Parliament of the Commonwealth of Dominica repealed INTERNATIONAL BUSINESS COMPANIES ACT of 1996

[mklstmsfrg]

Hi all.

I would like to ask for your help regarding the following issue.

I had found an IBC in Commonwealth of Dominica many years ago. (more as 10years ago)

On July 5th, 2021 the Parliament of the Commonwealth of Dominica repealed INTERNATIONAL BUSINESS COMPANIES ACT of 1996 with effect from January 1st, 2022.

I got this information only in December 2021, from my agency, who founded the IBC in 201x.

My problem is the following:

The IBC was part of the ownership structure of a limited liability company, that residing in an European country, in order to certify for the authorities the closing of the IBC in this European country, I would need a proof respectively a confirmation document, that the IBC was terminated without a successor.

I contacted the Government authorities in Commonwealth of Dominica, 1 month ago, I got no answer until now.

I contacted the business registry in the country (Commonwealth of Dominica), now answer yet

I contacted the local IBC creator agency, they said, I must wait few weeks (?), this is also more as 2 weeks ago now.

Is there anything that I can do now? Has somebody any idea? Is this not against international law,

I mean that the authorities of Commonwealth of Dominica doesn’t confirm the winding up of the IBC in any form?

Thank you for your answer/ support in advance.

 

[Sols]

Haven't looked into this particular situation but when other jurisdictions have terminated their IBC legislations, there has been a long enough grace period to dissolve IBCs. It's not like all IBCs were dissolved over night. Your registered agent is probably overwhelmed and will take weeks/months to dissolve. Two weeks is not a very long period of time when something as big as this happens.

Don't expect much help from the Dominican government, unfortunately.

If you don't have a nominee shareholder and nominee director of the IBC, you could pass a resolution to transfer the shares the IBCs holds in the EU subsidiary to another entity that you own. Look into any legal and tax implications of this first, though.

 

[uplana]

It means game over for Dominica and their IBC's - wonder what options they have left in these countries where they have terminated their IBC legislation as @Sols say?

 

[Sols]

Some have implemented tax-neutral LLCs and/or territorial taxation. Some have abandoned being tax havens.

 

[mklstmsfrg]

thank you for your answers.
Here is the law, gazetett on 7th of July 2021, i got the information from my founder european agency on 20th of december 2021

https://www.dominica.gov.dm/laws/20...s_companies_ibc_repeal_act_2021_6_of_2021.pdf
@Sols
>>>If you don't have a nominee shareholder and nominee director of the IBC, you could pass a >>>resolution to transfer the shares the IBCs holds in the EU subsidiary to another entity that you own.

I have a nominee shareholder unfortunately

But i have a resignation letter from him without a date as this common, i can date this and let he resign without a compensation.

Is there any possibility to go this way and use this paper?

I asked 5 lawyer-firms in this EU-country, where i reside, 4 said they doesn't can help me.

1 answered detailed, but they said the following:

-you will need:
1. Confirmation from the Dominican court of registration (or registration authority) that the IBC has been wound up
and removed from the register (the legislation you have sent is not suitable for this->see the link what i sent above)
2. Proof that you are the legal successor of the IBC.

Documents must be authenticated by Apostille.
#

in online business registry if check for the name, the IBC is still active and not deleted.

Thank you in advance for any contribution!!

 

[Sols]

I have a nominee shareholder unfortunately

Are you the director, or do you have a nominee director as well?

But i have a resignation letter from him without a date as this common, i can date this and let he resign without a compensation.

Is there any possibility to go this way and use this paper?

Study that agreement and make sure it means that you become the new shareholder. If so, you might be able to take control of the IBC and transfer ownership of the subsidiary to another company. But it might not technically come into effect until the company secretary stamps it. Your agent in Dominica might be able to help with that and speed up the transfer process.

I asked 5 lawyer-firms in this EU-country, where i reside, 4 said they doesn't can help me.

1 answered detailed, but they said the following:

-you will need:
1. Confirmation from the Dominican court of registration (or registration authority) that the IBC has been wound up
and removed from the register (the legislation you have sent is not suitable for this->see the link what i sent above)
2. Proof that you are the legal successor of the IBC.

Documents must be authenticated by Apostille.
#

in online business registry if check for the name, the IBC is still active and not deleted.

Thank you in advance for any contribution!!

That answer only applies if the IBC has been dissolved/wound up. You don't know if that has happened, it probably hasn't. Incorporation of new ones has stopped and old ones are supposed to stop trading.

https://www.fsu.gov.dm/images/documents/Notice_of_Closure_of_the_IBC_sector.pdf
There is a contact email address there.

 

[Martin Everson]

But this is not something new. Dominica was not making any money from the IBC act for years and then with EU pressure it was forced to end its regime as part of removal from EU blacklist . People where given 6 months notice.

https://news.gov.dm/news/5286-parliament-repeals-international-business-companies-act
I would wait for the IBC agency to come back to you. Two weeks is not long enough for an agent who may have 100's if not 1000's of companies. But take no action now. If they do not come back to you in a couple of weeks then speak to a lawyer in Dominica and provide them details of IBC agency and the issue. The repeal allows for the IBC to convert to a normal company under Company Act rather than IBC Act at no cost (yes 25% corporate tax rate you will face and Economic Substance issues). This maybe an intermediate step you can take to again have an active company and then later transfer shares to a new structure. But speak with lawyer over there.

 

[mklstmsfrg]

Thank you for all for the useful !
#
I don't want to share the company name, but company is still there, in the online registry as active,
so not deleted from there:

https://efiling.cipo.gov.dm/#/
so here is the extract from the information:

XXX Ltd. (XXX)
COMPANIES & INTELLECTUAL PROPERTY OFFICE
Status: non-CARICOM
Registration Date: Mar xx, 201x
Type: IBC Company
Address: 8 Copthall, Roseau Valley, Commonwealth of Dominica

So this is not deleted yet.

@Sols

>>>That answer only applies if the IBC has been dissolved/wound up. You don't know if that has >>>happened, it probably hasn't. Incorporation of new ones has stopped and old ones are supposed to >>>stop trading.

There is one thing yet, this is me not allowed, or was not allowed yet to contact the dominican ageny directly, because the foundation of the IBC happened over the european agent/intermediary in my home country, and i also wanted to pay the extension fees directly to dominican agency formerly, but they didnt accept that, beacuse the foundation of the IBC was over the european agent/intermediary in 201x.

@Sols
>>>https://www.fsu.gov.dm/images/documents/Notice_of_Closure_of_the_IBC_sector.pdf

>>>There is a contact email address there.

Thank you very much, i will contact them also,

@Sols
>>>Are you the director, or do you have a nominee director as well?

I have a nominee director

 

[mklstmsfrg]

i wrote for the goverment,
for the local agancy
for the agency in the europen country
for the online business registry in dominica
for the financial service unit -> [email protected]
for [email protected]
without any usable all any respond at all, i will report here later on.

 

[Spinat]

I had found an IBC in Commonwealth of Dominica many years ago. (more as 10years ago)

that's a game over for Dominica and the rest of the offshore havens. 80% of people registering a companies in tax haven are very small fishes, they can't pay what it cost to get a company registered and managed.

 

[mklstmsfrg]

>>>The repeal allows for the IBC to convert to a normal company under Company Act rather than IBC Act at no cost (yes 25% corporate tax rate >>>you will face and Economic Substance issues). This maybe an intermediate step you can take to again have an active company and then >>>later transfer shares to a new structure. But speak with lawyer over there.

Thank you for your advise.

One very important question yet, beacuse nobody answer:
-goverment
-fsu -financial service unit
- local agancy in dominica
- agency in the europen country
-online business registry in dominica
-[email protected]

i have only the chance to ask you.

Could the force me to convert the IBC to a normal company under Company Act rather than IBC Act ?

i have read all acts, that was linked in this forum, and if I unterstood correctly the conversion the an normal company,
was only possible, if you announce that until that until 31th of december 2021.

If I dont unsterstood that correctly, please correct me.

The worst possibility that a say, that the IBC will in the structure in the european LLC, until end of the life of the european LLC, what i don't want to dissolve in the next 7 years or more. Do you see here any risks? The european LLC also dont take any business since september 2021, but there assets in the company yet.

 

[mklstmsfrg]

i want to adress my former question to @Martin Everson Thank you!!

 

[Sols]

Contact Dentons or Stowe & Co. IIRC, those are the main law firms in Dominica for financial and corporate services.

i want to adress my former question to @Martin Everson Thank you!!

There is a +Quote button with each post that makes quoting easier and alerts the user you're quoting (unless they've disabled that setting).

 

[mklstmsfrg]

@Sols thank you for your advice regarding the law firm,
and also regarding quoting button, i pressed it now, but at me seems doesn't function, i have free membeship

 

[Sols]

You first click +Quote and then a yellow button labelled Insert Quote appears below where you input text, next to Attach files.

 

[mklstmsfrg]

You first click +Quote and then a yellow button labelled Insert Quote appears below where you input text, next to Attach files.

OK I see

 

[Martin Everson]

Could the force me to convert the IBC to a normal company under Company Act rather than IBC Act ?

No.

i have read all acts, that was linked in this forum, and if I unterstood correctly the conversion the an normal company,
was only possible, if you announce that until that until 31th of december 2021.

The text of the deadline given may be more related to not having to pay for the conversion and getting it done for free rather than a deadline for the actual conversion itself. It's open for interpretation. In any case decide what you actually want to do going forward and then contact agent and also a lawyer as mentioned. As you pointed out the company is not struck off yet.

The worst possibility that a say, that the IBC will in the structure in the european LLC, until end of the life of the european LLC, what i don't want to dissolve in the next 7 years or more. Do you see here any risks? The european LLC also dont take any business since september 2021, but there assets in the company yet.

Find out if company is still legally active as legislation implies it shouldn't be but registry says different. Then just move ownership of European LLC's away from it if thats what you want to do. But you need to hear back from agent at least or get a lawyer to communicate with agent so you can see what can be done.

 

[mklstmsfrg]

shouldn't be but registry says different

Thank you very much for the answer, yes this is the point, i check it every day, but still active,
XXX Ltd. (XXX)
COMPANIES & INTELLECTUAL PROPERTY OFFICE
Status: non-CARICOM
Registration Date: Mar XX, 201Y
Type: IBC Company
Address: 8 Copthall, Roseau Valley, Commonwealth of Dominica

There are about 7 weeks yet, until the company would be normally active (end of march) , probably in this weeks they do something.

Then just move ownership of European LLC's away from it if thats what you want to do

This is exactly what i want to do, but i wait until i get an official paper, everbody (lawyers, business registry court in euopean country) say i can't do anything.without official paper.

 

[mklstmsfrg]

Contact Dentons or Stowe & Co. IIRC, those are the main law firms in Dominica for financial and corporate services.

i contacted Dentons, Stove&Co will follow

 

[mklstmsfrg]

1 answer from, FSU, that i also can use, they attached the repeal act. what i already had, and said that i can convert the ibc to a normal company, what i dont want to do, all other 7-8 parties doesnt answer.