14.05.2019. The Netherlands to launch a beneficiaries’ registry for companies in next year
in Company News

Because of the AML 4 protocol, which aims to combat money laundering in the European Union, the Parliament of the Netherlands continues to actively explore the beneficiaries of companies that are registered in the Kingdom.
Under the new rules according to the draft law of the Kingdom of the Netherlands, under the condition of mandatory registration are included:
• Private limited companies (Besloten Vennootschap, or BV);
• Public companies (Naamloze Vennootschap, or NV);
• Cooperatives (Cooperatie) and mutual insurance associations (Onderlinge Waarborgmaatschappij);
• Private funds (Stichting);
• Business associations (Vereniging);
• All types of partnerships – full partnerships (VOF), limited partnerships (CV) and professional partnerships (Maatschap).
The requirement to provide information on beneficiaries will apply to all types of legal entities registered in the Netherlands, regardless of where they operate. Under the terms of the Dutch law, a person will be considered to be the beneficial owner of a legal entity, if he/she:
• Owns more than 25% of the shares of a private limited company;
• Owns more than 25% of shares in the capital of the partnership;
• Uses more than 25% of votes when deciding to amend the internal charter of a private foundation;
• Controls business transactions of a legal entity.
It is expected that the updated rules will come into force in January 2020. Starting from this date, all legal entities will be required to disclose information on beneficial owners during state registration. Those legal entities that have already registered before 2019 are planning to enter an 18-month transition period during which they will have to provide requested information.

9.05.2019. Cyprus will launch a register of beneficiaries in 2020
in Company News

The Department of Registrar of Companies and Official Receiver (DRCOR) of Cyprus has confirmed that starting from 2020, the Register of beneficiaries will be available for the certain authorities.

The registry will start the operation on January 1st of the next year and the Cypriot authorities will get legal access to the full list of all real owners of companies on the island. The registry will not be public, and direct access to the necessary information will receive the competent authorities  such as law enforcement officers, MOKAS agents, tax authorities and regulator representatives, as well as representatives of banks, registration agents, registrars and others.

As said by the head of the Cyprus Association of Auditors, Maryos Skandalis:”..the main question is who will have the right to access this information. It is important to protect the owners from illegal interrogation caused by access to personal data. Therefore, if the list of authorized persons with the right of access to the registry is large enough, this will lead to negative consequences.”

In the future, the Department plans to expand the registrar by including trusts and trust funds. The Cypriot Securities and Exchange Commission from March 1, 2020 will be responsible for controlling the registration of this type of enterprise.

24.04.2019. Virtual banking in Hong Kong
in Company News

At the end of the March Hong Kong started virtual banking era by granting three licenses to institutions that will offer services online instead of physical branches (Livi VB Limited, SC Digital Solutions Limited and ZhongAn Virtual Finance Limited) and are expected to launch the services in nine months.

The Hong Kong Monetary Authority chief executive, Norman Chan Tak-lam said that it is a major milestone in reinforcing Hong Kong’s position as a premier international financial centre and in targeting the public and small and medium enterprises as their main client base, virtual banks should help promote financial inclusion in Hong Kong. The number of licensed banks in Hong Kong will increase to 155 following the grating of the virtual bank licenses.

Guidelines for virtual banks were issued by the HKMA 19 years ago, but last year were revised by the HKMA to allow non financial firms backed by a strong parent, which may not be a financial institution, to open a virtual bank.

Standard Chartered Bank, online lending platform WeLab, Airwallex and Sequoia Capital China were among the confirmed applicants.

10.04.2019. Legislation changes in offshore jurisdictions
in Company News

Starting from 2018 and now there have been a lot of political pressure on offshore jurisdictions and legislation is changing so often that it is becoming very difficult to make a long term business plans in such jurisdictions. It is predicted that more amendments will follow. Here we prepared the summary of amendments made in Belize, BVI and Seychelles Acts.

Belize

From the beginning of this year there are in force changes in  International Business Companies Act in Belize, which declares that it is mandatory for every Belize  company exclude “pure equity holding companies” to prove “economic presence” in Belize. Criteria which prove the economical presence in this jurisdiction relate with the company management, rented office and employees.

“Pure equity holding companies” are companies, which hold only the shares of other companies and whose income is derived only from dividends and capital gains.

For companies registered till 16.10.2017. there are transition period in Belize till 30.06. 2021 in order to make companies to comply with the given requirements.

The latest legislation related with Financial service providers was passed on March 12 and

waiting guidelines that explain made changes in IBC Act in Belize, so, we are going to follow this procedure and inform you.

BVI

Also in BVI from the beginning of 2019 there are requirements to prove the physical presence in the jurisdiction according to the identical criteria mentioned above in the Belize.

The requirements are in force for companies having any of the following activities:

  • banking business
  • insurance business
  • fund management business
  • finance and leasing business
  • headquarters business
  • shipping business
  • holding business
  • intellectual property business
  • distribution and service centre business

There is a time till 01.06.2019 for existing company owners to comply with the legislation changes but till now there are not published guidelines about procedure. We will follow the updates and inform you.

Seychelles

In Seychelles there have been made changes twice last year in International Business Companies Act.

The first changes resulted with following:

  • directors registers registration period was prolonged till 01.12. 2018;
  • penalty for delay now USD 500 plus USD 25 for each day of non-compliance with the obligation to file the Register;
  • register of directors made not public;
  • Registered agent can restore a company if it struck off for 7 years;
  • the Court can restore company if it struck off for 12 years.

The second changes in December 2018 have been made in order to minimize the differences between Seychelles IBC and resident companies:

  • restrictions about activity in Seychelles and ownership/rent of real estate for IBC’s have been cancelled, so now IBC can do a business activity in Seychelles, as well as own and rent a real estate in Seychelles;
  • if the company is doing business in Seychelles, such company will be obliged to pay business tax, that is 15% from  deriving income within Seychelles.
  • as previously company in Seychelles is not paying taxes from incomes earned

Seychelles now has entirely turned back to territorial principle of taxation.

When the Seychelles company  receives a taxable income, it should within a month from the moment when received the first income notify the Registry in written about receiving it and about the activity for which received income. Also within a year after receiving the first taxable income, a company should file the annual report, audited financial statement as local companies.

Also there have been amendments to Business Tax Amendment Act  where are included changes in territorial principle of taxation in Seychelles for all Seychelles  companies. Income received by Seychelles company is considered as an  income by origin in Seychelles, if income received from:

  • activity carried out in Seychelles,
  • sales of goods situated in Seychelles,
  • realization of intellectual property owned by Seychelles company

It is important that if IBC does a part of its business in Seychelles, it as a local company should receive a tax number, pay for this part of income taxes and file the reports in Seychelles.

As there are so many changes made and we predict that more amendments will come, we will be following the latest updates and will keep you informed.

28.03.2019. Payment companies are entering the market more and more
in Company News

Nowadays because of banks’ restrictions opening a bank account is becoming more challenging and bank commissions are rising, people are using more smart phones and payment systems, that are developing very fast, in Hong Kong called as „technological company for payment services”. Payment company is a legal entity, owning a licence in a country, where the head office is located, that allows to manage client funds by opening accounts, processing payments and issuing Visa or MasterCards.

Payment system advantages:
1) fast account opening – for legal and physical entities (restrictions may apply for countries, where the legal entity is registered), including identification, address confirmation document filing, business description and legal document copy filing.
2) easy to use payment system for receiving and processing payments using smart phone
3) easy and fast debit card booking procedure

Disadvantages:
1) no guaranteed sum till EUR 100 000 as for all EU banks in situation of insolvency
2) limited payments outside European Union
3) limited payment transactions in other currencies apart from EUR
4) could be restrictions for the maximum amount for payment transaction, monthly limits

We collaborate with following payment systems:

1. Paysera – fast growing Lithuanian company, operates since 2011 and provides money transfers to more than 180 countries in over 30 currencies. Paysera opens accounts for companies registered in the countries with opened Registers. In 2018 their clients have made more than 1,87 million money transfers for total amount of 3,9 billion euros. Paysera’s incomes in 2018 was 9,7 million euros, that is for 2,1 million euros more than in 2017.
www.paysera.com

2. Fire Financial Services – company from Ireland, that operates since 2010. Fire helps businesses to manage payments with digital accounts and debit cards, in sterling and euro currencies. Fire opens accounts for companies which businesses are related to UK or Ireland.
www.fire.com

3. Cardpay – Cyprus company, established in 2009, is a member of MasterCard, Visa and Union Pay International. Cardpay offers online payments, payment cards, and provision of related corporate accounts to manage funds. Cardpay opens accounts for companies related with e-commerce, software development, FinTech or other „Next Big Thing”- like businesses.
www.cardpay.com