Entrepreneur invests in Seychelles
Seychelles client case studies: Assisting an inventor to setup his energy based venture in Seychelles
Mike is a British entrepreneur and inventor who developed a number of renewable energy technologies which he plans to sell to governments and non-government organisations around the world. The renewable energy technologies he developed are particularly relevant to the solar power and water desalination sectors, areas Mike believes offer the greatest potential given global water shortages, environmental pollution and the continued high costs of conventional energy.
To turn Mike’s technologies into economic reality, he needed a secure global structure which would protect his intellectual properties, enable him to patent his technologies, be tax-efficient and which would also provide a good image to prospective investors and lenders. Mike also planned to build a state-of-the-art demonstration facility in South Africa, which would produce solar-powered geothermic water, as well as set up an offshore wind-based water desalination plant.
Mike contacted Healy Consultants in late 2004 to discuss how we could assist with his venture. For the Seychelles component of the engagement, we described the legal, tax and accounting implications of incorporating in the Seychelles. It was decided that a global corporate structure would be required to handle different aspects of the company’s assets – and that a Seychelles company would be used to hold the intellectual property and apply for technology patents. With this in mind, we sent Mike an e-mail cost proposal, an overview of likely incorporation timeframe and information required by our company in order to proceed. Mike replied with a scanned copy of our Client Engagement Letter, outlining his preferred corporate structure and company name. He also transferred engagement funds to us, prompting our Incorporation Team to begin the engagement in earnest.
While we were waiting for a courier from Mike containing due diligence, Healy Consultants approached the Seychelles Registrar of Companies (ROC) to check if the preferred company name was available. The ROC responded by e-mail within 2 working days to confirm that the name was available for incorporation and had been reserved. Healy Consultants then obtained a company incorporation application form the Seychelles International Business Authority (SIBA), which included details of the names, nationalities and addresses of directors and shareholders, as well as our registered office address in Seychelles. We also sent due diligence required by SIBA, including passport copies of shareholders and directors, proof of address and bank reference letters, by e-mail to the ROC.
At the same time, Healy Consultants prepared pre-incorporation documents, including the memorandum and articles of the proposed company, a statutory declaration by an officer of the company and consent of the persons to be appointed director. These were couriered to Mike for his signature and return to us, which was achieved within one week. Ten days after submitting the full incorporation application pack to the ROC, Healy Consultants received an e-mailed Certificate of Incorporation for the Seychelles company, confirming that the company had been fully incorporated with the correct corporate structure. Four days later Healy Consultants’ Singapore office received a complete company kit from the SIBA office in Seychelles, including an original Certificate of Incorporation, share certificates, a bound copy of the Memorandum and Articles, and a company seal.
With the incorporation phase complete, Healy Consultants was tasked to assist in opening a corporate bank account to support the company. We warned Mike that opening a corporate bank account for a Seychelles company in our preferred banking jurisdictions of Hong Kong and Singapore was challenging because the banks require detailed evidence of the company’s activities (including contracts and invoices), and also consider the Seychelles to be a tax haven. With this in mind, we prepared a detailed business plan to accompany the application. The plan outlined exactly what the company would be doing, details on the bank signatory (Mike) and brief financial projections. We were also able to provide a workaround solution on the issue of contracts and invoices to satisfy the bank’s requirements.
The business plan, along with a completed bank account application form, was sent to Mike for his signature and return to us, which he did within one week. We were then in a position to approach the bank, submitting the signed documents and due diligence supplied by Mike at the beginning of the engagement, and lodging a US$2,000 deposit, as required by the bank. The engagement ended when Healy Consultants received notification that the bank account had been approved, and sending in separate sealed envelopes ATM cards and PINs, which were sent to Mike in the UK by secure courier.