Anguilla: Anguilla: Instant Incorporation At Your Fingertips

The efficient and speedy formation of companies has long been a pre-requisite of the offshore industry. At long last, state of the art technology has unveiled itself in the form of Anguilla’s interactive on-line company registration system-ACORN. Anguilla’s Financial Services Department provides an insight into the many advantages of doing business offshore and on-line from the comfort of your own office with the latest technology.

First, spare a thought to just some of the many direct benefits resulting from ACORN in terms of the hard facts of business life. The most obvious factor on introduction of the on-line service is Anguilla’s ability to dramatically cut costs. It is now possible to incorporate an International Business Company for as little as US$300, inclusive of Government incorporation fees and, registered office / registered agent fees for the entire life span of the company. More so, compare this fee to those currently being advertised by other practitioners in established jurisdictions, who continue to rely on paper as their business medium. In an industry where few incorporators maintain a physical presence in the jurisdiction of the service provider itself, ACORN must surely be the obvious choice, because there is a virtual presence.

A further advantage is the ability to cut out the on-island middleman when undertaking many routine registry activities, such as payment of annual license fees and other forms of statutory filings, and the benefits really do start to add up significantly. In an industry where very few practitioners maintain a physical presence in the jurisdiction of the service provider itself, ACORN must surely be the obvious choice, because there is a virtual presence.

Quite simply, ACORN allows overseas practitioners to serve their clients needs direct. What will you be doing next time your client wants to change their company name and more importantly, how long will it take and what will it cost? Through ACORN, every transaction undertaken is instant. All incorporations, which are accepted by the system, are effected instantly and online and all other filings submitted to the Registrar are, on average, processed within 15 minutes of receipt. Secondary benefits, but nonetheless just as important, are the inevitable reduction in courier and communication costs. Overseas agents using the system are already reporting that such costs have been significantly reduced. The modern technology employed by ACORN will in time provide significant monetary savings for those directly involved with the industry and just as important, for their clients. This is what a major service provider says about ACORN.

“OCRA was delighted to be one of the first companies to become an ACORN user. Anguilla has a modern and user friendly set of legislation. The ACORN system is simple to use and the Anguillian authorities have provided excellent support. The licensing procedures are straightforward and are sensitive to the requirements for due diligence. The ability to obtain name approval and incorporate companies within minutes is self-evidently of value to both our clients and our international network of offices. The Group is already saving money on administration as thanks to ACORN the flow of telephone calls, facsimiles and courier packages between Anguilla and our offices is less than that for any other jurisdiction. ACORN is a thoughtful and all embracing implementation of an idea that many have discussed and only Anguilla has implemented. It will be a great success”

Mr.Chris Oldfield, Director of Overseas Company Registration Agents Limited OCRA

ACORN allows users to conduct all company registry business direct and on-line with the Registrar of Companies. Effectively, it has done away with paper. Users can file anything from Articles of Incorporation in a variety of languages, to notification of a merger or consolidation and the system will guide users on the legal pitfalls which inevitably go hand in hand when completing any registry’s statutory document. Incorporations are effected immediately, with ACORN providing a copy of the company's Certificate and Articles of Incorporation instantly online. Hard copies of all certificates generated are also provided through the local licensed company manager. The system even enables users to call up online reports, detailing transactions already undertaken and the costs and dates of those transactions. This system is technology at its very best.

ACORN is a state of the art Companies Registry system developed by Anguilla with financial assistance from the UK Government. It allows the electronic incorporation and registration in Anguilla of:P>

• Ordinary Companies;
• International Business Companies;
• Limited Liability Companies; and
• Limited Partnerships.

Using ACORN companies can be incorporated instantly from anywhere in the world 24 hours a day, 365 days a year. ACORN also enables all other corporate registration activities permitted under the relevant legislation to be undertaken on-line.

The system is available to all licensed practitioners within Anguilla and to their overseas agents. In order to access the Registry services directly, overseas agents must be registered with the Financial Services Department of the Government of Anguilla. There is no government charge for becoming an overseas agent or for access to the system.

The system allows a user to do electronically all of the things that currently require physical filings with the Anguilla Companies Registry. Registered users are provided with secure digital encrypted access to the system, supplemented by individual user password controls. The ACORN menu allows a user to choose one or all of the following functions:

• Administration;
• Name Search;
• Name Reservation; and
• Incorporation

This enables a user to:

• Establish user password control;
• View all fees;
• Do full company searches;
• Review announcements;
• View the legislation relevant to a document being submitted or to an activity being undertaken;
• Obtain help with respect to any function of the system at any time; and
• Retain incomplete documents in a separate pending file.

This can be done alphabetically, phonetically or on a key-word basis. This system gives immediate confirmation as to whether a name is free, not free or reserved.

A free name may be reserved for 10 days without charge or for a longer period upon payment of the reservation fee. The system allows multiple searches and reservation (initially up to 20 names) and the names of companies and their articles can also be incorporated in foreign languages. Name reservation ability plus the instant incorporation facility dispenses in the main with the need for shelf companies.

Incorporation on-line has been made as straightforward as possible:

• A user must select one of the types of available company or partnership.

• The system will then take the user through the incorporation process with information being typed directly into the system.

• Standard sets of articles of incorporation can be pre-established in the system for use on incorporations.

Once completed, the screen will provide the user with the registration document for checking and final submission.

On submission, the certificate of incorporation appears immediately on screen and can be printed out.

The whole registration process is simplicity itself.

For each of the corporate vehicles and limited partnerships, a sub-menu is available which lists all documents and registry activities, which the relevant legislation either permits or requires the company or partnership to file. In each case, the system takes the user through each process with a help button and a legislation reference button which are available at all times.

ACORN additionally facilitates the following:

• It allows the user agent to monitor and to review all activity or individual activities for any chosen period;
• It provides a full accounting system for both the user agent and the registry
• It provides a full administrative system for the registry for both monitoring activity and assisting user agents in their usage of the system

Overseas agents can be authorised to incorporate companies on behalf of their clients. The procedure for registration as an overseas agent is as follows:

• The overseas agent must establish a commercial agency agreement with an Anguillian licensed practitioner, which will, amongst other things, satisfy the requirement for a registered office in Anguilla.

• The Anguilla agent will have to satisfy it as to the fit and proper qualities of the overseas agent.

• The overseas agent must then register with the Financial Services Department by means of a simple application, which is available on the website. www.anguillaoffshore.com

A CD-ROM demonstrating the ACORN system will be available as a user guide to the system.

All agents, whether local or overseas, will be required to credit ACORN with a sum of money appropriate to the volume of business which the agent anticipates undertaking. Payment, which is left to the discretion of each agent since there is no minimum nor maximum amount, is made through the Government of Anguilla and an overseas agent can do this either directly or in conjunction with its licenced practitioner in Anguilla. In either case, when an activity is undertaken, the system will show an on-screen record of the cost of each transaction together with the balance of the account still available. The fees applicable to each activity can be checked directly under the “Enquiries” menu on the system.

• ACORN is an interactive system, which is both user friendly and easy to understand.

• ACORN provides checks and guidance for the user at crucial stages of the input process.

• ACORN responds instantaneously allowing incorporations and submission of documents to be done anywhere and at any time.

• ACORN allows the user to do electronically and in a fraction of the time all those activities, which ordinarily would be done in paper form.

• ACORN provides a seamless way of incorporating companies offshore.

• ACORN makes the administration of offshore companies fast, cost effective and simple.

• ACORN allows 24-hour electronic access to the Anguilla Companies Registry.

• ACORN permits the incorporation of names and filing of articles in languages and script other than English.

• ACORN has the regulatory controls in place to ensure that users are fit and proper.

As part of the ACORN launch process, a CD-ROM user guide will become available during May 1999 to prospective overseas agents.

To reinforce Anguilla’s position at the forefront of electronic company registration, for documents submitted electronically, the Financial Services Department has:

• Introduced a standard IBC incorporation fee of US$250.00, irrespective of the level of authorised capital; and

• Reduced the Government fee for the continuation of companies into Anguilla from other jurisdictions to US$100.00. Those companies with authorised capital of less than US$50,000 will be able to recoup this fee through a reduction of US$100.00 in their first annual fee.

As part of the ongoing review of Anguilla’s corporate legislation development, the following major amendments to existing legislation have recently been passed:P>

The International Business Companies Ordinance 1994

This Ordinance has been amended to include the following major points:

• an IBC may not hold real property situated in Anguilla, except an office to be used for running its business
• an IBC may use a name of a previous company which has been struck off the register for more than 3 years
• an IBC may issue various types of shares and other securities subject to its articles or by-laws
• an IBC may have an authorised capital in any currency approved by the Registrar
• provisions covering the definitions and consequences of an IBC making unlawful distributions
• an IBC may create mortgages and charges of shares
• provisions covering consequences and actions required of an IBC when a registered agent ceases to act for it
• an IBC may have only one director together with provisions for meetings and resolutions of the company, where only one director exists
• provisions regarding proper accounting records
• a company incorporated elsewhere may continue as an IBC in Anguilla, even though the laws of the jurisdiction in which it is incorporated do not permit its continuation
• provisions clarifying the liquidation and dissolution of an IBC by the Court
• provisions clarifying the duties of an official liquidator of an IBC
• an IBC is exempted from all taxes and from registration of documents
• provisions allowing a shareholder or debenture holder of an IBC to apply to the Court to carry out an investigation and the powers of the Court in this regard
• an IBC may elect to register directors and shareholders and may subsequently elect to cancel such registration

This Ordinance has been amended to include the following major points:

• provisions clarifying the requirement for shareholder meetings and the requirement for Companies to keep proper accounting records
• provisions covering consequences and actions required of a Company, when a registered agent ceases to act for it
• provisions clarifying the requirements of annual returns to be filed by Companies
• the inclusion of detailed new merger and consolidation provisions
• provisions covering the revival of a Company by both the Registrar and the Court
• the inclusion of detailed enforcement measures and other protective actions by members of a Company

This new Ordinance has been introduced for the purposes of the ACORN online system

• to provide for the keeping of registers by the Registrar of Companies
• to permit the filing of documents in both paper and electronic form
• to permit the use of digital signatures
• to include register inspection provisions.

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.

This article also appears in the 'International Offshore and Financial Centres Handbook 1999/2000'. For further information about this highly informative guide to offshore centres, or to order your copy, please phone +44 (0) 207 820 7733 or send an email to iofch@mondaq.com