Company Registration in the Bahama Islands - Business Starting & Setup

The legal system in the Bahamas is based upon the English common law.

The offshore companies or IBCs are regulated by the International Business Corporations Act 2000.

The principal forms of business organization in the Bahamas are:

• international business company;
• domestic limited company;
• company limited by guarantee;
• unlimited company;
• foreign company;
• segregated account company;
• joint venture,
• general partnership;
• limited liability partnership;
• exempted limited partnership;
• undisclosed partnership;
• sole proprietorship;
• trusts;
• foundations

For offshore solutions, the most common structure is the IBC.

There is a range of requirements to the company name in the Bahamas:

• The word “Limited”, “Limited Liability Company”, “Corporation”, “Incorporated”, “Gesellschaft mit beschrankter Haftung”, “Societe Anonyme” or “Sociedad Anonima” or its respective abbreviation “Ltd.”, “LLC”, “Corp.”, “Inc.”, “GmbH”, or “S. A.” shall be at the end of the name of every company with limited liability.
• A name should not be identical with that under which a company in existence is already incorporated under or so nearly resemble the name of another company as to be calculated to deceive, except where the company in existence gives its consent.
• A name should not contain, without express prior permission of the Registrar which permission may be withheld without assigning a reason, the words “Assurance”, “Bank”, “Building Society”, “Chamber of Commerce”, “Chartered”, “Cooperative”, “Imperial”, “Insurance”, “Municipal”, “Royal”, “Trust”, or a word conveying a similar meaning, or any other word that, in the opinion of the Registrar, suggests or is calculated to suggest the patronage of or any connection with Her Majesty or any member of the Royal Family or the Government of The Bahamas, a department thereof, a statutory corporation or board or a local or municipal authority.
• A company name should not be indecent, offensive or, in the opinion of the Registrar otherwise objectionable.

In case of the violation of the above, the Registrar may, whether or not the consent of the company in existence give notice to the last registered company to change its name and if it fails to do so within 60 days from the date of the notice the Registrar shall direct the company to change its name to such name as the Registrar deems appropriate, and the Registrar shall publish a notice of the change in the Gazette.

The following steps are required to incorporate an IBC in the Bahamas:

1. Search for a company name and reserve the proposed name: it is mainly done online or by lawyers and service providers who include the name fees in their fees. The name reservation expires after 90 days.
2. The registered agent prepares and notarizes the company documents: the required documents include - Letter of Compliance pursuant to section 15 (4) of the IBC Act; Memorandum and Articles of Association.
3. Pay the incorporation fee
4. File the company documents at the Companies Registry: The registration is usually done by the lawyer. The company is incorporated on the date that the incorporation documents are submitted to the Companies Registry.

It takes 1 to 7 business days to register an IBC.

The following restrictions apply on IBCs’ activities:

• no business may be transacted with residents in the Bahamas;
• no ownership interest in real property in the Bahamas is permitted; property may be leased for office use only;
• banking, insurance or re-insurance business is not permitted;
• engaging in the business of company management or providing registered facilities for Bahamian incorporated companies is not permitted.

However, IBCs are permitted to own shares in other Bahamian companies, maintain bank accounts in the jurisdiction and employ the services of local professionals.

A company shall at all times have a registered office in The Bahamas.

The address of the registered office shall be submitted to the Registrar with the Memorandum for registration upon the date of the application for incorporation.

The directors of the company may change the address of the registered office of the company, which change shall be notified to the Registrar within 14 days after such change has been made.

The following information should be kept at the registered office:

• a copy of the Memorandum and Articles and all amendments thereto;
• a register of all its directors and officers

A company shall at all times have a registered agent in The Bahamas.

No person shall act as registered agent unless he is licensed to carry on the business of financial and corporate services pursuant to section 3 of the Financial and Corporate Service Providers Act:

The name and address of the registered agent shall be submitted to the Registrar for registration at the date of incorporation of the company.

The company shall notify the Registrar of any change in the name or address of the registered agent.

Where the registered agent of a company desires to cease to act as registered agent and the registered agent is unable to reach an agreement with the company for which he is registered agent concerning his replacement, the following provisions shall apply —

• the registered agent shall give not less than 90 days written notice to any director or officer of the company of which he is the registered agent at the director’s or officer’s last known address, or if the registered agent is not aware of the identity of any director or officer then the person from whom the registered agent last received instructions concerning the company, specifying the wish of the registered agent to resign as registered agent;
• the registered agent shall give not less than 90 days written notice to any director or officer of the company of which he is the registered agent at the director’s or officer’s last known address, or if the registered agent is not aware of the identity of any director or officer then the person from whom the registered agent last received instructions concerning the company, specifying the wish of the registered agent to resign as registered agent;
• if, at the time of the expiry of the notice, the company has not notified the Registrar or the registered agent of any change in the name or address of its registered agent, the registered agent shall inform the Registrar in writing that the company has not changed its registered agent whereupon the Registrar shall publish a notice in the Gazette that the name of the company will be struck off the Register, unless the company, within thirty days from the date of the publication of the notice in the Gazette, notifies the Registrar of the change in the name or address of its registered agent; and
• if a company fails within thirty days from the date of the publication of the notice to notify the Registrar of the change in the name or address of its registered agent, the Registrar shall strike the name of the company off the Register and shall publish in the Gazette a notice that the name of the company has been struck off the Register.

A company shall have a common seal and an imprint thereof shall be kept at the registered office of the company.

The redomiciliation of companies to or from the Bahamas is permitted.

A company incorporated under the laws of a jurisdiction outside The Bahamas may continue as a company incorporated under IBC Act as follows —

• articles of continuation, written in the English language or if written in a language other than the English language, accompanied by a certified translation into the English language, shall be approved by a majority of the directors or the other persons who are charged with exercising the powers of the company;
• the articles of continuation shall contain — (i) the name of the company and the name under which it is being continued; (ii) the jurisdiction under which it is incorporated; (iii) the date on which it was incorporated; (iv) the information required to be included in a Memorandum under section 13(1); and (v) the amendments to its Memorandum and Articles, or their equivalent, that are to be effective upon the registration of the articles of continuation;
• the articles of continuation, accompanied by a copy of the Memorandum and Articles of the company, or their equivalent, written in the English language or if written in a language other than the English language, accompanied by a certified translation into the English language and in the case of a foreign company, evidence satisfactory to the Registrar that the company is in good standing, shall be submitted to the Registrar who shall retain and register them in the register; and
• upon the registration of the articles of continuation, the Registrar shall issue a certificate of continuation under his hand and seal certifying that the company is incorporated under this Act.

Subject to any limitations in its Memorandum or Articles <u>a company incorporated under IBC Act may, by a resolution of directors or by a resolution of members, continue as a company incorporated under the laws of a jurisdiction outside The Bahamas</u> in the manner provided under those laws.

A company incorporated under IBC Act that continues as a company incorporated under the laws of a jurisdiction outside The Bahamas, does not cease to be a company incorporated under IBC Act unless the laws of the jurisdiction outside The Bahamas permit the continuation and the company has complied with those laws.

An IBC shall be managed by at least one director who may be an individual or a company. Directors need not be resident in the Bahamas and there is no stipulation as to their nationality.

A company shall keep a register to be known as a register of directors and officers containing —

• the names and addresses of the persons who are directors and officers of the company;
• the date on which each person whose name is entered in the register was appointed as a director or officer of the company; and
• the date on which each person as a director or officer ceased to be a director or officer of the company.

The register of directors and officers may be in such form as the directors approve, but if it is in magnetic, electronic or other data storage form, the company must be able to produce legible evidence of its contents.

The register of directors and officers, commencing from the date of the registration of the company, shall be kept at the registered office of the company.

A copy of the register of directors and officers shall be filed with the Registrar and shall be open to inspection by members of the public during official hours. The register of a company shall be filed with the Registrar within twelve months after the appointment of the directors and officers of that company. Where the register has not been filed within this period the company may be struck off the Register.

Directors meetings need not be held in the Bahamas and can be held by telephone.

There is no statutory requirement for a secretary in the Bahamas.

The minimum requirement for a Bahamian IBC is one shareholder. Shareholders may be either a natural person or a corporate entity. Shareholders may be of any nationality and reside in any country. Nominee Shareholders are allowed.

A Bahamian IBC does not need to hold an Annual General Meeting of its shareholders. Shareholders and directors meetings need not be held in the Bahamas and can be held by telephone.

Shareholders’ details are not available to public.

Until 2001, there was no need to register details of beneficial owners, directors or officers, but under the International Businesses Companies Act 2001 which came into force at the start of 2001 IBCs are required to submit their identities, addresses and names of directors and owners to the Registrar General's Department. However, beneficiary's detailes are disclosed only to registered agent.

There is no minimum capital requirement.

Shares must be registered and may be issued in any currency.

Bearer shares are no longer permitted.

Shares can be issued at a par or a non-par value.

Standard amount of capital is 50000 US dollars.