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English is the official language of the country. Political and judiciary systems are closely related to and follow the UK traditions. The UK monarch is the head of the Bahamas, who appoints a governor to represent her locally. Legislative power belongs to a bicameral parliament, executive power is exercised by a cabinet, headed by the Prime Minister. Even though the Bahamas are not located in the Caribbean Sea, the country belongs to the Caribbean Community. Geography All the islands of the Bahamas are low and rather flat, which generally rise not higher than to 20 metres above the sea level. The highest point though is Como Hill, the height of which is 63 metres. Map, Flag and Coat of Arms
Types of Company Domestic Limited Company This type of company is usually formed with the objective to conduct a local business. A register of company members is publically available. Such a company must have at least two directors. Financial statements need not be filed. If exchange control permission is granted, bearer shares can be issued. Shares of no par value are allowed. Limited Company by Guarantee A minimum requirement of two members must be satisfied, in order to form this type of company. In the company documents members must specify up to which amount they guarantee company’s debts. A register of members must not be submitted annually and the control over the company can be obtained without shares. Moreover, in many jurisdictions, profits derived by this type of company are regarded as capital gains rather than income, so being treated differently for the tax purposes. Public Company This company is limited by shares, and shares may be offered to a general public. Such a company should have at least three directors and corporate documents, including a list of all company’s officers, should be kept in the registered office at all times. International Business Company This is a type of company used for offshore purposes in the Bahamas. It is usually incorporated as a private company limited by shares. Since 2001 this type of company is required to submit the details of its shareholders and directors to the Registrar. Other requirements are relatively flexible. A company may have only one director which can be a private person or a corporate entity; persons of any nationality and residence can be members and directors; accounts need not be audited and need not be kept; it can be managed from the Bahamas and is exempt from any kind of taxes and exchange controls. This company may not conduct baking and insurance business, no ownership in real property in the Bahamas is allowed, as well as it must not complete any transactions with residents of the Bahamas. Limited Duration Company It is an International Business Company the duration of which is limited up to 30 years. This type of company is often used by the US entities, and when structured in a particular way, a limited duration company may have a form of a partnership, which is treated in the US as a Limited Liability Company. Foreign Company In case a foreign company wished to operate as a trading branch in the Bahamas, it must be registered in the jurisdiction by submitting the required documents. In case such a company intends to conduct a business on the territory of the Bahamas and/or employ more than two Bahamians, it is required to obtain a business license. After the registration procedure is completed, this company can obtain an International Business Company status. General Partnership The liability of all the partners of a general partnership is unlimited. Limited Partnership In order to establish a limited partnership, a partnership agreement must be created and submitted with the authorities. At least one general and at least one limited partner must be present in order to establish a partnership. Limited partners are liable to a partnership’s debts up to the capital invested into the structure. Limited partners may not participate in a partnership management. As limited companies, also limited partnerships need to obtain a business license, in order to operate in the Bahamas. Exempted Limited Partnership This structure has a form of a limited partnership but follows the rules and regulations applicable to an International Business Company. A general partner may be a limited partner at the same time. At least one general partner must be a resident of the Bahamas or a Bahamian International Business Company. This type of partnership must be registered with authorities, and the details of all general partners must be filed. Trust Trust law of the Bahamas is based on the English law. Trusts that do not hold any property and do not trade in the Bahamas, as well as have non-resident beneficiaries are exempted from all types of taxes. A Trust must have a registered representative. Foundation This structure was introduced in 2004 in the Bahamas, in order to enlarge wealth management opportunities within the jurisdiction. It is a distinct legal entity, which has no perpetuity obligation. External audit is not an obligatory requirement. Redomiciliation of a Bahamian foundation to another jurisdiction and vice versa is possible to effectuate. A foundation is often used for estate planning purposes, but there are other goals for which this type of structure is particularly favourable. Accounts of the foundation must be kept, as they can be subject to the inspection, however confidentially provisions forbid disclosing this information without having received consent from a founder and beneficiaries of a foundation. Segregated Account Company This is a company which is allowed to create segregated accounts from the account of other companies. Every person who deals with this company must be specifically informed that this is a Segregated Account Company. Rights and obligations of all the entities who deal with this type of company are specified in a contract in each particular case.
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