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Untitled Document
International Focus Cyprus– Online Edition
Who are Jordans Limited?
Jordans Limited are the leading providers of corporate services in the UK and has offices in the principal offshore financial centres, including the British Virgin Islands, Cyprus, Gibraltar, Jersey, Seychelles and the UK.
We have extensive experience in using international centres to support a variety of commercial transactions and individuals’ wealth preservation strategies. Our network of offices around the world also enable clients to maximise the potential advantages of different legislative structures.
Jordans Services
Jordans offers a full range of fiduciary services for international intermediaries, individuals
and corporates. These services include:
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 Incorporation of UK and offshore companies
We can incorporate companies in many jurisdictions quickly and efficiently. Ready-made companies are also available. Principal jurisdictions include the UK, BVI, Seychelles, Gibraltar, Jersey, Ireland and the Isle of Man.
Registered office services
We can provide a registered office for your company enabling you to have a permanent postal address for your business. All correspondence received at the registered office is treated confidentially and promptly forwarded.
Company secretarial services
Jordans can provide a company secretary where necessary. Accurate and timely company secretarial work is vital to the successful implementation of many international tax planning arrangements.
Nominee shareholder facilities
We can provide registered corporate nominees in a variety of jurisdictions to hold shares on behalf of individuals, companies or trusts, in order to preserve confidentiality.
Director services
Jordans can provide director services for companies, allowing your company to demonstrate that the place of effective management of its business is located in a territory appropriate for your tax planning arrangements.
Full company administration services
Jordans can provide comprehensive administration services for commercially active UK and offshore companies. This includes the opening and operation of bank accounts, fax and mail forwarding services, invoicing and bookkeeping services.
Opening and operation of bank accounts
Jordans has excellent relationships with the worlds leading banks. We can open corporate bank accounts promptly, upon receipt of all necessary due diligence on the company participators, where we act as directors and bank signatories.
Statutory accounting services and preparation of tax returns
Jordans can draw up statutory accounts for companies for a fixed fee, based on the turnover of the company’s business.
VAT registration
We can VAT register companies, where applicable, and help administer their monthly or quarterly VAT compliance obligations. Our principal VAT territories are the UK and Cyprus.
Arrangement of audit services
We can arrange the services of auditors familiar with international tax planning arrangements to prepare audited financial statements.
Creation and administration of discretionary trusts
UK and offshore trusts are vital to the success of many kinds of offshore tax planning arrangements. Jordans can establish a variety of tax-efficient trusts for its clients, including discretionary and fixed interest trusts.
Tax planning advice
Jordans, through its network of local correspondents or its associated company Jordan Fiscal Services Limited can provide a wide range of high quality international tax advice for intermediaries, individuals and corporates.
International Tax Planning Opportunities via the Republic of Cyprus
Cyprus boasts an excellent professional infrastructure for the support and execution of multinational business and cross-border tax planning, possessing high quality international banking facilities and first class legal and accounting services.
As a full member of the European Union, Cyprus provides a secure, well-regulated financial environment for international clients and the lowest corporate tax rate within the EU.
The incorporation of a Cyprus company offers a gateway into the EU for non-EU investors, no exchange control restrictions, a fast incorporation process with ready-made companies available and no minimum paid up share capital required
Cyprus is a key centre for investment into many of the developing Eastern European countries, with which Cyprus enjoys good cultural links and excellent double taxation agreements, including the countries of Bulgaria, Hungary, Romania, and Russia.
A number of international tax agreements also exist that are applicable to Cyprus companies, which help to reduce or eliminate taxation on overseas dividend, interest and royalty streams.
With an efficient professional infrastructure and excellent double taxation agreements Cyprus is a leading financial centre.
Jordans (Cyprus) Limited provides unparalleled expertise in creating and administering corporate and trust structures on behalf of local and international businesses, entrepreneurs and high net worth families. We can also provide tax planning advice to our clients to ensure that optimum use is made of Cyprus companies and trusts.
The Seychelles – One of the fastest growing offshore incorporation centres
The Seychelles is becoming an increasingly popular incorporation centre. Company formation numbers have increased significantly over the last 3 years. A variety of factors can be attributed to this growth.
- The Seychelles has no relationship with the EU and thus is not subject to bureaucratic EU initiatives (although they have embraced FATF and international standards of due diligence and anti-money laundering provisions).
- The Seychelles Companies Registry is remarkably efficient, issuing certificates of incorporation within hours of lodgement.
- The Seychelles have maintained very low annual license fees, and equally low redomiciliation costs which have attracted companies to migrate from other jurisdictions.
There are a number of proposed amendments to the Seychelles companies legislation through both the IBC Amendment Bill 2006 and CSL Amendment Bill 2006.
Included in the IBC Bill are:
- Provisions for companies limited by guarantee and hybrid companies (limited by shares and guarantee)
- Permission to use a country name in the company name
- Ability to reserve company names beyond the present 30 day limit
- Resignation facility for registered agents
- An increase in the post-striking off restoration period from three to ten years
- Optional registration of mortgages and charges and provision for an optional register of charges
- The CSL Amendment Bill affects ‘special license’ companies, i.e. those tax resident in the Seychelles and entitled to benefit from the Seychelles growing number of double taxation treaties.
The Seychelles has double taxation treaties with the following countries:
- China
- Botswana
- South Africa
- Mauritius
- Indonesia
- Thailand
- Oman
A further 30 treaties are in various stages of progress. Interesting examples include Cyprus and Malaysia that are awaiting ratification. Treaties proposed or under negotiation with EU countries include Belgium, Malta, Portugal and Sweden.
The CSL Amendment Bill includes the following features:
- Reduction of minimum shareholder requirement from two to one
- Obligation for company secretaries to be fully licensed in the Seychelles
- Creation of the ability for a CSL to convert to an IBC
- Extension of the guaranteed concession period from ten to twenty years
It is clear that the Seychelles offer a very viable alternative to the BVI (and other territories dependant on an EU member country) for clients to whom EU dependency is a concern. By retaining competitive fee levels and the continuing improvement of legislation, the Seychelles present growth rate seems set to continue.
The UK Companies Act 2006 – An update
The UK Companies Act 2006 (formerly Company Law Reform Bill) is the first fundamental review and overhaul of UK company law since 1985. Please note that only the private company aspects to the Bill have been reviewed - the public and quoted company provisions are not covered.
The legislation is drafted on a "Think Small Company First" principle. It therefore uses simpler language than before and removes the private company from a number of procedures and regulations.
However, for public companies the detail in the current legislation remains, and further provisions have been added to reflect various European Directives, including provisions relating to takeovers and disclosure of information, and to promote communication between the company and its shareholders. This is to encourage the concept of enlightened shareholder value.
E-communications are also facilitated by the Bill, with provisions which allow companies to communicate with their shareholders via email or websites.
This article is split into the following areas, please click on each section for more information
Formation
- Private companies will, in future, be formed by one person. There is no need to appoint a company secretary (although the duties of the Company Secretary will remain), and one person may be both director and shareholder.
- There will be one constitutional document on formation. The memorandum is replaced by a much shorter document saying that the members wish to form a company and agree to take at least one share/give a guarantee. This is effectively a snapshot of the company's membership on formation. The new law provides that the company has the same legal capacity as a natural person so the objects clause is no longer needed. In addition, a standard set of substantially simplified articles will replace the existing Table A based articles of association.
- The information to be provided on formation differs to that currently provided. Authorised share capital is abolished and a statement of capital and initial shareholdings will be submitted to Companies House on formation. Form 10 will therefore change accordingly.
- Form 12 (the statutory declaration on formation) will be replaced by a "statement of compliance".
- Corporate directors may not be appointed unless there is also a natural person acting as a director.
- Any director is obliged to register a service address at Companies House as well as a residential address. The service address, which may be the company's registered office, will be public, and the residential address will be held confidential unless it becomes impossible to communicate with the director via his service address.
- Details of any person appointed as an authorised signatory must also be produced on formation.
- Provisions have been included to prevent company names being registered to exploit a third party's goodwill in a name and to prevent the registration of too similar names.
Company administration
- Private companies need not appoint a secretary. There is a provision in the Bill that says that anything that is required to be done by or to the secretary may be done by or to a director or by or to a person authorised by the director in that behalf.
- However, the duties currently carried out by the company secretary remain, such as the obligation to maintain a register of members, register of directors and register of charges. In addition two new registers are created: the register of director's residential addresses and the register of authorised signatures. There is clarification that records and registers may be kept in electronic form.
- The obligation to file an annual return remains.
- A private company is not required to hold an annual general meeting.
- More flexibility has been introduced to enable the company to set the level of shareholder approval necessary to change its name.
- The register of members must now be kept for 10 years instead of 20 years. Board minutes must be kept for at least 10 years.
- The Secretary of State has power, by secondary legislation, to make rules relating to the disclosure and display of company information in certain locations or in certain company communications. The intention is to align the disclosure requirements in the Companies Act 1985 and the Business Names Act 1985.
- There are provisions in the Bill for shareholders and companies to consent to dealing with each other electronically rather than in hard copy format.
Shares and share issues
- A private company with only one class of shares may allot shares without shareholder authority, unless its articles provide otherwise.
- It will be easier to allot redeemable shares.
- Shares may be issued direct to bearer without first being issued in registered form.
- The prohibition on a private company offering shares to the public remains, but the criminal penalty is removed and replaced by penalties that will require the company to re-register as a public company or to be struck off.
- Shares may be denominated in any currency but must always have a par value.
Directors
- With a view to ensuring that there is one adult individual responsible for the company's actions, children under 16 may not be appointed as directors and companies may not act as the sole director.
- A statutory code of directors' duties has been introduced.
- The various provisions in the Companies Act 1985 relating to disclosure and approval of transactions with directors have been revised and restated.
- There is a new section relating to ratification of director's acts by shareholders, but this does not affect any provision of law that provides that a particular act or omission may not be ratified.
Articles of association
- Standard form articles for private companies limited by shares, public companies and private companies limited by guarantee will be produced which will apply in default of amendment.
- It will not be possible to irreversibly entrench provisions into the articles. For example, the provision found in guarantee company articles that prohibit profit distributions. Entrenched provisions may be removed or amended if all of the members agree.
Meetings and resolutions
- The majority necessary to consent to short notice will change from 95% to 90%.
- The shareholder written resolution procedure has been changed, so that written resolution are passed with the signature of the appropriate percentage of members, rather than by unanimity. In addition if consent to the passing of the resolution is not obtained within 28 days of the circulation date, the resolution lapses.
- The provisions regarding calling and notice of meetings, appointments of proxy and corporate representatives, quorums and polls have all been restated and revised.
Corporate procedures
Various corporate procedures are affected, as follows:
- The prohibition on financial assistance is abolished for private companies, unless it is a wholly owned subsidiary of a public company.
- The reduction of share capital procedure is simplified with creditors being protected through a declaration of solvency made by the directors, rather than by a court process.
- The re-registration procedures (private to public and vice versa) are revised and restated.
- There is a new procedure to make it easier to redesignate the currency of issued share capital.
- A new procedure will be introduced by secondary legislation to allow the migration of the registered office from England & Wales to Wales or Scotland and vice versa.
- Public companies may take advantage of the voluntary strike off procedures in the Companies Act 1985.
- Changes will be made, by secondary legislation, to align the "place of business" and "branch" registration provisions, to simplify the rules applicable to offshore companies.
- Changes are made to the purchase of own shares provisions.
- There are new sections relating to the bringing of derivative actions by shareholders (ie where a shareholder brings a claim alleging that the company has suffered loss and therefore his share value has suffered loss).
Under the current law it is difficult for shareholders to bring such actions if the company decides not to take action itself (for example, if the loss is caused by the directors). Under the Bill, shareholders will be able to take action against the directors for breach of duty or trust or negligence for a loss suffered by the company, even if the director was appointed before they became a member.
Accounts and Auditors
- The existing accounting provisions have been re-drafted to bring all relevant provisions for small companies together in one part of the Act, and all provisions for public and quoted companies together, to make it easier to find the provisions. However, there is little change of substance
- The accounts filing date for a private company is shortened to 9 months after the end of the relevant accounting reference period.
- The Bill contains provisions which will allow auditors to limit their liability to the company by contract.
- The Bill also creates a new offence for an auditor to knowingly or recklessly issue an audit report which is misleading or false in a material particular. This offence is punishable by a fine rather than a prison sentence.
Companies House
- The Registrar is given greater powers to correct and amend information on the public register.
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