The emergence of offshore companies is prevalent worldwide. It is primarily because of tax flexibility in places like Singapore and the concept of anonymity. However, the perception concerning anonymity is presently changing. In addition to that, nominee services are still in use. The new age corporate service providers are usually requested by clients and companies to offer their new registered branch/offshore company along with shareholders or nominee directors.
Therefore, it’s crucial to understand nominee director services, its features, and benefits.
Understanding a nominee director service
A Nominee Director Service is a legal procedure to secure the anonymity and identity of an organization owner. The shareholder or Nominee Director can be a legal entity or a real person resorting to fiduciary duties in a company. The nominees get mentioned in an official register as a shareholder or company director. However, their actions are limited to the owner’s guidelines. Also, the assigned nominees don’t manage the company.
Based on the kind of agreement, the owners might sanction authority to operate the business, monitor the organization and also open, monitor bank accounts. Usually, the nominees officially represent the company and are accountable for any omissions and initiatives. However, it’s essential to know that the law doesn’t identify “nominee shareholder” and “nominee director.” Hence, if a company or person gets elected as a director, the accountabilities and duties are all bestowed on the nominee officer.
So, what does the nominee officer do?
The primary task of a nominee director is to help maintain the anonymity of the actual owner, by being there in all public records on the owner’s behalf, relating to the non-governmental bodies and company. Simultaneously, just in case the company’s owner wants to conceal his identity from tax authorities and other governmental agencies, then it’s not applicable.
Furthermore, a nominee director must never be mistaken for a resident director that the law appoints for the company creation is specific jurisdiction. You might need a resident director if you want to register a company in a place like Singapore. To know more on this, you could research online on nominee Director Plus Singapore and have access to valuable information.
When you the Nominee Director services get used?
The company owners usually make use of the nominee director services for following reasons:
- To make sure the ownership anonymity for non-governmental bodies and there’s secure disclosure of ownership data at times of public inquiry.
- When a company director needs to be present to carry out the business in another country as the beneficial owner has no scope to travel
- To retain the anonymity for signing agreements and conducting business deals
- When it’s essential to expand the statutory bodies by increasing members
- To be able to avoid legal limitations on transactions taking place between the affiliate bodies. The choice is beneficial for transferring assets inside a holding company.
Appointing nominee bank account signatories is an essential point to understand. Generally, the fiduciary service providers don’t manage the accounts of their clients as nominee signatories. As these services usually have high risks for both the nominal officer and client. Furthermore, when it comes to resorting to the nominee signatory, all the banks are going to need disclosure of the actual owner of the organization. If you try to conceal the real identity of the owner making use of nominee signatory, it’s considered illegal.
The nominee signatory services are usually high in price. Furthermore, one has to ensure remote and secure access to accounts via the e-banking systems. Hence, in most situations, it’s not required to appoint a nominee signatory.
How does it all work?
Are you all set to manage nominee director services for your branch or offshore company? If yes, then you need to reach out for a professional corporate service provider that will provide you with corporate documents. It includes essential documentation for legal security. Some of the papers provided include the following:
- Management Services Agreement-It administers all the managerial and commercial arrangements between the nominees and beneficial owners.
- General Power of Attorney signed by the nominee director-The beneficiary has the authority to manage and respond to legally on behalf of the organization as an authentic representative having full rights.
- Nominee Shareholder’s Declaration of Trust-This document helps to know the nominee, the number of shares he owns and for who does he holds the shares.
- Updated share transfer and signed by the nominee shareholder-With the help of this document, the company owner can sign instantly over the company ownership.
Other than these documents, expert corporate service providers at times provide the customers with a Consultancy Agreement. The purpose of this agreement is to engage in transparent and honest contracts keeping in mind the owner’s business association with his organization.
How to search for the best corporate service provider for you?
The first question to consider is where you are planning to set up your offshore business or company branch office. For instance, if you have Singapore in mind, then it’s a smart call to reach out to a service provider in Singapore? It will help you in better interaction and coordination. A region-specific service provider will have the better know-how on the economy, the taxation services, the anonymity guidelines and also will be able to better suggest on nominee director services. However, make sure you don’t use a nominee director service if there’s no need of it.
Also, make sure you understand if opting in for nominee director services will have an impact on opening a bank account. List down your questions and inquire about it at the consultation session with a probable service provider to get all doubts cleared. Furthermore, you need to remember to know the way your legal rights and ownership will be secured. Also, ask for the documents that will be given to be able to acquire the authority of your company from any nominee encroachments. Setting up a new business offshore or a branch company needs to follow a set of formalities. Partnering with a corporate service provider is essential. And if you have decided to opt-in for nominee director services, have a clear head about it and before signing up for the services.