What are the principal changes in the International Business Company coming about as a result of new legislation?

Category: Corporate Services

Answer:

The IBC Act, 2000 repealed the International Business Companies Act 1989 and reenacted provisions for the incorporation, registration and operation of International Business Companies. By virtue of section 175 (4) IBCA, the fee schedule under the Old Act will continue to apply until the end of 2001. Thereafter, the fees mentioned in the Schedule to the IBCA will apply along with those fees under the Old Act which were not changed by the Schedule in the IBCA.

The IBCA 2000 - and 2001 Amendments - modified the Bahamian IBC as follows:

• Bearer Shares are no longer permitted;
• Directors and Officers must be a matter of public record;
• Penalties for offences have been increased in scale and scope;
• New IBCs do not have a guaranteed fiscal exemption;
• With Exchange Control approval, an IBC may have Bahamian resident shareholders and carry on business in The Bahamas with Bahamian residents.

Existing IBCs are allowed 180 days to transition into compliance with the requirements of the IBCA.

The abolition of bearer shares and the requirement of public registration of directors and officers address FSF, FATF and OECD issues of transparency relative to identification, recording and making available relevant information related to legal and business entities. Additionally, only banks and trust companies licenced under the BTCRA and financial and corporate service providers licenced under the FCSPA may provide registration, management, administration, registered agent, registered office, nominee shareholders and officers and directors for IBCs. Both the BTCRA and the FCSPA require their respective licensees to obtain beneficial ownership information and to comply with the FTRA. As a consequence, full application of the know-your-customer regime required by the FTRA and FTRR applies in relation to IBCs.