DOING BUSINESS IN MARSHALL ISLANDS IN 2020
When structured properly, company registration in Marshall Islands is an ideal, tax-efficient way to conduct international business. Further information can also be found in this Marshall Islands incorporation guide.
Summary table of Marshall Islands company registration
|Summary||Tax resident LLC||Fast business setup solution||Free zone LLC||International business company||Trust||Branch office|
|Also known as||LLC||Shelf company||Exclusive economic zone company||IBC||Trust fund||Branch of a foreign company|
|Best use of company?||All products and services||Own or operate a vessel||Maritime activities||Professional services||Asset management||Specific projects|
|How soon can you invoice Clients/sign sales contracts?||3 weeks||2 weeks||3 weeks||3 weeks||4 weeks||4 weeks|
|How soon can you hire staff?||2 weeks||1 week||2 weeks||2 weeks||3 weeks||3 weeks|
|How soon can you sign a lease agreement?||1 week||1 week||1 week||1 week||1 week||1 week|
|How long to supply corporate bank account numbers?||4 weeks||3 weeks||4 weeks||4 weeks||4 weeks||4 weeks|
|How long to supply company registration/tax numbers?||2 weeks||1 week||2 weeks||2 weeks||3 weeks||3 weeks|
|Corporate tax rate on annual net profits?||0%||0%||0%||0%||0%||0%|
|Limited liability entity?||Yes||Yes||Yes||Yes||Yes||No|
|Government grants available?||Yes||Yes||Yes||Yes||No||Yes|
|Government approval required for foreign owners?||Yes||Yes||Yes||Yes||Yes||Yes|
|Resident director/partner/manager/legal representative required?||No||No||No||No||No||Yes|
|Minimum paid up share capital?||US$1||US$1||US$1||US$1||US$1||None|
|Can bid for Government contracts?||Yes||Yes||Yes||Yes||No||Yes|
|Corporate bank account location?||Bank of Marshall Islands||Bank of Guam||Citibank||National Australia Bank||HSBC||Bank of America|
|Can secure trade finance?||Yes||Yes||Yes||Yes||No||Yes|
|VAT payable on sales to local customers?||0%||0%||0%||Cannot trade locally||0%||0%|
|Average total business set up engagement costs?||US$8,530||Request a proposal||Request a proposal||Request a proposal||Request a proposal||Request a proposal|
|Average total engagement period?||2 months||2 months||2 months||2 months||3 months||3 months|
Marshall Islands company registration summary
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Advantages and disadvantages
Advantages of Marshall Islands company registration
- If properly structured, setting up an offshore company in Marshall Islands is a legitimate way to book international profits without paying tax. The Marshall Islands is an ideal jurisdiction to establish a holding or Marshall Islands investment company;
- Under the Marshall Islands business incorporations act, a minimum of one shareholder and one director is required for Marshall Islands business setup. They need not be resident in the Marshall Islands, and can be of any nationality;
- There is no public Marshall Islands registered company disclosing shareholders’ and directors’ details;
- There are no minimum capital requirements for Marshall Islands company formation;
- Following Marshall islands company incorporation, it is not necessary to submit annual financial statements and tax returns to the government;
- It is simple to open global corporate bank accounts to support Marshall Islands business setup. Healy Consultants works with internationally recognised banks such as HSBC, Standard Chartered and Citibank to provide corporate bank account services;
- Marshall Islands company incorporation can be completed in 7 days and our Client will not need to travel to complete the engagement;
- Company registration in Marshall Islands requires one shareholder, a minimum of only one director and one company secretary, who can be a natural person or a body corporate;
- Marshall Islands serves as an excellent jurisdiction for shipping companies that are willing to invest in an offshore location for their ship and yacht management. The country is one of the largest ship registers in the world that later enables these companies to i) plan on a successful IPO and ii) later list themselves on one of the reputable stock exchanges of the world.
Disadvantages of Marshall Islands company registration
- The Marshall Islands may be perceived as an offshore tax-haven;
- The Marshall Islands ranks poorly as the 153rd least easy place to do business, according to the 2020 Doing Business Survey by the World Bank;
- There is no regulatory regime in the Marshall Islands for financial services. Consequently, it is not possible to set up financial services companies in the Marshall Islands;
- Marshall Islands has imposed several restrictions on foreign investment for small-scale retail and services industries to protect and promote the interest of its economy. The Natural Reserved List outlies all the restricted areas of investment. Moreover, all major industries in Marshall Islands have state-owned enterprises which further makes it difficult for foreign entrepreneurs to successfully establish their businesses in this country.
- From 1 January 2020, the Marshall Islands Government will require all Marshall Islands LLC’s comply with new substance requirements. Failure to comply with the above exposes the shareholders and directors to i) a fine of up to US$10,000 and ii) dissolution of their Company. Refer to this page (click link) for more details;
Best uses for a Marshall Islands company
Secretive offshore centre for holding assets
- Companies in the Marshall Islands are subject to less regulation and oversight than in many of the traditional offshore centres. Because it has not been under pressure from the OECD or similar organizations, it is a great jurisdiction for maintaining privacy of ownership without high ongoing company costs.
- Time to incorporate: One week
- Cost to set up: US$8,530
- Minimum capital: US$0
- Physical office required: No
- Shareholders: 1
- Directors: 1
- Company secretary: Yes
- Resident director: No
- Corporate tax rate: 0%
- Corporate tax base: Territorial
- Shelf companies: No
- Main company type: IBC
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Useful links for Marshall Islands
Government and public authority websites: