Company Registration in Vanuatu - Business Starting & Setup

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Company registration
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Legal address per year
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Secretarial services for the first year
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Fees and duties for the first year
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Apostilled bound set of incorporation documents
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Compliance fee
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Nominee service per year
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Bank Account Pre-approval
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Price
БЕСПЛАТНО

БЕСПЛАТНО

500 USD

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Core Services

Incorporation

(including incorporation tax and state registry fee)

Annual government fees

(Stamp Duty) and Companies House incorporation fee

Corporate legal services

(including registered address and registered agent)

Delivery of documents by courier mail

DHL or TNT, at cost of a Courier Service

Nominee Director

Paid-up “nominee director” set includes the following documents

Nominee Shareholder

Paid-up “nominee shareholder” set includes the following documents

Compliance fee

Compliance fee is payable in the cases of: renewal of a company, liquidation of a company, transfer out of a company, issue of a power of attorney to a new attorney, change of director / shareholder / BO (except the change to a nominee director / shareholder)

Basic

simple company structure with only 1 physical person

For legal entity in structure under GSL administration

additional compliance fee for legal entity in structure under GSL administration (per 1 entity)

For legal entity in structure not under GSL administration

additional compliance fee for legal entity in structure NOT under GSL administration (per 1 entity)

For client with high risk Status

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    General

    Vanuatu, formerly New Hebrides, is an independent republic located on an archipelago of 83 islands lying between New Caledonia and Fiji in the South Pacific. Largest of the islands is Espiritu Santo (875 sq mi; 2,266 sq km); others are Efate, Malekula, Malo, Pentecost, and Tanna. The islands extend from north to south for 640 kilometers and have a total area of 12,200 square kilometers.

    The capital is Port Vila is situated on the south-west side of the island Efate and is the seat of government and contains the country’s major financial, retails, education, industrial and tourist facilities.

    The total population of Vanuatu is about 300.000 (2019).

    Ethnic groups of Vanuatu include: Ni-Vanuatu 97,9% (Melanesian); European 1,0%; other Pacific Islanders 0,4%; other 0,7%.

    National currency is Vatu (VUV) which exchanges with the US dollar at the rate of USD1 = VUV 112.2.

    65 of the 83 islands are inhabited. Most of the islands that make up the archipelago range from atolls to volcanic origin with the highest peak about 1800 meters above mean sea level. Vanuatu luxuriates in a tropical maritime climate with characteristic uniform temperature, high humidity and variable rainfall. Winds are generally light except during a tropical storm. The climate of Vanuatu can be defined by two main seasons, the cold (dry) season from May to October with an average temperature of 25 °C and the hot (wet/cyclone) season from November to April with an average temperature of 27 °C.

    Vanuatu is 7 hours before Moscow.

    Vanuatu dialing code is +678.

    Official languages are pidgin (known as Bislama or Bichelama), English, French; more than 100 local languages are spoken on the archipelago.

    A literacy factor is 85.2%.

    History

    Vanuatu or New Hebrides as it was known in the condominium days has been inhabited for over 4000 years. The first settlers are believed to have arrived in 1,500 BC from New Guinea and the Solomon Islands by canoe. The islands were discovered by Europeans by the Spanish Explorer Captain Pedro Fernandes de Queiros in May 1606 and were charted by the British navigator James Cook in 1774, who named the archipelago New Hebrides, after the northern Scottish islands. James Cook was followed by French and English missionaries, traders, and black birders who took local people as slaves to work in the Sugar cane plantations in Queensland, Australia.

    Competing British and French claims to the islands led to the formation of a condominium government, allowing for joint British-French rule in 1906. The islands' plantation economy, based on imported Vietnamese labor, was prosperous until the 1920s, when markets for its products declined. Diseases brought by missionaries, sandalwood traders, and others helped reduce the population from approximately 1 million in 1800 to 45,000 in 1935. The islands served as a major Allied base in World War II. After the war, the indigenous Melanesians began lobbying for independence, which in 1980 the country achieved, and after some 74 years of joint "Condominium" rule between Britain and France, Vanuatu finally received its independence on the 30th July 1980 and was then renamed Vanuatu.

    Government

    Vanuatu is a parliamentary republic. The Constitution was passed on 30 July, 1980. The president serves as the head of the state.

    Executive authority is exercised by the cabinet under the leadership of the Prime Minister. Council of Ministers appointed by the prime minister is responsible to parliament. President is elected for a five-year term by an electoral college consisting of parliament and the presidents of the regional councils.

    Legislative authority is exercised by Unicameral Parliament. 52 members of Parliament are elected to four-year terms on the basis of universal franchise.

    Judicial branch vests in Supreme Court which is the ultimate judicial arbiter of both civil and criminal matters. The chief justice is appointed by the president after consultation with the prime minister and the leader of the opposition; three other justices are appointed by the president on the advice of the Judicial Service Commission. There are also a court of appeal and magistrates’ courts, and island courts may be established by warrant to rule on land disputes.

    Vanuatu maintains relations with more than 65 countries, including Russia, the People's Republic of China, Cuba, and Vietnam.

    Economy

    Vanuatu's economy is primarily agricultural; 80% of the population is engaged in agricultural activities that range from subsistence farming to smallholder farming of coconuts and other cash crops. Copra is by far the most important cash crop (making up more than 35% of the country's exports), followed by timber, beef, and cocoa. Kava root extract exports also have become important. Coconut oil, copra, kava, and beef account for more than 75% of Vanuatu's total agricultural exports, and agriculture accounts for approximately 20% of GDP. Tourism is a key driver of the economy.

    In 1980 all freehold titles were cancelled and replaced with leasehold titles. The terms of the leasehold vary depending on the location and land use. There is an annual land lease charge. Other municipal charges may also apply. These charges have historically been low. There is a review of the charges every five years. Fifty year leases (beginning in July 1980) are standard in the major urban areas such as Port Vila and Santo. In rural areas leases range from 30 to 70 years.

    The government has developed Vanuatu's preindependence features to transform Vanuatu into an international off-shore financial center. In 2002, following increasing international concern over money laundering, Vanuatu increased oversight and reporting requirements for its off-shore sector.

    Vanuatu claims an exclusive economic zone of 735,893 square kilometers and possesses substantial marine resources. Currently, only a limited number of Ni-Vanuatu is involved in fishing, while foreign fleets exploit this potential.

    Vanuatu's economic growth of 3.4% in 2006 was broad-based and strongly driven by the services sector, especially tourism at 20% of GDP. Other sectors that contributed significantly were construction (15.7%), wholesale and retail sector (12.4%), and the real estate and business service sector (11.2%). The agricultural sector showed improved performance due to better domestic prices for copra. Other items including cocoa, beef, and kava supported the growth. In 2007 tourism again contributed 20% of GDP. Vanuatu continued to experience strong economic growth through 2008, averaging nearly 6%. There was an increase in agricultural output, which was supported by high international commodity prices in mid-2008. While the global financial crisis did not have a severe impact on Vanuatu’s economy, the crisis caused low commodity prices that led to a decline in the domestic production of most commodities. Higher international prices in 2010 for copra, coconut oil, and beef saw an improvement in the agricultural sector. Construction activity, agriculture, tourism, services, and real estate were the main sectors that drove economic growth in 2010.

    The government's main concern has been to bolster the economy. In keeping with its need for financial assistance, Vanuatu is a full member of the British Commonwealth, the United Nations, the World Bank, the Asian Development Bank, and other international organizations.

    On 24 August Vanuatu officially joined the WTO. Vanuatu has Investment Promotion and Protection Agreement with UK; additional similar agreements are currently being developed with the USA, the Peoples Republic of China, Japan, France, Australia, New Zealand and New Caledonia.

    Vanuatu’s GDP per capita is USD 5,000.

    Unemployment rate is 1.7%.

    General corporate information

    Legal System

    Vanuatu has a mixed legal system of English common law, French law, and customary law.

    Vanuatu’s Constitution states that, until otherwise provided by Parliament, pre-Independence British and French laws shall continue to the extent that they are not expressly revoked or are incompatible with the independent status of the Republic.

    Although Vanuatu had encouraged offshore activity since the 1970s, the offshore sector began to grow more quickly after the passing of the International Companies Act in 1992, and the establishment of the Financial Services Commission in 1993.

    The statutory framework for the operation of the offshore Financial Centre includes as well the Companies Act (based on English Law), and the Banking, Insurance, Stamp Duties and Trust Companies Regulations.

    The OECD designated Vanuatu as an uncooperative tax haven in April 2002. However, Vanuatu managed to stay off the Financial Action Task Force list of uncooperative countries on money laundering by introducing "know-your-customer" guidelines in mid-2002.

    Vanuatu offers a politically stable environment with no direct taxes or exchange controls. Indirect taxes and fees are minimal. The legislative environment in Vanuatu is directed toward the offshore business market and includes good confidentiality provisions.

    The Official Secrets Act and the various companies acts assure the secrecy of information relating to offshore entities. Internal legislation, including the Mutual Assistance in Criminal Matters Act and the Serious Offences Act are, however, directed to the prevention of money laundering activities within the jurisdiction. There is also a Financial Information Unit forming part of the Egmont Group.

    Types of Entities

    The following types of companies are provided for by Vanuatu legislation:

    Local Limited Company: these have full powers to do business in Vanuatu, must have a valid Business License if their activity requires it. They can conduct their business anywhere in the world.

    Local companies can either be public or private. Public companies are entitled to sell shares to the general public if they issue a prospectus while private companies are not allowed to. A local company may be registered as unlimited company as well.

    Exempted Company: previously exempted companies could be formed under the Companies Act. They are severely restricted as to what they can do in Vanuatu. They cannot make contracts or agreements with local companies or persons except in regard to business carried on outside of Vanuatu. They can have bank accounts and agreements with Vanuatu based Banks, Accountants, Lawyers, Trust Companies etc. They can contract with other exempt companies and international companies.

    The International Companies (Amendment) Act No. 11 of 2010 provided for the continuation of existing exempted companies as companies under the International Companies Act effective 8 August 2010. As a result, earlier registered exempted companies continue to carry on business, but the exempted company as a type of companies in Vanuatu no longer exists.

    Exempted companies have following features:

    • an exempted company must have a Registered office, registered agent and a Secretary (possibly through secretarial company) in Vanuatu;
    • there must be at least two shareholders, natural persons or bodies corporate, Vanuatu residents or not;
    • directors of an exempted company can be either natural person or body corporate, a minimum of one director is required, at least one director must be resident in Vanuatu; an alternate director resident in Vanuatu also fulfils this requirement;
    • the board of directors of every exempted company must hold at least one meeting in Vanuatu in each calendar year;
    • exempted companies must file annual returns, but are not required to be audited unless it holds a bank, trust or insurance licence;
    • domestic taxation is not payable on the net chargeable profits of Exempt companies.

    Overseas Company: companies incorporated outside Vanuatu which have established place of business within Vanuatu. Pursuant to the Companies Act an overseas company must apply to the Minister for a permit before establishing a place of business in Vanuatu. Ownership and identity information on an overseas company will be available to its authorized agent in Vanuatu. Registration fee is VUV 30,000; annual fee is VUV 30,000.

    General, Limited or Offshore Limited Partnership: general partnerships are not required to register with the VFSC; offshore limited partnerships and limited partnerships are required to register with the VFSC. Offshore limited partnerships are new to Vanuatu and were first allowed in the Offshore Limited Partnership Act of 2009. An offshore limited partnership must not carry on in Vanuatu any business that an international company is prohibited under the International Companies Act from carrying on.

    Protected Cell Company (PCC) and Incorporated Cell Company (ICC): PCCs are to be formed pursuant to the Protected Cell Company Act; a PCC is a single legal entity with separate and distinct cells within it, created to segregate the company assets. Assets and liabilities of one cell are segregated from those of the other cell; however each cell is not a separate legal entity. ICCs are to be formed pursuant to the Incorporated Cell Company Act; an ICC is an entity where each cell is a separate and distinct corporate entity from the ICC itself. A PCC and ICC can only be a captive insurance company, a mutual fund or a unit trust. Both PCCs and ICCs are also subject to the Companies Act.

    Foundation: can be created in Vanuatu pursuant to the Foundations Act are also required to register with the VFSC. A foundation may be private or public and created for any purpose legal under Vanuatu law. The founders may be an individual or a corporate body. The founder must have company and trust service provider license.

    International Company: the International Company is the most commonly used offshore entity registered under the International Companies Act No 32 of 1992. These cannot do business in Vanuatu except to further their business elsewhere. This category of company provides for more flexibility and simpler administration than an Exempted Company.

    All Vanuatu companies, other than International Companies, are governed by the Companies Act, which is itself based on the UK Uniform Companies Act 1948, which has been used as the basis for company law in most Commonwealth countries. Pursuant to the Companies Act ownership and identity information including in the case of shares held by nominees, is available for all companies and companies are required to register and maintain shareholder register.

    International Companies

    The law governing international companies is set out in the International Companies Act No 32 of 1992. With the passage of this Act, most offshore companies elect to be “international companies” and most exempted companies have now converted to international companies. International companies are administered by the Vanuatu Financial Services Commission.

    Companies that offer their shares to the public, hold banking, trust or insurance licenses, or operate within Vanuatu may not be registered as international companies and must register under the Companies Act.

    An international company can normally be established within one day upon receipt of all required information. To register, the company must file with the Commission only its Constitution which is the Act’s equivalent of a Memorandum and Articles of Association and need contain only the company's name, its purposes (which can be general), its registered office and agent (which must both be in Vanuatu), and whether the company is limited by shares or guarantee. This information on registered international companies makes a part of a public file.

    The following are the key characteristics of an international company (IC):

    • an IC must have a registered office and a registered agent in Vanuatu;
    • the company's constitution, registered office and registered agent are available on public file;
    • there is no minimum capital; the capital can be expressed in any currency;
    • shares can be in registered or bearer form, can be with or without par value, can have full, partial, conditional or no voting rights, and can be convertible, common, preferential or redeemable;
    • the company can have a single shareholder (nominee is permissible) and a single director who need not be resident in Vanuatu and can be natural persons or bodies corporate;
    • there is no need to disclose the names of the directors, shareholders or beneficial owners to anyone;
    • a corporate secretary is not required but is permitted, and the secretary does not have to be located in Vanuatu;
    • an IC does not have to keep or file accounts nor is it required to file an annual return;
    • there are no restrictions or requirements on the holding of an annual meeting.

    An international company may not:

    • conduct business in Vanuatu;
    • own an interest in real estate in Vanuatu except the lease of premises from where it conducts its international business;
    • offer shares to the public;
    • hold a banking, trust or insurance license;
    • solicit the public to deposit with or lend money to the company.

    The International Companies Act imposes a solvency test on ICs - directors are responsible for ensuring that any distribution leaves the IC able to meet its liabilities, and can be personally liable for any shortfall.

    The incorporation fee is USD 150 and the annual registration fee is USD 300. An International Company is exempt from all forms of taxation for 20 years from the date of registration.

    International company formation

    Incorporators

    One director and one (nominee) shareholder are needed for the formation of an international company. Both corporate directors and shareholders are permitted by law.

    Each incorporator is deemed to be a company member (shareholder) until the allotment of any shares in the company. Unless shares are allotted to him, he shall cease to be a member.

    Registration Procedure

    An international company formation must comply with provisions of the International Company Act N32 1992, and Business Names Act.

    International company formation includes the following steps:

    • request for company’s name(s): a request is to be sent to the Financial Services Commission’s fax number and will be answered by the Commission with the name approval to the applicant’s fax number;
    • filing the following documents with the Commission:
    1. the Constitution (must include information on the company’s name, registered office and agent, object and purposes of the company, limited by shares or guarantee or both, directors’ names signed by incorporator or his authorized signatory;
    2. applicant’s covering letter with a fee of USD 150.00.
    • the commission registers the constitution in the Register of International Companies and issue a Certificate authenticated by its official seal stating that the company is incorporated with limited liability.

    As soon as the certificate of registration is received, no other filing is needed, and the company can commence trading.

    For international company formation the incorporator need not visit Vanuatu and may act though his authorized agent. In this case the incorporator (beneficial owner) must provide the following:

    • proposed company names (in three choices);
    • aim and purposes of the company (in short);
    • type of company (limited by shares, guarantee or both);
    • information on beneficial owner(s) and shareholder(s): name, nationality, address, contacts, occupation, % ownership/number of shares (copies of a passport are to be attached);
    • information on director(s): name, nationality, address, contacts, occupation (copies of a passport are to be attached);
    • information on bank account(s) (if applicable).

    Shelf companies are allowed and available, but they are not of great demand, for an international company may be incorporated within 24 hours.

    International Company Name

    An international company must have as part and at the end of its name the following words:

    “Corporation”, “Incorporated”, “Limited”, “Sendirian Berhad”, “Societe a Responsabilite Limitee”, “Besloten Vennootschap”, “Gesellschaft mit beschrankter Haftung”, or their abbreviations: “Corp”, “Inc.”, “Ltd”, “Sdn Bhd”, “SARL”, “B.V.”, or “GmbH”, or any other words or popular abbreviations of those words in any language.

    The name must not be identical with the name of a company registered under International Companies Act or Companies Act in the previous 20 years and may not contain any word or expression that, in the opinion of the Commission, suggests any connection with the Government of Vanuatu or its department, a statutory corporation or board or a local or municipal authority.

    The name must not deceive or mislead.

    If the name of a company is to contain other than Romanized characters or Arabic numerals, a certified translation of the name in either the English or French languages must be provided to the Commission.

    If the name is approved by the Commission, it can be reserved to the person who made the request for six months.

    International Company Constitution

    The constitution of every international company must include:

    • the company name;
    • the address within Vanuatu of the registered office;
    • the name and address within Vanuatu of the registered agent;
    • the objects or purposes for which the company is to be incorporated;
    • whether the company is a company limited by shares, a company limited by guarantee or a company limited both by shares and by guarantee;
    • the Constitution must be signed by each incorporator.

    The constitution must be made based on the model prescribed by the Minister responsible for finance.

    Restrictions on international companies

    An international company is not empowered to:

    • carry on business in Vanuatu;
    • acquire or own an interest in immovable property situated in Vanuatu other than a leased premises for carrying on its business;
    • carry on businesses that require licensing;
    • carry on company management business;
    • at any time have less than one member;
    • make any invitation to the public to subscribe for any shares or debentures in the company or deposit money with or lend money to the company.

    Registration Term

    An international company may be incorporated within 24 hours upon receipt of all necessary information.

    Registered office and registered agent

    An international company must at all times have a registered office and a registered agent in Vanuatu.

    The directors of an international company may by resolution change the address of the registered office or the registered agent, and the company must notify in writing the Commission thereof within 14 days of the change occurring.

    The accounts, records, minutes of all meetings, copies of resolutions, register of the directors, and register of shareholders must be kept at the registered office or at another place as the directors may determine.

    Seal

    A seal is not required under Vanuatu law. A company may have a seal which must have on its face the full name of the company and the words “Common Seal” or “Corporate Seal” and an imprint thereof shall be kept at the registered office of the company.

    Annual Fee

    An international company must on or before 30 June of each year, pay to the Commission an annual fee as follows:

    • USD 300 where the name of the company was on the Register on 31st December of the previous year; or
    • USD 150 where the company was registered on or after 1st January of that year.

    Redomiciliation

    A company incorporated in a foreign jurisdiction may be reregistered in Vanuatu under the Companies Act. Such a company must nominate two Vanuatu residents who can accept notices on its behalf. It must lodge an annual return along with audited accounts. There is an annual fee of VUV 30,000.

    Foreign companies (including International Business Companies from other jurisdictions) can migrate to Vanuatu by way of continuation if that is not expressly forbidden by their home company law. Re-domiciliation in reverse way is also permitted.

    Certificate of good standing

    Upon request of any person the Commission must issue a certificate of good standing authenticated by its official seal certifying that a company is of good standing if it is satisfied that:

    • the name of the company is on the Register; and
    • the company has paid all fees and penalties due and payable.

    The certificate of good standing will contain a statement as to whether the company has submitted to the Commission articles of merger or consolidation, or articles of arrangement that have not yet become effective; the company is in the process of being wound-up and dissolved; or any proceedings to strike the name of the company off the Register have been instituted.

    Winding-up and dissolution

    An international company must commence to wind up and dissolve upon the expiration of such time as may be prescribed in its constitution for its existence.

    An international company may voluntary commence winding up and dissolution:

    • by a resolution of directors if the company is a company with a share capital that has never issued shares;
    • by a resolution of members if the company that has previously issued shares or the company is a company limited by guarantee.

    An international company may be wound up by the court order.

    International company structure

    Directors and shareholders

    An international company must have at least one director that may be a corporate body; there is no residence requirement for the directors.

    Register of directors is to be maintained and kept in the office at all times. A director may be appointed an agent of the company.

    An international company must have at least one (nominee) shareholder and maintain and keep the register of shareholders. The register of shareholders may be in such form as the directors may approve but if it is magnetic, electronic or other data storage form, the company must be able to produce legible evidence of its contents within a reasonable time when required by the Commission.

    Vanuatu law does not establish any requirements or restrictions concerning meetings of the directors or shareholders. Thus, directors may convene the meetings at such times and in such manner and places within or outside Vanuatu as they may determine. Participation by telephone or other real time electronic means is allowed by Vanuatu law. A shareholder may be represented at a meeting of members by a proxy.

    Information on the directors and shareholders is not disclosed to public.

    Secretary

    An international company is not required to have a secretary by Vanuatu law. An appointment of a secretary is up to the company.

    Beneficial Owner

    Vanuatu adopted the transparency rules from the OECD in 2021 and now, at the first request, it is possible to obtain information about the beneficiary through the agency’s corporate website or by request.

    Share Capital and Shares

    Standard currency for share capital and shares is Vatu, though the capital can be expressed in any currency. There is no minimum authorized capital requirement established for an international company by Vanuatu law.

    Minimum issued share capital and minimum paid share capital is one share.

    Shares can be denominated in any currency; the currency in which shares are denominated may be changed. Shares can be in registered or bearer form, can be with or without par value, can have full, partial, conditional or no voting rights, and can be convertible, common, preferential or redeemable.

    Confidentiality

    The following information makes no part of the public file and can not be disclosed unless under the court order:

    • the shareholding in, or beneficial ownership of any share or shares in a company;
    • the management of such company;any of the business, financial or other affairs or transactions of the company.

    The above means, details of the director(s), shareholder(s) and beneficial owner(s) of international companies are not provided to the Vanuatu Financial Services Commission and are not on public record. Section 125 of the International Companies Act specifically provides for confidentiality and makes it a serious offence to divulge this information.

    Information cannot be obtained by overseas authorities unless an order is obtained from the Supreme Court of Vanuatu.

    Offshore business activities

    Types of Offshore Business Activity

    Besides international companies the most important types of offshore business activity carried out from Vanuatu include the following:

    • banking;
    • insurance;
    • trust management;
    • ship management and maritime operations;
    • interactive gaming.

    International Banking

    Until recently, all offshore banking licenses were held through exempted companies.

    Changes to the International Companies Act which came into force on 11 August 2010 makes provisions to bring under the International Companies Act all the exempted companies existing under the Companies Act, of which offshore bank licensee were included.

    The licensing and regulating of an Offshore Bank falls under the International Banking Act 2002 and the Reserve Bank of Vanuatu Act. The International Banking Act defines an offshore bank as banking business that is conducted in a currency other than Vatu and with a person who is not a resident of Vanuatu.

    The licensing of banks is carried out by the National Reserve Bank.

    The features of an International (offshore) bank:

    • the word "bank" or some derivation must be included in its name;
    • one director must to be a Vanuatu resident and one Directors meeting must be held in Vanuatu each year; if necessary, nominee directors can be used;
    • the bank must maintain at all times paid up capital of not less than USD 500,000 or foreign currency equivalent;
    • there is no requirement to maintain a deposit in a Vanuatu Bank; however, the company may hold bank accounts in a Vanuatu bank - in any currency;
    • there is no income tax, direct or indirect taxes on gains, interest or dividends;
    • VAT rating is zero;
    • there is a high degree of confidentiality for "protected persons";
    • (i.e. applicants, licensees, depositors and customers);
    • an International (offshore) bank must have a physical presence in Vanuatu and occupy premises in Vanuatu within 30 days after being issued with a license;
    • an International (offshore) bank must maintain operating records, including financial statements, at its premise, and its employees must operate full time from there. The records are defined by law as: accounting records; books, registers, documents and vouchers; securities and financial instruments; and any record of information or date;
    • an International (offshore) bank must appoint an auditor for each financial year. Auditors must be members of bodies of accountants established in Vanuatu, or in any British Commonwealth country. Furthermore the auditors must be recognized by the Minister of Finance in Vanuatu. Audited financial statements, as well as an annual return of the company, must be submitted every year.

    “Shelf” banks are not available in Vanuatu.

    An applicant for a banking license must submit the following information for assessment by the Reserve Bank:

    • details of ownership, financial capacity and financial history;
    • information on major shareholders and the character and experience of senior management and board of directors;
    • details of risk management, accounting and internal control systems;
    • details of the applicant’s capital structure;
    • a detail business plan outlining the types of services to be offered including a three year projections for assets, liabilities and profitability;
    • a written undertaking that the applicant will provide the Reserve Bank with any information it may require to carry out its responsibilities under the acts.

    There is an application fee of USD 8,000 and the first year’s License fee of USD 8,000 payable and submitted with the application.

    Insurance

    As an offshore financial institution insurance companies in Vanuatu are governed by the Insurance Act and regulated by the Reserve Bank of Vanuatu Act. A company must not act as insurer unless it possesses a license.

    Incorporation of insurance companies in Vanuatu requires application for a permit to incorporate together with an application for an insurance license. The Financial Services Commission is a government agent dealing with insurance license issuance. The applicant requires disclosure of basic details relating to the promoters of insurance companies. Provided the promoters do not have a criminal record or other dubious commercial background, approval by the Minister responsible for commerce is by the usually routine. The application is a confidential document and, for an exempted insurance company, subject to the secrecy provisions of Vanuatu legislation.

    An international (offshore) insurer means an insurance company incorporated in Vanuatu that does not provide domestic insurance products in Vanuatu. Such company must have its principal office in Vanuatu or appoint a licensed insurance manager in Vanuatu to represent the international insurer.

    An offshore captive insurance company is a subsidiary company, wholly owned by a non-insurance company that underwrites the insurable risks of its parent company or of its related or associated companies.

    Similarly, a captive insurer must appoint a licensed insurance manager in Vanuatu to represent the captive insurer.

    An offshore captive insurance company may not deal with the public or insure Vanuatu risks and is exempt from a number of reporting requirements under the Insurance Act.

    The Financial Services Commission applies fairly stringent criteria to applicants for offshore insurance company status. The government needs to be able to verify that the applicants are who they say they are. They will, for example, contact the bank which issues the bankers reference and ask if they did prepare such a reference on behalf of the applicants. Your details will be cross checked with international law enforcement agencies such as Interpol, with insurance regulators of your country of residence etc during the application process. However they will not divulge any information about your plans or application.

    In addition to the Application Forms, the applicant will be required to to provide the following:

    • business Plan for at least 3 years ahead;
    • name of Principal/alternate Principal in charge of the day-to-day operations;
    • two References, CVs (or Resumè) and Qualifications of Principals;
    • police Clearance Report on all Principals;
    • statements of Assets and Liabilities of all Beneficial Owners;
    • a copy of the last income tax report of each Principal;
    • notarized copies of Passports of Principals.

    The incorporation and licensing process for a captive in Vanuatu takes two to three months. Normally the administration of a captive should be based in Vanuatu; however there are companies in Port Vila providing captive management facilities.

    Trust management

    Trust management companies in Vanuatu are considered offshore financial institutions and regulated by the Trust Companies Act. Licenses, which are required for any company acting as trustee, executor or trust administrators, are issued by the Financial Services Commission.

    Trust managers in Vanuatu need to be incorporated as 'local' companies under the Companies Act, since International Companies are not permitted to engage in trust management activity, although they can hold the shares of a company that does.

    To qualify for a license, a trust management company must have:

    • minimum paid-up capital of VUV 12.5 m if its head office is in Vanuatu, or VUV 50m if not;
    • either a head office or a principal office in Vanuatu;
    • at least two corporate officers resident in Vanuatu.

    VUV 200,000 are to be paid upon license issuance; the annual fee for a trust management license is VUV 200,000.

    Vanuatu trusts are formed under UK legislation that applies directly in Vanuatu, including the Trustee Act 1925, the Variation of Trusts Act 1958, and the Law of Property Act 1925. Vanuatu legislation on Trusts includes the Perpetuities and Accumulations Regulation 1974 and the Succession Probate and Administration Regulation 1972. The maximum perpetuity period for a Vanuatu trust is 80 years.

    Vanuatu trusts do not have to be registered and there are no reporting requirements; trustees do not have to be resident.

    Ship Management and Maritime Operations

    An open shipping registry was established in Vanuatu in 1981 under the Vanuatu Maritime Act, which is modeled on Liberian legislation. Administration is provided by Vanuatu Maritime Services Ltd, which has an office in Port Vila, but maintains the registry in New York.

    In order to register a vessel in the Vanuatu registry, it must be owned by a Vanuatu national or a Vanuatu corporation, it must be no more than 20 years old, and it must be in a safe and seaworthy condition at the time of registration.

    Vanuatu Maritime Services Ltd (VMSL) is a privately held Vanuatu company operating under contract to the Vanuatu government as the Maritime Administrator. There are more than 600 ships on the Vanuatu register.

    Interactive Gaming

    Legislative Framework. In 1999, the Government of Vanuatu completed a research and analysis project into internet gaming. The Government then determined that internet gaming, if managed responsibly and appropriately, may be offered from within Vanuatu with significant advantage to operators, players and the people of Vanuatu represented by the Government.

    The Interactive Gaming Act 2000 provides the framework to regulate gaming and wagering activities on the internet and other communications media. In particular, the regulatory framework provides for the issue of a Vanuatu Interactive Gaming License under which casino style games, fixed odds wagering and pari-mutuel games can be conducted from within Vanuatu.

    In 2003, the Government of Vanuatu announced amendments to its Interactive Gaming legislation, to offer a more competitive licensing regime for online sports books and betting exchanges.

    Vanuatu comprehensive legislative framework provides for the following:

    • probity checking of license applicants, their close associates and significant suppliers - to ensure that the people conducting internet gaming from Vanuatu are fit to do so;
    • competency checking – to assure that licensees have the necessary skills and experience to successfully operate an internet gaming business;
    • financial checking of operators – to assure licensees have the financial resources necessary to be successful;
    • gaming system checking – to assure that the gaming systems are secure, fair, robust and well managed.

    Interactive Gaming Licensing. Interactive gaming operators in Vanuatu are considered financial institutions and require licensing. Only a company licensed under Companies Act (i.e. local company) may apply for the license to be issued under the Interactive Gaming Act.

    Interactive Gaming Consultants Ltd. (IDCL) has been appointed by the Government of Vanuatu to manage all issues in relation to interactive gaming licensing and regulation in Vanuatu. IGCL performs license application evaluations, consultation on regulatory guidelines and legislative amendments and licensee auditing on behalf of the Regulator.

    The Regulator is the Department of Customs and Inland Revenue which is a state agency to control interactive gaming.

    Procedure in Obtaining an Interactive Gaming License:

    • submit application to IGCL;
    • IGCL verifies application;
    • IGCL forwards application with recommendations to the Minister of Finance;
    • based on these recommendations, the Minister grants or rejects the application and advises the applicant accordingly.

    When considering the application for interactive gaming license the Minister must conduct the investigations including obtaining from a law enforcement agency a report on the applicant and/or any individual who is or will be involved in the business and may require any of the individuals to have his or her photograph, finger prints and palm prints taken.

    Before a license is granted the Regulator must approve:

    • the interactive game;
    • any software under which the game operates and, if possible, the source code for that game;
    • the rules of the game;
    • any material accompanying the game;
    • the way in which the game, and any accompanying material, presents to and interacts with the player;
    • control system.

    Fees and Taxation. Application and license fees are prescribed to be paid by a licensee to the Regulator as follows:

    Application fees:

    1. USD 75,000.00 for an application for a license to conduct all forms of interactive gaming; and
    2. USD 35,000.00 for an application for a license to conduct only sports book operations.

    License fees:

    1. USD 50,000.00 for the grant of a license to conduct all forms of interactive gaming and USD 50,000.00 for the annual renewal of such a license;
    2. USD 30,000.00 for the grant of a license to conduct only sports book operations and USD 30,000.00 for the annual renewal of such a license.

    Internet gambling sites that offer events wagering pay a once only application fee of USD 35,000, and an annual payment of USD 30,000. In addition, operators of fixed odds event wagering pay 0.1% turnover tax, while Interactive Gaming Tax Rate for all other operators is set at 2.5% of gross profit.

    Tax on sports book fixed odds wagering – 0.25% of gross turnover.

    The gross profit of a licensee’s operations (other than fixed odds wagering) is to be worked out using the following formula:

    Gross profit = Amount played (total amount received from those operations) - Amount of winnings (total amount paid out as prizes to players)

    A licensee is entitled to deduct from the interactive gaming tax for a particular month:

    • bandwidth charges paid by the licensee for that month in excess of USD 0.07 per megabyte; and
    • such bad debts as are declared by the licensee for that month that are due to credit card repudiation and/or dishonored cheques.

    The period of a license cannot exceed 15 years; then the license may be renewed.

    Audit. A licensee must keep gambling records at a place approved by the Regulator in Vanuatu; a gambling record must be kept for 5 years after the end of the transaction to which the record relates.

    A licensee must appoint a qualified auditor, and the auditor must do <b>annual auditing</b> and provide the Regulator with the annual report.

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