to the Registrar, who upon receiving this notice, will strike the IBC from the Register and a Certificate of Dissolution would be issued.

 

(b)  You may opt to strike the company from the Register. With this procedure, you can authorize in writing that you wish the Registered Agent to procure the striking off. Here, LATC will write a letter to the FSA on your behalf asking for the striking off.

 

Note: Fees apply for option a) or b): contact LATC for details.



14. Can I have information on the possibilities for authorized and issued capital of an IBC?

 

The minimum authorized capital for an SVG IBC can be any amount the client selects and in any currency (minimum 1.00 currency unit). The issued capital can be any amount up to, but not beyond, the authorized capital.

 

There is no maximum although absurd figures (billions and trillions) might be questioned by the Registrar and is discouraged.



15. I want to register a resident company in SVG: can LATC do this for me?


Yes LATC can, but there is no practical advantage or benefit and in all respects an IBC is better.

 

An onshore company has to pay tax, file annual accounts etc. and maintain a physical address in SVG where its books and records are held, and this is subject to official inspection. LATCs offices will not qualify in that respect.



16. Does LATC offer formation of Exempt Limited Partnerships in St. Vincent?


No, LATC cannot do this. This type of company structure is not offered in SVG as there is no legislation that allows for it.



17. Are the LLC / IBC structures able to buy property in the USA?


That depends on USA law: an IBC or LLC can own property just about anywhere according to SVG law (even if the property is in SVG) but foreign ownership of a property in the USA depends on USA law. We recommend consultation with a reputable USA lawyer.

 

If the client also wants to obtain finance in the USA again a USA lawyer should be consulted as the laws governing this may vary from state to state. Another point would be whether any USA lender would lend to an offshore company:  LATC cannot comment on that aspect, as it would depend on the credit policies of the lender.



18. I want to invest funds with an SVG IBC that works as a foreign exchange trader .Are the clients’ funds protected in any way, and are they kept/held in a segregated account?

 

Loyal Agency and Trust Corp.is the Registered Agent of an International Business Company in SVG.  All IBCs are required under the IBC Act of 2007 to have a Registered Agent in St. Vincent however as the Registered Agent LATC has no responsibility for supervising, regulating, over-seeing, running or managing the operations of any IBC, no matter what type of business the IBC is in.   

 

For these reasons LATC can never comment on the operations, solvency, probity or profitability of any IBC nor can it ever make any comment on whether an investment with any IBC is suitable for the proposed investor or not : investors must carry out their own investigations and due diligence and be guided by the outcomes.

 

Under the IBC Act 2007 an IBC is not required to file annual audited accounts, to hold annual meetings or to file any minutes of any meeting, etc. and therefore LATC are not able to pass any comment as to the company’s operations, status or standing or the safety of client funds and whether or not a client’s investment is in a segregated account, and we can only recommend that clients address their inquiries direct to the SVG IBC forex broking company at their place of business, which is not in St. Vincent, as unfortunately we are not in a position to assist them in such cases.

 

Please also note that such forex trading is not regulated or licensed by the Financial Services Authority in SVG or any other government agency in SVG.



19. I am interested in buying a property in St Vincent .Do I need any permit if I am not a citizen?

 

Yes. Anyone not an SVG citizen has no automatic right to buy property in SVG but must apply for an Alien Land Holding Permit. This is so even if a Residence Permit has been issued.

 

  1. The person must apply through a lawyer who completes the document and submits with the requirement such as:  police record, bank statement, character reference and much more [a valid reason also needs to be given as well as evidence of the means to finance or pay for the purchase: investment or pure speculation is not a valid reason].

 

  1. There are several  SVG lawyers who  specialise in such applications and LATC can make the required arrangements with them for you

 

LATC cannot assist any client in finding a property although we can put him in touch with real estate agents here.



20. Can the SVG regulator (the FSA) issue an “Investment “license to my IBC company?

 

No, the FSA issues only three types of licenses:

 

  1. Bank licenses ( Class A or B: the Due Diligence is the same )
  2. Insurance company licenses
  3. Mutual Fund licenses

 

The FSA does not issue any  “Investment “licenses and will never license any activity or company which it cannot regulate and which does not have a physical place of business with both ” mind and management” and “books and records” in SVG. No such "investment “licenses exist in SVG (although they may exist in other countries) which is why they cannot be issued.



21. Can LATC assist me to apply for a banking license in SVG?

 

Yes, however banking licenses are only issued by the FSA subject to very detailed and comprehensive application procedures, due diligence and the payment of fees. Applications can only be made through a Registered Agent such as LATC. Frivolous, incomplete or hastily – prepared applications stand no chance of success and to be accepted an applicant must prove impeccable credentials, personal probity, experience and qualifications, and be able to show substantial resources.

 

There are two types of SVG offshore Banking license Banking License (Class A or B) the difference being in the capital needed and, for Class B, the proposed clients of the bank can only be the existing shareholders.

 

LATC can vet, review and submit your application for a banking license. Such applications can only be submitted via Registered Agent, such as LATC.

 

The total cost of applying for a Class A Banking License is USD 35,000 and a Class B Banking License is USD 27,500. LATC require full payment but will accept a deposit of 50% up front. This is payable in advance and all and any fees are strictly non-refundable in the event of a rejection by the FSA or withdrawal or non – completion of the application.

 

When considering licensing a new bank, the FSA evaluates the following criteria:

 

i. The personal integrity of each shareholder

ii. The shareholders’ ability to finance the bank so that it remains liquid

iii. The banking experience of the directors or senior officers and managers

 

If the applicant satisfies the above criteria, the Authority will have some comfort with regards to the successful operation of the bank and the bank’s ability to meet depositors’ and creditors’ needs; however the applicant must absolutely satisfy the Authority that each requirement is met.

 

List of documentation required to be submitted to FSA with any application of a banking license: (It is not an exhaustive list and the Authority has the right to seek additional information in order to satisfy the criteria given above. The Authority may also engage third parties such as Kroll Investigations to verify certain data, and this will be at the cost of the applicant.)

 

(1) Completed Application form for Class “A” or Class “B” banking license

(2) A letter from an SVG lawyer confirming that they consent to act for the applicant.

(3) A letter from an SVG external auditor confirming that they consent to act for the applicant.

(4) Evidence of a proper application for incorporation of an IBC company in the state and that the company is an “eligible company” to be the owner of the bank (NB only an SVG IBC can be awarded a Class A or B Banking License).

(5) Evidence in writing that the applicant itself or some person directly or indirectly connected with the applicant is possessed of solid and practical experience in banking business.

(6) An undertaking in writing to provide and set apart a fully paid-up capital fund before or at the time it commences business, based upon the class of license for which the application is being made.

(7) Police record certifying no criminal convictions or alternatively a police record approved by the Authority, for all persons to be involved in the proposed bank as managers, directors, owners, etc.

(8) Annual accounts of its holding company, if any, for the preceding three years and subsequently annually duly audited and certified by an independent auditor.

(9) Attachment with names of all subsidiary companies of the applicant with addresses of their registered offices.

(10) A copy of the articles of incorporation and by-laws of the applicant company verified by an affidavit sworn by the Resident director of the applicant.

(11) Character references for Directors and shareholders, one personal and two from banks.

(12) Statement of assets and liabilities, and certified statement of net worth of the applicant shareholder; where the applicant is an existing company, basic financial statements and where the applicant is a group of companies, the audited financial statements from all the members of the group.

 (13) Statement of capital of any company held directly or through a subsidiary as an asset of the applicant.

(14) If application is being made for a Class B licenses the list and description of the proposed customers of the licensee.

(15) Provide a business plan containing the following:

(a) a description of the objectives of the company;

(b) proposed customer base;

(a) opening balance sheet and three year projections as certified by an auditor;

(b) management structure;

(c) anti money laundering policies and provision

(d) a feasibility study;

(e) the economic need that the company intend to meet;

(f) a description of internal systems and controls; and

(g) copy of the ownership structure including group member and affiliated companies.

(16) Completed due diligence questionnaire. (All officers and shareholders must complete a fit and proper questionnaire.)

(17) The nature and source of capital and statutory deposit financing.

(18) Proof of applicants’ ability to meet statutory requirements for minimum paid up capital and statutory deposits.

 

The due diligence documents are subject to scrutiny by FSA, they will also charge a non - refundable fee for this. All documents not in English must be accompanied by a certified translation and all documents must be notarized.

 

Please note that an IBC has to be incorporated before the banking license can be applied for.



22. Can I arrange legalisation of my documents at the Chinese Embassy in SVG?


No. There is no Chinese (PRC) Embassy in SVG, only that of the Republic of China (Taiwan) who refuse to have anything to do with PRC documents. The nearest PRC Embassy is in Barbados (100 miles away).



23. Does my country have an Embassy in SVG where documents can be legalilsed?


The following countries only have a diplomatic mission in SVG: 1. Embassies: Brazil, Republic of China (Taiwan), Cuba, and Venezuela. 2. Honorary Consulates: The Netherlands, Finland, Sweden [Note an Honorary Consul cannot attest documents or issue visas, etc.].