Offshore in 2015

Offshore in 2015

Offshore company formation numbers in 2014 were consistent with the growth patterns of 2012 and 2013. However, there were periods of stagnation during the year owing to the multiple changes in international tax compliance. Almost all of 2014 saw the industry consolidating as per the new AML/FATCA and regional laws and regulations and as 2015 starts, the investor or the client is now better informed of the implications of starting an offshore entity for his business.

Compliance and conducting ethical business will be the way ahead that all countries trying hard to ensure that investments by its citizens do not go out of the country in a manner unhealthy for its economy. The industry image has been a constraint resulting in service providers and offshore jurisdictions working on image building exercises to showcase the industry as AML compliant tax optimization gateway rather than tax avoidance tool.

Here are few trends that we see that the industry will bear witness over 2015.

Asia Pacific Rim Jurisdictions.

Though in the news for wrong reasons the Virgin Island companies will still witness demand and growth however we do see a shift of the offshore company incorporations from the European and Caribbean jurisdictions to the Asia Pacific rim with Jurisdictions like Mauritius, Seychelles and Hong Kong along with the RAK (Ras Al Khaimah) companies in the Middle East.

China and Africa will continue to be the biggest trade markets.

China is the second largest economy by GDP, and the largest by way of purchasing power. With a population of over 1.3 billion, China plays an influential role in shaping the changing global economy. Organizations from across the globe are setting up or moving their production units to China and other parts of North Asia due to cost efficiencies. An estimate indicates that the manufactures in China can cut costs by between 30 and 80 percent depending on the labour intensity of the product.

The Great Doors of China are open to welcome the world; It is up to the world to step in; the preferred key to this door being Hong Kong.

Like China, Africa offers businesses a huge maturing market place. Seychelles and Mauritius offer an easy business gateway to the African continent. Both these are strategically located and are a convenient bridge between Europe, Africa and Asia. The convenient location and the growing list of double taxation treaties with countries including China, India, Cyprus, Africa, Sri Lanka, UAE have been major factor for the growth of these jurisdictions in Indian Ocean.

From Tax Planning to asset protection.

Larger corporations and High Networth Individuals are under the constant scanner from governments which are trying to protect their interests. The profile of clients setting up offshore entities are seeing the trend of more and more individual entrepreneurs & HNWIs (High Networth Individuals) using these vehicles to protect their assets and tax optimization rather than tax evasion

In Conclusion

We see a much better understanding by clients and careful usage of offshore companies in the years ahead. Though tax effectiveness will always be first in their minds, they are and will be seeing the larger picture of hassle free, flexibility, ease of incorporation and asset protection these offshore structures will provide.

Depending on the Jurisdiction and the country or markets with which you want to engage with, a carefully planned company structure can deliver these benefits.

With global presence and decades of experience, AM. Abacus can be the trusted advisor to guide you on international company incorporations for the purpose of Trade, Offshore Fund management, Offshore Banking and Insurance, Wealth protection through Trusts and Foundations