ENHANCED COMPETITIVE POSITION
The initiatives undertaken by Nevis over the years have resulted in Nevis being recognised as a predominant jurisdiction with many competitive advantages. Of notable mention are the following:
- A stable Government based upon the Westminster model of Government and continuity of national policy.
- A stable and secure economy with a strong currency.
- A favorable time zone location.
- Easy accessibility to Europe and North America.
- Temperate climate.
- World-class accommodation facilities.
- A solid reputation with the commitment to having a proper regulatory regime.
- World class cutting-edge legislation.
- Over 50 highly qualified trust and asset management companies, registered agents and other service providers with expertise in law, accounting, banking, taxation & finance.
- A wide range of developed support services, such as state-of-the-art telecommunications facilities, professional and competent attorneys and accountants and a range of local, regional and international banking institutions.
- A newly renovated airport including a longer runway, a modern tower and a new terminal building.
- A population with a 98% literacy level.
- An adaptable and trainable workforce.
- Easy registration of companies and large availability of names.
- No personal income taxes.
- Exemption of offshore companies from income, social security, capital gains, with-holding, gift, estate and succession taxes.
- The granting of tax holidays, concessions and exemptions to qualified companies under the Fiscal Incentives Act.
- Reasonable incorporation and annual renewal fees.
- A jurisdiction whose watchwords are quality, innovation and integrity.
NEVIS INTERNATIONAL FINANCIAL SERVICES LEGISLATION
The four major pillars of the Nevis international financial services industry are the Nevis Business Corporation Ordinance, 1984 (NBCO); the Nevis International Exempt Trust Ordinance, 1994 (NIETO); the Nevis Limited Liability Company Ordinance, 1995 (NLLCO); and the Nevis Offshore Banking Ordinance, 1996 (NOBO).
The Nevis Business Corporation Ordinance (1984) (NBCO)
Under the NBCO, a company may be incorporated to conduct any lawful business, and it is not necessary to enumerate the particular objective for which the company is incorporated. The registration process is quite simple and easily accomplished. It is important to note, however, that no person is authorised to carry on or hold himself out as carrying on domestic banking, international banking, or insurance business from and within Nevis unless that person is appropriately licensed under the Domestic Banking Act, the Nevis Offshore Banking Ordinance, or the Insurance Act, as applicable.
Furthermore, an offshore company registered in Nevis is required to maintain a registered agent at all times and a registered office in Nevis. The Ordinance allows the office of the registered agent to act as the office of the company. The registered agent must be appropriately licensed by the Minister of Finance.
Names of Companies
A registered agent may electronically reserve a name with the Registry in seconds at any time of the day or night, with the company being registered in one day.
Transfer of Domicile
One of the most striking features of the Ordinance is the allowance of emergency transfer of domicile to Nevis. Thus, during periods of strife, war and civil unrest, a company may easily transfer its domicile to Nevis. Moreover, in certain circumstances, the Registrar of offshore companies has the discretion to permit the emergency transfer of domicile without the company first submitting the required paperwork.
The Nevis International Exempt Trust Ordinance (NIETO)
The NIETO provides not only for the creation of charitable, spendthrift and protective trusts, but also includes special provisions that make Nevis arguably one of the preferred jurisdictions for the establishment of asset protection trusts (APTs). Some favorable features of this ordinance include the following:
- The trust assets and income deriving from the corpus of an international trust are exempt from all exchange controls and estate, corporate, gift, income, inheritance, withholding, succession and stamp taxes in Nevis.
- The international trust can be created with only a single trustee, and the settlor or trustee of the trust may also be named as beneficiary.
- An important feature of the Nevis Trust Ordinance relates to fraudulent dispositions. A creditor seeking to set aside a transfer to an international trust is required to establish beyond reasonable doubt that the transfer constituted a fraudulent disposition. Furthermore, every creditor, before bringing any action or proceeding against any trust property, shall first lodge a bond as a security deposit.
- Another feature of the NIETO is that it provides for the appointment of a protector. The protector’s function is to monitor the acts of the trustees. The powers conferred on the protector are determined by the trust document. This is an important additional protective feature, as the protector owes a fiduciary duty to the beneficiaries of the trust or to the purpose for which the trust was created. Such a feature enhances the safety mechanisms within the framework and working of a trust.
The Nevis Limited Liability Company Ordinance (1995) (NLLCO)
The Nevis LLC is a business entity that provides an alternative to those who might consider using partnerships or corporations. While most U.S. LLC statutes, as does the Nevis LLC Ordinance, protect the company’s assets from the creditors of its members through the limitation of creditors to a charging order, the Nevis LLC Ordinance goes further to specify that this is the exclusive remedy available to the creditor. Also, the Ordinance gives the company the power to redeem the interest of creditors.
The Nevis Offshore Banking Ordinance, 1996
The offshore banking legislation is comprehensive and ensures that a bank licensed under the legislation can be properly monitored to safeguard depositor’s funds and to ensure that the bank maintains acceptable accounting standards and satisfies capital requirements.
To deter the establishment of brass-plate banks and protect the reputation of the jurisdiction, section 6 of the Ordinance provides that no license can be issued to an individual. Licenses are only granted to eligible subsidiaries of local banks incorporated under the Domestic Banking Act or a qualified foreign bank.
THE WAY FORWARD
Nevis has weathered the storms of the recent challenges posed by the FATF, the OECD, the attacks on the USA and the war and has proven to the world that it is resilient. The Nevis Island Government has enacted numerous initiatives to jealously guard its impeccable reputation and has continuously demonstrated its commitment to the development of a solid international financial services sector. Although the Federation has been removed from the FATF and OECD lists, Nevis is mindful that it must not relax its guard but must continue its efforts to upgrade its regulatory infrastructure. It is also committed to monitoring its legislative and regulatory institutions to ensure that it complies with international best practices and to ensure that only persons with the highest degree of integrity are permitted to conduct business activity on the island.
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.