Looking to set up Company in Dominica and Bank in Latvia

[alexcarter]

Hello Everybody!

I am new to the forum .. sorry if this has been asked several times
I run an online business (legal) with about £30K / month turn over , and now the legislation in my country UK has changed and all traders have to declare their information which i am not happy about doing.. so i thought of forming an offshore company and banking which will give complete anonymity .. I did a bit of research online and found offshore-companies.co.uk , and they advised me about setting up a Dominica company with Latvia bank account with Blue Orange. They want to charge me $2240 for the whole process , including setting up company with nominee director and processing bank application etc. The fee includes the following services:

Formation of IBC in Dominica, according to Second Package, which includes:
First year government filing fees; Certificate of Incorporation; Memorandum and
articles of Association; Letter of appointment of first director; Nominee Director;
Power of Attorney; Declaration of Trust from the nominee shareholder (if
a nominee shareholder is required); Minutes of the first meeting; Share
Certificates; Register of shareholders; Register of directors; Registered agent
services, (first year); Registered office, (first year); Apostille set of the
incorporation documents; International express delivery (with the tracking
number) by FedEx or DHL. And Bank Introduction to Latvia Bank.

My questions are :

1) Is Dominica/Blue Orange a good and safe combo to go for ? has anyone got any bad experience or stories ?
2) Is the fee quoted by the company a going rate for the service they provide ?
3) Is Blue Orange a trust worthy bank ? I have no intention to leave any funds in the bank but i would use to receive payments and use the funds to purchase the goods..
4) what are the pros and cons of Dominica jurisdiction ?
5) I read it in a forum that Dominca companies are badly rated by banks and it is hard to get bank account ? any comments please ?

Sorry for so many questions.. the more i read about offshore companies online.. the more confused and stressed i am .. i see guys here have good knowledge about these matters here.. and i would be much grateful if you can give me any suggestions and advice on this topic

Thanks in Advance

 

[mnschwarz]

First just be aware that an offshore IBC alone does not legally seperate you or help you avoid taxes due to CFC laws. That being said, if anonymity and hiding is your goal, nominees will help but they are not a total solution. It is getting incredibly hard to hide assets offshore these days. One of the first hurdles you'll face banking in Latvia is that they have signed on for the AEOI. A nominee bank signatory may avoid this issue depending on your setup.

I haven't seen much about Dominica or Blue Orange on the forums so info might be scarce. What was your reason for choosing this combo over other jurisdictions?

I believe Dominica is an acceptable jurisdiction for your needs though one of the slightly less common ones (which can also be good). If you don't plan to keep any funds in the bank account, safety of your funds should be fine. Just check other standards such as fees, limits, usability, online platform and so forth to make sure you're happy with them. That being said, if your funds are not in the account, where will they be? Wherever they are just be sure that account (and any others you need) also accepts Dominican corporations.

As for the fees, they sound pretty standard. There may be additional fees for the use of nominees. There will also be yearly fees for acting as registered agent & nominees (first year usually included in the incorporation fees). Further fees if you ask them to act as bank account signatory nominee. In addition, you'll usually pay fees when you request something from your nominees such as signing a contract, doing up minutes or resolutions, banking transactions etc.

 

[alexcarter]

First just be aware that an offshore IBC alone does not legally seperate you or help you avoid taxes due to CFC laws. That being said, if anonymity and hiding is your goal, nominees will help but they are not a total solution. It is getting incredibly hard to hide assets offshore these days. One of the first hurdles you'll face banking in Latvia is that they have signed on for the AEOI. A nominee bank signatory may avoid this issue depending on your setup.

I haven't seen much about Dominica or Blue Orange on the forums so info might be scarce. What was your reason for choosing this combo over other jurisdictions?

I believe Dominica is an acceptable jurisdiction for your needs though one of the slightly less common ones (which can also be good). If you don't plan to keep any funds in the bank account, safety of your funds should be fine. Just check other standards such as fees, limits, usability, online platform and so forth to make sure you're happy with them. That being said, if your funds are not in the account, where will they be? Wherever they are just be sure that account (and any others you need) also accepts Dominican corporations.

As for the fees, they sound pretty standard. There may be additional fees for the use of nominees. There will also be yearly fees for acting as registered agent & nominees (first year usually included in the incorporation fees). Further fees if you ask them to act as bank account signatory nominee. In addition, you'll usually pay fees when you request something from your nominees such as signing a contract, doing up minutes or resolutions, banking transactions etc.

Thank you so much for your reply! much appreciated

Sorry .. I do not understand what you mean by "One of the first hurdles you'll face banking in Latvia is that they have signed on for the AEOI. A nominee bank signatory may avoid this issue depending on your setup."

I think the set up is that once the company is formed , i will open the bank account with my documents under my name with me being the signatory ? is there any problem if i did it this way ?

I did not have any specific reason to chose this combo , i was contacting several agencies and this particular one were quite professional and answered all my questions quite well and they suggested this combination to me. I do not need to stick with this combination, i am always open to suggestions as long as they work

Regarding your question about where my funds will be.. is that , i can easily divert the funds coming from my sales into different accounts .. so my plan was to divert say 80% the funds into the offshore accounts which i can use to buy more stock and the rest of the payment i will divert into another bank account as my savings .. so in theory i wont have much cash lying about in the offshore bank at one point .. once the money is in the account .. i will use it to buy more stock using the debit card or use that money to pay off my personal credit cards which i use to buy stock for my business. i hope it makes sense..

Is there any other combo you suggest ? any suggestion/advice will be much appreciated

 

[mnschwarz]

Thank you so much for your reply! much appreciated

Sorry .. I do not understand what you mean by "One of the first hurdles you'll face banking in Latvia is that they have signed on for the AEOI. A nominee bank signatory may avoid this issue depending on your setup."

I think the set up is that once the company is formed , i will open the bank account with my documents under my name with me being the signatory ? is there any problem if i did it this way ?

I did not have any specific reason to chose this combo , i was contacting several agencies and this particular one were quite professional and answered all my questions quite well and they suggested this combination to me. I do not need to stick with this combination, i am always open to suggestions as long as they work

Regarding your question about where my funds will be.. is that , i can easily divert the funds coming from my sales into different accounts .. so my plan was to divert say 80% the funds into the offshore accounts which i can use to buy more stock and the rest of the payment i will divert into another bank account as my savings .. so in theory i wont have much cash lying about in the offshore bank at one point .. once the money is in the account .. i will use it to buy more stock using the debit card or use that money to pay off my personal credit cards which i use to buy stock for my business. i hope it makes sense..

Is there any other combo you suggest ? any suggestion/advice will be much appreciated

The issue with banking in Latvia is the AEOI - Automatic exchange of information. Latvia is one of the jurisdictions that have signed on (and one of the first ones). This means that you when you open the bank account, they will ask who the beneficial owner is, which is you. They will then automatically report everything back to UK (I believe that was your residency). This means that there will be no privacy. And as also mentioned, under CFC laws you are liable to pay tax on the offshore company's earnings.

Also, without knowing exactly how you are diverting sales and which accounts etc, keep in mind that what you are trying to do by avoiding taxes is illegal and your goal, as you stated, is privacy / anonymity to achieve this. I say this because the last thing you want to do is create a connection between your offshore entity and your self (without good reason & evidence to withstand an investigation at least). Transferring funds from company sales in to your personal account is a surefire way to attract attention. Most that take the anonymous route keep their business activities completely separate.

As for other suggestions, the AEOI and privacy issues are relatively widespread. Seychelles & Belize are two very common offshore jurisdictions at the moment. But if you create a connection to yourself from those entities, the result is the same. Likewise, the AEOI relates to where you bank (and how each individual bank applies the CRS) and where you are resident. A Belize or Seychelles company banking in Latvia will face the same issue. Banking in a non-AEOI jurisdiction will avoid the issue. That being said, there isn't many decent jurisdictions that haven't signed on and I'm sure more will continue to do so going forward. Another option is to use a nominee bank signatory. You are then never known to the bank. This presents other issues though such as extra costs and of course a large degree of trust in your nominee. You can also take the drastic approach of moving and becoming resident in a tax haven or non-AEOI jurisdiction. Or a more complex structure such as having a Foundation or Trust own the offshore company. In Seychelles the law states the beneficial owner of a foundation is the foundation itself. So this is also a legal way to not become the UBO. Not all banks like this setup though and may not accept the IBC as a client. Some banks also report account holders even if they aren't the UBO so you would need to check individual bank reporting policies. Also while it is a legal separation from the assets, if the structure is discovered an investigation under CFC laws may initially be done in UK and they may make their own different ruling. For this reason privacy is still an important step to take.

 

[jryan54]

From my experience banking in Latvia was relatively painful for me and my situation. I used Rietumu Bank around the mid 2000's and they were a complete pain in the a*s with plenty of hidden fees. IMHO there are some easier jurisdictions to bank in.