Offshore International Business Corporation (IBC) in the Marshall Islands

The Marshall Islands is a jurisdiction for offshore business with an ambiguous reputation, and it is not the choice that fits absolutely all business purposes. However, there are situations when registration of an offshore IBC in the Marshall Islands will be very profitable and promising. 

Some commercial projects that our customers want to launch allow for alternative solutions, so we analyze all the pros and cons of offshore registration in the Marshall Islands to give them the best (not just the possible!) solution.

Let’s look to see whether this offshore jurisdiction is suitable for your business. 

Don’t choose the Marshall Islands if you intend to open a bank or trust or are involved in insurance or reinsurance. In all these cases, an offshore IBC will not demonstrate its full capacity or its registration will be impossible. In addition, if you are engaged in gambling as a business activity, it automatically excludes the Marshall Islands from the list of possible jurisdictions.

Besides, consider the dependence of this Micronesian associated state on the USA, the world’s main fighter for the offshore secret to be revealed. And though the country does not disclose the data on owners recorded in the Marshall Islands register of companies, an offshore company dependent on the United States is still not suitable for everyone. Consequently, if confidentiality and anonymity are among your main objectives, this jurisdiction should not be considered a priority option.

A Business Company in the Marshall Islands is an Optimal Choice, But Not for Everyone

The Marshall Islands will be best suited to register a company that would later own seagoing yachts and ships registered there. The ship register of this tiny and sparsely populated state is one of the largest ones globally (with more than 1,600 merchant ships from all over the world!). In this sense, it is a well-known and respected jurisdiction with an excellent system of services.

We consider it a logical decision to register an offshore IBC in the Marshall Islands if you are planning to successfully complete the IPO procedure and bring your company to the world’s most prestigious exchanges (for example, the ones in New York, London, and Singapore).

This implies a thorough company audit, and the peculiarities of this island jurisdiction fully meet the strict requirements of this procedure. To date, about 40 offshore companies registered in the Marshall Islands have successfully passed the IPO procedure and are publicly traded. What if yours will be the next one?

In any case, if you are developing a startup (an IBC in our case) with several rounds of investments, your decision to register a company in the Marshall Islands may be an additional advantage in the eyes of potential investors since it creates more opportunities to exit the project with multiplied investments. 

Such a decision allows you to create a company and take it public. This will definitely raise your score when your project is assessed by an experienced venture capitalist as he becomes aware of the overall exit strategy from these investments. This is especially true if there is a well-developed financial plan for this, covering the whole way up to the IPO stage. In this case, an IBC in the Marshall Islands will be an extremely profitable option that is worth analyzing on a priority basis.

In addition, an offshore company in the Marshall Islands is ideal for international trade in physical goods and providing various services. There are also great opportunities for companies registered in the Marshall Islands that operate entirely through the Internet.

Registration of an Offshore Company in the Marshall Islands is the Right Choice for Serious Business!

The laws governing the registration (incorporation) and actual business conducted by offshore IBCs/LLCs/LPs (limited partnerships) are largely similar to those in the American state of Delaware. It is often (and not without reason!) called the main offshore of the United States as the process of doing business and registration is easy and there are good prospects for further development.

This article focuses on the registration of an offshore IBC and all related aspects only, but you can contact our experts and ask any additional questions connected with business operations at an individual session. IBC registration in the Marshall Islands is a great solution if you need to make sure that you can easily sell a part of your offshore company in the future.

The most important aspects:

• At least two positions are required in the management structure of an offshore IBC in the Marshall Islands – a director and a secretary.
• The functions of the corporation’s director and secretary may be performed by both natural and legal persons.
• The Marshall Islands formally allow using nominee service. So, if you do not want to be in the public eye, you can hire a nominee director and a secretary (this option is not included in the standard package of services).
• The positions of director and secretary can be combined (with the actual status of a beneficial owner as well) to optimize the budget of the offshore IBC.

We would like to draw your attention to the fact that the Marshall Islands have been excluded from the blacklist of the European Union offshores since October 2019. The jurisdiction implements all the information exchange requirements set by the European Union. Thanks to this, the reputation of the country and offshore IBCs has significantly improved and immediately attracted the attention of new entrepreneurs.

Name and Share Capital of an Offshore IBC

There are no special requirements or unrealistic conditions imposed by corporate law. The name of the offshore company can be registered in any language – the main condition is the use of the Latin alphabet. We recommend preparing several alternative names to avoid any problems during IBC registration in the Marshall Islands.

Other aspects to be considered:

• The name of the offshore IBC in the Marshall Islands can (optionally) contain absolutely any standard corporate suffixes, such as Limited, Ltd., A.G., Corporation, Corp, S.A., Incorporated, Inc., etc.
• It is prohibited to use the following words in the name: Bank, Insurance, Assurance, Re-Insurance, Trust, Foundation, Charity.

Once you have selected a name for your IBC, we will check it with the register. If everything is OK, we can proceed to the next phase of business registration in the Marshall Islands which involves the calculation of the share capital structure.

Here are more details on the share capital:

• The IBC’s share capital in the Marshall Islands can be of any size.
• You can nominate the share capital in any currency.
• If the number of shares without par value exceeds 500 or the amount of share capital exceeds USD 50,000, a small one-time tax will be levied when IBC is registered.
• The typical share capital of an offshore company in the Marshall Islands does not exceed USD 50,000 (see above).
• At the stage of IBC incorporation, you can just pay a symbolic share of capital equaling USD 1.

Document Package

It is standard for almost any offshore jurisdiction, not just the Marshall Islands.

Here are the documents required to register a company:

• notarized copies of the passports of IBC/partnership founders
• proof of actual residence (e.g. copies of paid utility bills). This document should not be older than 2 months, and translation into English is mandatory.
• If the positions of director/shareholder are entrusted to legal entities, additional registration documents will be required (you can request a standard or a full list from our experts).

Other aspects to be considered:

• The information on beneficial owners should be provided at the first request of the registration agent/on the basis of a formal government request.
• Annual certification is mandatory for new and registered IBCs in the Marshall Islands. The lists of directors, beneficial owners, managers, as well as other persons associated with the company’s offshore business are subject to checks. If violations are found, a fine will be imposed on the company (up to USD 50,000), and the company will be forcibly liquidated in extreme cases (even if it was registered without claims from the regulator).
• The struggle against money laundering and aggressive tax optimization schemes (OECD/FATF requirements) has now become a feature of “correct” offshore jurisdiction. The classic tax-free jurisdictions of the 1980s – 2010s are virtually gone.
• The use of bearer shares in the Marshall Islands is becoming increasingly transparent (a register of owners is maintained).

The Cost of Incorporating an Offshore IBC in the Marshall Islands, Additional Costs

The amount indicated at the very top of this page (3285 USD) is a basic one, while the actual cost of services can be both lower and higher in your case. It all depends on your requirements for an offshore IBC in the Marshall Islands, the possibility to register a legal entity for a specific business area, your residency/tax status, the volume of selected additional services, and the need to use a nominee service. If your budget is limited, ask our experts to prepare the most affordable offer for you to suit specific needs.

The basic package of services (3285 USD paid at the stage of service contract conclusion, which allows you to register an offshore company avoiding significant additional costs) includes:

• registration of an offshore IBC in the Marshall Islands
• all applicable state duties
• registered agent’s services
• registered office (legal address)
• a set of original corporate documents
• courier delivery around the world

Services related to the annual extension of the offshore IBC in the Marshall Islands (USD 2,259 in total; you can register the company and pay for 1 year or more):

• state renewal fee
• registered agent in the Marshall Islands
• registered office (legal address)

The documents handed over to you after we register an IBC in the Marshall Islands (free of charge, included in the service cost):

• Certificate of Incorporation
• Endorsement Certificate
• Power of Attorney
• Articles of Incorporation
• the consent of the Registrar to the appointment of a director
• accepted standard Articles of Association (optional)
• service fee (for the first year)

Free advice on selecting a bank account:

• Foreign/offshore personal account.
• Foreign payment system for opening an account.
• Foreign corporate/personal account.

The cost of additional services associated with offshore IBC registration in the Marshall Islands:

Cost of additional services

A set of copies of documents with an apostille	$1,900
Amended Articles of Association (plus additional capitalization tax, if applicable** Capitalization tax applies to corporations whose share capital exceeds five hundred (500) shares with no par value or with a total par value of more than USD 50,000 or its equivalent)	$1,200
Amended and Restated Articles of Association for BC	$1,625
Merger Agreement for BC	$900
Certificate of Conformity for BC	$1,500
Registered Protocol for BC, LLC, LP, GP	$750
Registered Articles of Association for BC	$750
Registered Power of Attorney for BC	$500
Certificate of Dissolution for BC	$600
Withdrawal of voluntary dissolution for BC	$2,250
Certificate of Appointment of Directors and Officers for BC	$900
Certificate of Appointment of Directors and Officers (apostilled) for BC	$1,400
Declaration of Shareholders and Beneficial Owners of Bearer Shares for BC	$1,200
Certificate of Authorization for BC, LLC (without apostille)	$900
Certificate of Authorization for BC, LLC (with apostille)	$1,400
Certificate of Good Standing (original) for BC, LLC, LP, GP (without apostille)	$750
Certificate of Good Standing (original) for BC, LLC, LP, GP (with apostille)	$1,250
Certificate of Registration for BC	$750
Certified copy of the registered document for BC, LLC, LP, GP	$700
Registered Articles of Association for BC	$800
Registered Protocol for BC	$800
Articles of Domestication for BC	$1,500
Certificate of Domicile Transfer to Another Jurisdiction for BC	$2,500
Registered Power of Attorney for BC	$700
Certificate of Amendment for LLC	$1,200
Certificate of Conversion for LLC	$1,500
Certificate of Cancellation for LLC	$1,000
Registered Operating Agreement for LLC	$750
Certificate of Domicile for LLC	$1,500
Certificate of Amendment for LP, GP	$1,200
Certificate Cancellation for LP	$1,000
Certificate of Dissolution for GP	$900
Apostille	$500
Financial report (up to 40 transactions per year)	$2,400
Financial report (41 to 150 transactions per year)	$4,500
Financial report (more than 150 transactions per year)	upon request
Virtual Office in Panama /per year • Address • Mail/Delivery to courier • Telephone with message recording function	$3,000
Professional director service	$3,400 + expenses

As laws in many countries (including the EU) are being amended, requirements for customers’ data protection are becoming stricter and stricter. Transferring data for registration of an offshore IBC in the Marshall Islands requires filling out a form of consent to personal data processing: date of birth, ID number, marital status, etc.

This form remains valid for 5 years, which means that no additional permits will be required during this time. You have the right to withdraw your consent to personal data processing at any time, but in this case, some services will become unavailable.

If you still have questions related to IBC registration in the jurisdiction of the Marshall Islands, feel free to write us a letter. And if you need any additional services related to a company registered in the Marshall Islands (even if it was not registered by us!), from opening an account with an offshore bank to registering ships or yachts in its name, contact us using the same address!