Samoa: International Companies

A company can be incorporated under the International Companies Act 1987 ("The Act") as an international company if its shareholders are non-resident of Samoa. A trustee company registered under the Trustee Companies Act 1987 may hold shares in an international company.

International companies –

• may be incorporated under foreign language names, e.g. Chinese, French, Japanese, German
• have no minimum capital requirements and shares may be of no par value ;
• may designate shares in most major currencies and may issue bearer shares ;
• need appoint only one director but there is no obligation to appoint a resident director.
• must appoint either a resident agent or a resident secretary who must be an officer of a registered trustee company. If a resident secretary is not appointed then an international company must appoint a non-resident secretary.
• is not required to file annual financial statements, lodge an Annual Return, appoint an auditor nor hold an Annual General Meeting.
• is not be subject to any form of taxation including stamp duty.
• shall not carry on the business of banking or insurance, unless licensed under the relevant Act.

The International Companies Act 1987 incorporates a number of special provisions which provide

considerable flexibility and unique benefits for offshore corporate structures. These include:

The US style limited liability company may be formed under the Act. The legislation is modelled on the Wyoming Limited Liability Company Act and is designed to ensure that the Samoan LLC entity will be interpreted by the US Internal Revenue Service as a pass through entity for income tax purposes. The LLC can be the most effective entity for investment into the USA and similarly for outward investment by US investors.

International companies may be incorporated under the Act with all documentation written in the Chinese language. The presence of a People's Republic of China Embassy in Samoa facilitates the authentication or notarisation of corporate documents. Such companies are commonly used for investment or joint ventures in China.

The transfer of domicile provisions of the Act allow companies incorporated in other jurisdictions to transfer their registration to Samoa to become international companies; and conversely for international companies to transfer their registration to other jurisdictions.

The Act provides considerable flexibility in regard to reduction of share capital. Specifically, the Act allows:

• a company to purchase and cancel its own shares.
• redemption of shares without maintenance of capital and without the need for a Court order.
• a company to finance the purchase of its own shares.

The Act permits the registration of international companies on a long term basis, i.e. for periods of 5, 10 or 20 years. Upon expiry registration can be renewed on an annual basis or for further long term periods..

Long term companies have special attraction for, inter-alia, project companies, joint ventures, property development companies, film production ventures, holding companies, investment companies and leasing arrangements.

Various forms of debentures may be issued including bearer debentures, registered debentures, secured debentures and perpetual debentures. Where a bearer debenture is issued in circumstances specified by the Act, the rights of shareholders are suspended until such debenture is redeemed.

The Act contains various provisions which enable an international company to operate without issued share capital whilst providing a mechanism for control over such company to be exercised pursuant to the terms of a secured debenture. There is no ownership of the company but control of its operations can be assumed by the debenture holder, i.e. as a creditor of the company.

The use of creditor controlled international companies is especially appropriate for residents of countries which adopt controlled foreign corporation ("CFC") legislation. Such countries include Australia, Belgium, Canada, France, Italy, Germany, Japan, New Zealand, Spain and the United States of America.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.