International Business Corporations
International Business Corporations (IBCs) By William Cate Published October 1999 [http://home.earthlink.net/~beowulfinvestments [http://home.earthlink.net/~beowulfinvestments/globalvillageinves tmentclubwelcome/]
Most American Multinational Corporations operate outside the States as an IBC. If you call their export division, you'll find that you are talking to someone in Zurich or Nassau. The reason is that using an IBC to sell their products or services overseas saves the company on taxes.
Had the 19th Century founders of these icons of American Industry foreseen the 20th Century Western tax revolution, Switzerland would have been the home of American industry. Since WWII, Swiss Tax legislation makes Switzerland a poor choice for an IBC. But, if you follow my public company strategy, you need only worry about the next Decade, not the next hundred years.
Professional money trades through IBCs. New hot shot stock brokers see that the money appears to be located in Geneva, St. Vincent, Douglas, etc. They save their money for a trip to visit the IBC investors in Europe, H. K, or the Caribbean. They may have a great vacation. They never find the investors. To find those investors, they should have gone to Houston, Miami, New York, London, Toronto and other cities where stock market professionals live.
Public companies with a global market for their goods or services are worth taking public. It's wiser to incorporate the global company in a Caribbean tax haven than in Delaware, Nevada, or Ontario. Your tax haven incorporation won't reduce your corporate taxes on income your company earns in Canada, the United States or Germany. It will reduce your international tax obligations. If you doubt me, review the audits of any American multinational corporation trading on the New York Stock Exchange. You can find their audited financial statements at the U. S. Securities and Exchange Website.
Owning the insider stock of a public company through an IBC makes sense, if you aren't part of the "Pump & Dump" crowd. If your tax haven IBC holds the stock for several years, the tax consequences are no different from your holding your stock without selling it. However, at the point of eventual sale, if your plan is to live out your life in a tropical paradise, you can legally save on your taxes. This statement is truer for Canadians than Americans, but an IBC will save you tax dollars.
If you are going to trade stock for a living, you are better off trading it through an IBC. Let me cite one example. Under Canadian (Provincial) Securities Law, a Canadian resident can't receive the stock dividends from an American spinoff. Canadian residents are paid two Canadian cents (C$0.02) for each share of stock they would have gotten. Had they lived anywhere else in the World, they would get stock worth dollars per share. The stock is worth hundreds of times more than the Canadian cash payment. Assorted laws in many jurisdictions ensure that professional stock players trade through an IBC.
If you want an example of the widespread use of tax haven trading, the VSE objected to the Standard Charter Bank (SCB) in Nassau several years ago. The objection was that this British Bank seemed to be an inside trader in many VSE stock scams. In fact, the SCB had no interest nor involvement with the VSE. They did have VSE stock promoters as clients. These clients traded VSE stock through the SCB.
Do you have a reason to form an IBC, now? If you want my help, I'll be leaving November 1 for my biannual two-week IBC trip to the Caribbean. I form IBCs for clients. I oversee the IBC process to ensure that the paperwork is handled quickly and efficiently. This ensures that the process in completed on time and on budget.
To contact the author: Visit the Beowulf Investments website: [http://home.earthlink.net/~beowulfinvestments/] Or, visit the Global Village Investment Club Website: [http://home.earthlink.net/~beowulfinvestments/globalvillageinves tmentclubwelcome/]
About the author: He has been the Managing Director of Beowulf Investments [http://home.earthlink.net/~beowulfinvestments/] since 1981 and is the Executive Director of the Global Village Investment Club [http://home.earthlink.net/~beowulfinvestments/globalvillageinves tmentclubwelcome/]
