General Information
The Republic of the Marshall Islands is located in the central part of the North Pacific Ocean and consists of 34 islands, divided into the southeastern Ratak Chain and the northwestern Ralik Chain. The primary activities are agriculture and fishing, with the main export commodity being dried coconut kernel and pulp. The islands are atolls and coral reefs. The most significant islands are the atolls of Kwajalein and Majuro, the latter being home to the capital city, Majuro. The total land area is 181.3 km². The population of the Marshall Islands is approximately 63,000 people, predominantly Micronesians. The official languages are English and Marshallese.
The Marshall Islands were discovered by the Spanish in 1526; however, colonisation began only in the early 19th century. Between 1885 and 1914, the territory was under German protectorate, after which it was ceded to Japan. In 1944, it was occupied by the Americans. In 1946, Bikini Atoll was used as a testing ground for nuclear experiments, after which the Marshall Islands became part of the United Nations Trust Territory under U.S. administration. As a governmental entity, the Marshall Islands emerged in 1983 as a result of the division of the Trust Territory of the Pacific Islands. Since 1986, the islands have been in a “free association” with the United States.
The country’s laws are consolidated in the Marshall Islands Revised Code of 1988, with amendments and supplements. The creation of an International Business Company (IBC) is governed by the Business Corporations Act, which defines it as a company established for profit-making activities outside the territory of the Marshall Islands. Such companies are prohibited from trading with residents of the Marshall Islands, engaging in banking or trust activities, and providing insurance services.
General Characteristics of International Business Companies (IBC) in the Marshall Islands
The legislation of the Marshall Islands is based on the laws of the State of Delaware. The Associations Law includes the Business Corporations Act of 1990, the Partnership Act of 1990, and the Limited Liability Companies Act of 1996. The creation of an International Business Company (IBC) is governed by the Business Corporations Act, which defines it as a company established for profit-making activities outside the territory of the Marshall Islands.
Such companies are prohibited from trading with residents of the Marshall Islands, engaging in banking or trust activities, and providing insurance services.
There is only one type of International Business Company (IBC) in the Marshall Islands—a domestic non-resident corporation. This company is simple to establish and maintain. Although the Business Corporations Act is based on U.S. corporate law, some of its provisions are derived from English law. These provisions allow for the appointment of an Executive Director and a Corporate Secretary instead of the U.S. standard of a President, Treasurer, and Secretary. The company’s affairs can be managed in any country, where all information about its activities will be stored.
By utilising standard provisions, an International Business Company (IBC) can be established within one day. No annual reports are required for the company’s maintenance, and the company and its profits are not subject to taxation.
Confidentiality of Offshore Companies
The law permits the issuance of bearer shares. In the case of registered shares, government authorities do not maintain a register of shareholders. Additionally, there is no requirement to disclose the names of the company’s employees and directors.
Cash Flow
The United States dollar (USD) is the national currency.
General Requirements
| Name | The registered company name must not be identical to an existing one. The name must not include the following words or their derivatives: bank, royal, establishment, fund, insurance, partnership, or trust. The company name can be in any language but must be written in Latin characters. The Registrar has the right to request a translation of the name to ensure it meets the requirements. After the name, an indication of the legal form of a limited liability company should be included (Corporation, Incorporated, Limited, Gesellschaft mit beschränkter Haftung, Aktiengesellschaft, Société Anonyme, Sociedad Anónima). |
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| Subscribers | It is possible to establish a company with a single shareholder. |
| Authorised Capital / Shares | The standard authorised capital consists of 500 shares without par value or declared capital up to $50,000. The law stipulates certain fees if the number of shares exceeds 500 or the authorised capital exceeds $50,000. The authorised capital can be expressed in any currency. The minimum share capital can be one share with or without par value. Companies registered in the Marshall Islands can have the following types of shares: registered, bearer, preference, redeemable, with or without par value, and with or without voting rights. |
| Directors / Officers | The minimum number of directors is one. A secretary must be appointed in the company. Directors and secretaries can be individuals or legal entities and do not need to be residents of the Marshall Islands. |
| Registered Office / Agent | International Business Companies (IBC) must have a registered office and a registered agent. There is no currency control for companies that do not conduct commercial activities with residents of the Marshall Islands. |
| Reporting | There are no financial reporting requirements; however, records reflecting the company’s financial position must be maintained. |
Taxation and Payments
International Business Companies (IBC) are exempt from all local taxation. The Marshall Islands have not entered into any double taxation treaties.
