Registering Companies Abroad

Establishing a business overseas is one of the most crucial stages of international tax planning. Incorporating in a country with the most favorable conditions for conducting entrepreneurial activities solves many problems hindering business development. However, registering companies abroad is complex since it requires deep knowledge of the country’s legislation where you want to open a business. With the assistance of legal consulting firms specializing in business registration in different countries, it is possible to navigate this process. Dynasty Business Adviser is one such firm. We have analyzed the peculiarities of the registration process in various jurisdictions and decided to provide more detailed information on how to open a company abroad.

Why Register a Company Abroad

Entrepreneurs may have various reasons for incorporating a new business or relocating an existing company to another country:

• It’s worth finding a jurisdiction with a more favorable tax system to optimize tax expenses than in one’s own country. Today, many countries are not offshore but offer tax incentives to foreign investors.
• Expand the business and find new markets, especially if the products and services offered are in low demand in one’s own country.
• To gain economic benefits by minimizing startup costs and business maintenance expenses. Today, it’s possible to find jurisdictions with low startup prices where a company can be opened abroad with minimal authorized capital or without the mandatory deposit of such capital into a bank account. Some countries offer incentives for startups during the first years of operation.
• To attract investments and cheaper loans available in EU and US countries.
• To minimize the risks of financial losses due to instability in the economic and political life of the country of permanent residence. Additionally, registering a company abroad can help avoid pressure from competitors and attempts of hostile takeovers.
• It should be incorporated into a more prestigious jurisdiction to increase trust in the business from counterparties, potential clients, and investors.

For many entrepreneurs, the possibility of obtaining a residence permit and even citizenship in another country is also significant.

Aspects to Consider When Opening a Company Abroad

When choosing a country to open a company abroad, it’s necessary to consider the following essential aspects:

• The simplicity and convenience of registering a legal entity: if the process is complex, filled with numerous bureaucratic procedures, or requires the mandatory presence of founders, and if the benefits do not outweigh the bureaucracy, it’s advisable to reject such jurisdiction immediately.
• The characteristics of the tax system are the overall tax burden, availability of tax incentives, and special economic zones with preferential taxation for foreign businesses.
• Specifics of conducting the chosen type of activity in the country where you want to register the company. It’s important to understand that the conditions for developing business in different countries can vary significantly.
• Stability in economics and politics: Political upheavals, economic crises, legislative instability regulating business rules, and frequent drastic changes in existing laws hinder the normal development of any business.
• Understanding the mentality of the country’s population will help establish effective interaction with government authorities, business partners, and potential clients.

Countries Suitable for Opening a Business Abroad

The most popular countries among foreign investors for opening businesses can be divided into three categories:

• Classic offshore jurisdictions: These countries have no taxes, currency control, or requirements for financial reporting. They maintain confidentiality regarding the data of foreign companies’ ultimate beneficiaries and activities. However, firms registered in offshore jurisdictions cannot operate within the territory of the registration country. The most popular offshore jurisdictions include the British Virgin Islands, Saint Kitts and Nevis, and the Seychelles. The relevance of offshore jurisdictions has significantly decreased due to ongoing efforts, but these countries can still be suitable for registering businesses abroad for specific purposes.
• Low-tax jurisdictions: This is the most popular group of countries among entrepreneurs looking to open businesses in other countries. Their low corporate tax rates attract foreign investments into the economy. This category includes the UAE, Singapore, Hong Kong, Cyprus, Bulgaria, Estonia, and other countries. They also have free economic zones with special tax regimes for specific business sectors.
• High-tax jurisdictions with tax incentives: These countries have high taxes but offer tax breaks in certain areas. They also provide various legal instruments to reduce the tax burden. Examples of countries in this category include the United Kingdom, Switzerland, Luxembourg, the United States, Canada, and others.

At the same time, the most popular and attractive jurisdiction in the world for registering a company abroad is the United Arab Emirates. The main advantages of this country are:

• Stability in economics and politics.
• A simple registration procedure without the mandatory presence of the founder, with the support of experts from Dynasty Business Adviser, means you only need to visit the Emirates for the bank account opening stage.
• Low tax burden — most companies only pay 5% VAT and 9% corporate income tax. Both taxes have a non-taxable minimum of 375,000 dirhams. The 0% profit tax rate also applies to companies engaged in qualified activities, with the list of such business types determined by the Cabinet of Ministers.
• Absence of customs duties — only 5% is levied on imported goods intended for sale in the UAE.
• 45 free economic zones are available, offering tax incentives, with three allowing offshore companies to be established.
• Full foreign ownership of the company for most types of activities.
• Possibility of obtaining a UAE residency visa (equivalent to a residence permit) for shareholders, their family members, and company employees.
• Avoid double taxation by obtaining company tax residency status.
• Complete confidentiality is achieved thanks to registration in a registry closed to public access and the absence of information exchange with tax authorities of other countries.

Moreover, the UAE is a significant financial center where local and leading international banks operate. The country’s location at the crossroads of transportation routes and well-developed infrastructure provide companies operating in the Emirates access to European, Asian, and African markets.

If you are interested in opening a company abroad and choosing the Emirates, contact Dynasty Business Adviser! We are a licensed registrar of onshore and offshore companies in this country and will help you start your business quickly and hassle-free.

How to Prepare for Registering a Company Abroad

To register a legal entity abroad, you need to:

1. Choose a suitable jurisdiction based on the type of activity you wish to engage in and the peculiarities of conducting business in different countries.
2. Determine the legal form of the company. For small and medium-sized businesses, a partnership or a limited liability company is usually the best option, while for larger businesses, other options may be considered. To make the right choice, consult with specialists from our company who will explain the pros and cons of different legal forms.
3. Clarify what taxes and other mandatory payments are required in the country of registration for your business and type of activity. Compare these expenses with projected income.
4. Find a registrar — a company that assists investors with registration procedures in the chosen country. Consult with the lawyers of this firm regarding the necessary documents and registration process specifics.
5. Gather the required documents and legalize them according to the legislation of the chosen jurisdiction.

How Company Registration Abroad Works

Registering a legal entity in each country may have specific features. The list of documents required for this may also vary significantly. However, it is necessary to provide the following:

• Personal documents of the applicant.
• Founding documents for the new legal entity.
• Description of the business you plan to engage in, including information about counterparties, projected turnover of funds, and the purpose of using the corporate bank account.
• Recommendations from business partners and the applicant’s bank, as well as bank statements from the accounts of the applicant and all beneficiaries.

Additionally, the registrar may request any additional documents, approvals, and permissions from local authorities for the registration of a non-resident company.

In general, the registration process involves:

1. Choosing and reserving a unique name for the new company in the registry.
2. Obtaining approval for company formation.
3. Declaration or contribution of the share capital, depending on local legislation requirements.
4. Payment of fees.
5. Submission of documents to the registration authority.
6. Obtaining a certificate of company registration and registered founding documents.

Considering the need for a thorough understanding of local legislation and the possibility of refusal of registration due to errors in document preparation, it is advisable to entrust the opening of a company abroad to a specialized registrar company. To open a business in the UAE, Bahrain, or Qatar, you can order a turnkey company registration service from Dynasty Business Adviser.

Stages of Business Registration Abroad

It is necessary to undergo the procedure of registering a legal entity to open a business abroad. The method includes the following stages:

1. Consultation with a professional lawyer from a consulting company regarding the legislation of the country you are interested in, particularly concerning various types of activities conducted there.
2. The preparatory stage includes working with documentation.
3. Completion of the registration procedure in cooperation with government agencies.
4. The final stage is opening a corporate bank account, registering with the tax authority, and obtaining licenses.

How We Work: Cooperation Process with Dynasty Business Adviser

If you want to open a company abroad — in the UAE, Qatar, or Bahrain — our specialists can make the registration process as quick and straightforward as possible. To do this, you need to:

1. Receive initial consultation.
2. Sign a contract to support the registration process and the turnkey business opening.
3. Provide us with all necessary documents.
4. Wait for the registration certificate and visit the country to open a bank account.

Our article is purely informative and should not be considered legal advice. If you are planning to open a company abroad and want to consult with a professional lawyer, please contact the Dynasty Business Adviser managers!