![[En]](https://www.caymancompanyincorporation.com/system/cms/themes/default/img/smallflags/EN.GIF){kind=small}
Articles
Shelf Company in Cayman Islands
Updated on Monday 09th March 2020
Rate this article
based on 4 reviews
based on 4 reviews
When acquiring a shelf or ready-made company in the Cayman Islands, entrepreneurs receive a package which allows them to begin doing business immediately, without having to wait the time it takes to register a new legal entity in this jurisdiction.
Our Cayman Islands company formation consultants can provide you with a shelf company so that you can start doing business right away.
The advantages of a Cayman Islands shelf company
Buying a ready-made company in the Cayman Islands has a set of important advantages, especially for investors who wish to start doing business right away. The list below highlights these benefits.
- • Quick setup: The shelf company has a quicker setup process than the newly incorporated legal entity because all of its constitutive documents have already been prepared.
- • Fast business commencement: Investors have the advantage of being able to do business almost instantly when they buy an already existing company
- • Good credit: Aged companies will typically be more credible in front of credit institutions, banks and even clients in general.
- • General business longevity: Once again, the fact that the business has been incorporated for some time and does not have bad debt is an advantage in terms of business image.
Some investors may find it particularly useful to purchase a shelf company for its name. When this is the case, the primary reason for the purchase can be the name and not necessarily the business longevity, although this can be another added advantage. Investors who wish to open a Cayman Islands exempted company, for example, may choose to purchase one instead of starting the incorporation procedures themselves. If an existing company also has a convenient name, then it may be preferable to buy the company instead of using a similar name. Several conditions apply to naming the company (for example, one legal entity may not infringe the one of an already existing company) and there are limitations to the manner in which an investor can use an alternative of the desired name.
How to buy a shelf company in the Cayman Islands
Our Cayman Islands incorporation advisors can easily and rapidly facilitate the acquisition of a shelf company in the Cayman Islands.
It is up to the investor to decide which kind of company to acquire and to inform us of his or her intentions.
There is a wide variety of shelf companies which are available. We can provide various enterprise solutions, depending on your own requirements and needs.
An important step that is part of the shelf company purchase procedure is the due diligence phase. Essentially, this is a complete verification of the company’s particularities and situation, to ensure a safe purchase. It is highly recommended to go through with this phase and one of our agents who specialize in Cayman Islands company formation can assist investors who need to verify company information.
A shelf company due diligence will typically verify the following:
- existing debts: a complete verification of all business relationships with partners or suppliers will reveal if there are any current debts the company owed to other parties.
- contracts in force: any agreements that may have been signed need to be verified in order to determine any possible liabilities towards third parties.
- financial situation: the company’s accounts can be verified and, if needed, an audit can take place in order to establish a true, transparent financial situation.
- risk areas: any compliance issues regarding licensing, taxation and other registrations should be identified; these can vary according to the business field and the primary business activity.
These are just four general areas of interest for a due diligence proves. We highly recommend that a team of agents who are experienced in these matters and who are able to prepare a written report with the findings handle this step. In most cases, shelf companies will be sold when they have not had any type of business activities and no contract has been signed. However, a basic due diligence verification will ensure that this is really the case so that the buyer may rest assured that no unexpected situations will arise once he takes over the business. Investors who are interested in Cayman Islands incorporation can reach out to us for more details about this step.
We can also do a market research and analysis, obtain the necessary business licenses and product registrations which might be needed in the Cayman Islands.
When you decide that you want to acquire a shelf company in the Cayman Islands, all you will have to do is simply acquit the fees involved.
Our Cayman Islands company formation agents can offer you the following:
• a business name;
• an incorporation number;
• an office address and phone number for your business;
• bank account details;
• the company registration documents.
You can reach out to us if you need additional information about the shelf company packages we provide.
Steps for buying a shelf company in the Cayman Islands
After you have decided that you want to acquire a shelf company, our Cayman Islands incorporation consultants will have a discussion with you to present you with the most appropriate options.
Next, we will prepare the paperwork involved in purchasing a shelf company in the Cayman Islands. The documentation which has to be signed is the sale-purchase agreement.
The buyer also has to be attentive on the following steps after such company has been purchased. These steps consist of changing the name of the shareholders and directors and amending the Articles of Association of the company.
It is important to note that upon the transfer of ownership for the company, the liabilities are also transferred. This means that current and future debts pass to the new company owner/s and this can also include any unknown debts that may have existed. This is the primary reason to perform the due diligence, as previously mentioned. It is advisable to obtain a certificate of compliance when purchasing the company (for previously unused entities) or a warranty/deed of indemnity for companies that have been involved in trading before they were sold. Our Cayman Islands company formation agents can provide more details.
Cayman Islands incorporation
Purchasing a shelf company is a convenient and fast manner in which foreign investors can start their business activities, however, it is not a single option. Entrepreneurs can keep in mind that the general company formation process is a simplified one and it can be performed remotely in some cases, with the help of our team of experts. This is why, when the advantages of the shelf company are not expressly relevant for the business (such as its longevity) we recommend that investors also take into consideration the option to register a new company.
According to data made available by the Cayman Islands General Registry, the following statistics as per the number of companies applied in recent years:
- - 16,326: the number of new companies registered in 2018;
- - 13,046: new companies registered in 2017;
- - 11,174: new companies registered in 2016;
- - 89,552: or 84.3% of the active companies registered as of September 2018 were exempt ones.
- - 106,291: the total number of companies in the register as of September 2018.
Investors should keep in mind that the Cayman Islands Government imposes different types of requirements for companies and for doing business in general. Our agents can provide complete details on the laws and regulations that are currently in force.
If you require further information about shelf companies in the Cayman Islands, or for assistance in setting up a Cayman Islands company, please get in touch with us.
Comments & Requests
Meet us in George Town
Call us now at +1 (345) 949 4244 to set up an appointment with our lawyers in George Town. Alternatively you can incorporate your company without traveling to Cayman Islands.
As an International Management Services client, you will benefit from the joint expertize of local lawyers and international consultants. Together we will be able to offer you the specialized help you require for your business start-up in Cayman Islands.
Contact us
Comments
There are no comments