Globalization has made offshore company formation a lucrative option for businesses to prosper. Among the various jurisdictions worldwide, Seychelles tops the list as the ideal destination. It is an archipelago of 115 islands located in the Indian Ocean. Its proximity to African nations and its central location as a route to various countries boost its popularity. Setting up a special license company in Seychelles ensures access to business opportunities both within and outside the country's geographical boundaries. Let’s understand what a special license company is, its advantages, and how you can set one up.
What is a Special Licence Company (CSL)?
A Seychelles CSL is incorporated under the Companies Act of 1972 with a special license issued under the Special License Act of 2003. An International Business Company (IBC) is one of the most common structures for company setup. It is typically exempt from taxes in Seychelles on foreign-sourced income.
In contrast, a Seychelles Special License Company (CSL) is considered a tax resident of Seychelles and may be subject to local taxation. Moreover, The CSL is a hybrid structure—a domestic company with offshore privileges, including access to Seychelles’ Double Taxation Avoidance Agreements (DTAAs). A Seychelles CSL is authorized to conduct business in the following areas.
Offshore banking
Offshore insurance and reinsurance
Intellectual property holding
Franchise
Investment services
Holding company
In addition to that, you cannot perform offshore banking, offshore insurance, or reinsurance using Seychelles IBC or any other type of offshore company structure. However, you can perform them with a Seychelles Special License Company, which can have a separate banking license.
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Distinctions between the Seychelles Special License Company (CSL) and the Seychelles IBC
These are the differences between Seychelles CSL and IBC:
Differences
Seychelles Special License Company (CSL)
Seychelles IBC
Business activities
Perform banking, insurance, and asset management with a license
Can hold assets and real estate, and cannot perform activities such as banking, insurance, and fund management
Legal status
It is incorporated under the Special Licenses Act of 2003
It is established under the International Business Companies Act (IBC Act), 2016
Taxation
Has a low tax rate of 1.5% on global income
Exempt from all local taxes
Confidentiality
Less confidential
High Confidentiality
Essential Requirements to Start a Seychelles Special License Company
There are specific prerequisites for setting up a special license company in Seychelles. Here’s a quick overview:
The presence of at least two shareholders
The presence of at least two directors
One company secretary
A registered address
The minimum share capital of at least 10% of its authorized capital
How to Start a Seychelles Special License Company?
A business investor must follow these steps to incorporate a CSL in Seychelles.
Select a Certified Business Consultant
Navigating the legal framework of Seychelles can be cumbersome for new business owners. It is best to hire a business consultant to assist you with setting up a firm in the Seychelles and ensure complete compliance.
Compile All the Documents
For company incorporation in Seychelles, it is advisable to keep all the documents in one place and submit them when required. For a special license company in Seychelles, the following list of necessary documents is required:
Memorandum and Articles of Association duly signed and dated.
A certificate signed by the local legal practitioner asserting that the MoA & AoA comply with local laws.
Name and address of the shareholders
A written declaration containing:
Name and address of the directors
Name and address of the secretary
Address of the registered office of the company
Business plan
Obtain the License
The Financial Services Authority (FSA), earlier known as the Seychelles International Business Authority (SIBA), will verify the documents. Once the documents are verified, the Registrar of Companies will issue a Seychelles certificate of incorporation. Moreover, FSA will issue respective business licenses under section 9(1) of the Companies (Special Licences) Act, 2003.
Open a Corporate Bank Account
Once you set up your company, you can open an international bank account, which will help you carry out business transactions worldwide without the hassle of currency conversion.
A special license company in the Seychelles is permitted to have complete foreign ownership. That means there is no requirement for a local partner to start an offshore company in Seychelles.
Choose from a Wide Range of Activities
With a special license company, you can venture into a range of activities related to finance, fisheries, and tourism, which are generally prohibited for generic businesses.
Confidentiality
Seychelles is known for its robust privacy laws. It ensures the personal information of the directors and shareholders remains confidential.
Asset Protection
You can transfer the assets in the name of the special license company. Once transferred, they cannot be subject to unwarranted claims.
Access to Double Taxation Treaties
Seychelles enjoys double taxation treaties with various countries. This, in turn, reduces the tax burden on the business owner, thus ensuring profitable business operations.
How Can We Help?
The incorporation of a company involves multiple steps that must be aligned accordingly. It is wise to proceed with certified business experts as they complete the proceedings in an error-free manner. Well, to get better clarity on the benefits that you can avail of, read our latest blog on Reasons to Hire an Offshore Business Consultant.
Since its inception, Business Setup Worldwide has helped numerous business clients establish their firms in multiple offshore jurisdictions. With a team of experts, we look forward to providing simple business incorporation solutions in a hassle-free manner. If you are looking forward to starting your Seychelles Special License Company, feel free to have a word with our business experts. Contact us today - we’d be happy to assist.
Mark Gracin is an adept professional with eight years of expertise in
writing and researching offshore company formation and banking
services. Through his blogs, he shares in-depth insights, helping
businesses and individuals make informed decisions in the realm of
offshore corporate structures and banking services.
Frequently Asked Questions
1. What is a special license company?
A special license company in Seychelles can conduct business in certain activities such as banking and insurance, which are generally prohibited for other companies.
2. Why should I opt for Seychelles?
The Seychelles is renowned as a tax haven and levies a nominal 1.5% tax on companies holding a special license.
3. What are the benefits of a special license company?
A low tax rate, minimal capital requirement, and the ability to choose from a wide range of business activities are some of the benefits of a special license company.
4. Who can own and manage a CSL?
Individuals, corporations, and other legal entities from any country can own and manage a CSL.
