A company incorporated in the Isle of Man under the Companies Act 2006 ("2006 Act Company") is well-suited for use as a special purpose vehicle.
The 2006 Act Company
The 2006 Act Company is easy to administer and is subject to reduced regulatory requirements:
- an incorporation fee of £195 and thereafter an annual fee of £360;
- simple and quick incorporation process;
- corporate director and single director (of any nationality) permissible;
- single member (of any nationality) permissible;
- confidentiality of the register of directors, shareholders and charges;
- no applicable fees payable to register a security;
- less prescriptive accounting requirements;
- no annual general meeting obligation;
- no financial assistance or directors' loans prohibition;
- simplified offering document requirements; and
- easy conversion of the company structure to that of a protected cell company.
Further, the directors of a 2006 Act Company are able (subject only to a simple statutory solvency test) to:
- declare and pay dividends and make capital distributions (including distributions of assets in specie); and
- effect a purchase, redemption or acquisition of the company's shares.
The benefits of using the Isle of Man as a jurisdiction
In addition to the flexible nature of the 2006 Act Company, the benefits of the Isle of Man include:
- conveniently located, in the same time zone as London;
- the Isle of Man's first-class reputation as a responsible, co-operative and well regulated international finance centre (reinforced by Moody's and Standard & Poor's "AAA" rating);
- placed on the "white list" by the OECD in April 2009;
- Isle of Man company law is derived from English law;
- the Isle of Man's favourable tax regime: a zero percent income tax rate for companies and no capital gains tax, inheritance tax, stamp duty (including on share transfers) or withholdings on dividends; and
- the ability to obtain a stock exchange listing without the need for prior regulatory approval in the Isle of Man.
Isle of Man corporate vehicles have direct access to global capital markets and have an established record of listing on recognised stock exchanges in London, Singapore, Frankfurt and Toronto. The Hong Kong Stock Exchange (HKSE) has also recently approved the Isle of Man as an Acceptable Overseas Jurisdiction thus paving the way for the flotation of Isle of Man holding companies on the HKSE.
Cains is a leading Isle of Man law and professional services group. Its legal side is expert in advising clients in the fields of international financial services, commercial real estate structures, space and satellite, shipping and capital markets. The business acts for a broad range of clients including multi-national corporations, financial institutions, regulatory bodies and family offices. Cains also has a strong track record of working in partnership with leading law firms to effect international transactions for clients, including market listings.
Cains fiduciary services business is focused on the provision of services to international businesses and global financial institutions, private companies, family offices and property funds. Core services includes the provision of incorporation, administration, accounting and transaction management services as well as facilitating access to cross border tax planning and structuring advisory services, investment management, private banking and insurance solutions. Ancillary services include assisting clients with succession planning, pensions and employee benefits, yacht and aircraft financing and registrations and high-end residential and commercial property related matters.
Cains is the exclusive Isle of Man Member of Lex Mundi, the world's leading association of international law firms. In addition to the Isle of Man, the company has offices in London and Singapore. The Cains group have recently consolidated all their Isle of Man offices to the landmark Fort Anne Building in the Island's capital, Douglas, allowing them to offer clients an enhanced, seamless, high quality, professional service.
Cains recent accolades include recognition as Offshore Law Firm of the Year by Legal Week (2007) and The Lawyer (2008) and it was awarded a Queen's Award for Excellence in International Trade 2009. Cains has been shortlisted for Offshore Law Firm of the Year by Asian Legal Business (ALB), having been nominated for it every year since opening its office in Singapore.
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.