Belize’s reputation in the international business arena has been improving. Today, it is a politically stable democratic state in Central America that is attractive for setting up a company there. The process of registering a company in Belize is simple and rather fast.
You can benefit from opening a company in Belize if you would like to work in the following areas or if you pursue one of the following goals:
- Global trade.
- Inheritance planning.
- Asset management.
- Holding real and personal property.
The service that is responsible for promoting investments into the prioritized sector of the economy in the country is called BELTRADE).
Main advantages of opening a company in Belize
Belize has an advanced banking and financial sector. The legal system is based on British Common Law, which means that you can set up a company in Belize remotely and manage it from home. Because English is the official language in Belize, cooperating with US companies is easy.
Your Belizean company can be tax-free. An IBC does not have to pay any local taxes including income tax, dividend tax, or capital gains tax. Besides, no stamp duty is payable when transferring property rights. The main payment that an IBC has to make in Belize is the company registration fee. The fee has to be paid once a year.
You don’t have to deposit any registered capital when opening a company in Belize. If your company does have registered capital, it can be in any currency. You will have to pay a state duty when creating a company in Belize but it is rather modest. Your company can have only 1 director and it can be a private individual or a corporate entity. The director’s nationality/ residence will play no role.
Belize offers incentives to foreign people and companies investing in the local economy. There is an Export Processing Zone, for example, offering great conditions for manufacturing goods for export. In addition, there are Free Commercial Zones in Belize and a fiscal stimulus program. Besides, Belize has preferential trade agreements with several countries and international groups:
- Preferential trade conditions in the common Caribbean market (CARICOM).
- Preferential trade conditions with the USA.
- In accordance with the agreement between Caribbean countries and Canada (CARIBCAN), some goods produced in Belize are imported to Canada duty-free.
Available forms of company ownership in Belize
You can register one of the following types if company in Belize:
- A Limited Liability Company (LLC).
- A Limited Partnership.
- An International Business Company (IBC).
- A trust.
- An international fund.
- A subsidiary.
It is important to choose the right company type if you want to minimize your fiscal obligations and leave space for company growth. Please note that IBCs and LLCs are the most popular types of company in Belize as far as foreign company founders are concerned.
A Belizean-registered IBC
The number of IBCs registered in Belize has been growing at the fastest pace in the world over recent years. A Belizean IBC possesses the following key characteristics:
- No need to deposit any registered capital.
- No need to keep accounting records.
- No need to hire local directors/ company secretaries.
- No need to hold annual shareholders’ meetings.
- Personal information about company directors/ shareholders is highly confidential.
An IBC in Belize can conduct business operations in the following areas:
- Banking business.
- Insurance and reinsurance business.
- Fiduciary business.
- Collective investment schemes.
- Asset and capital management.
How can you open an IBC in Belize?
You have to go through the following stages if you want to set up an International Business Company in Belize:
- Appoint a registration agent.
- Choose the company name and submit it for approval.
- Acquire a registered legal address in Belize.
- Prepare the constituent documents.
- Apply for a business license/ company registration.
- Open a bank account.
As far as the company name is concerned, you should bear in mind that it cannot be already in use in Belize. Moreover, it cannot sound similar to the name of an existing company. Please also note that the Memorandum and Articles of Association have to be drawn up in a proper manner. You have to submit the following documents when applying for company registration:
- A neatly completed application form.
- Company directors and shareholders’ person documents.
- Proofs of addresses for all company directors and shareholders.
- A well-thought-out business plan.
These are the steps that you have to take if you want to register a business in Belize. We recommend that you seek expert advice on the matter to avoid possible mistakes.
The process of setting up a bank account in Belize
The first thing to do is to choose the bank from those stationed in Belize. The choice will depend on your prevalent business objectives. To start with, you can look at Belize Bank, Caye International Bank, or Atlantic International Bank in Belize.
After you have chosen the bank, you can open a corporate account and sometimes it can even be done remotely. Normally, banks request the following information:
- Company name.
- Names of company directors and shareholders.
- Distribution of equity interests.
- Types of business activities.
- Mail address to send documents to.
If the bank administration is satisfied with the information, you will have to submit some documents that confirm the truthfulness of your statements and the seriousness of your intentions. These include the following ones:
- A completed application form for bank account opening.
- A copy of a utility bill to serve as proof of address.
- A copy of the company Registration Certificate.
- Two Letters of Recommendation from other banks.
- Shareholder Certificates.
- Notarized copies of company directors, shareholders, and account signers’ passports.
- Copies of the Memorandum and Articles of association.
Please note that banks may request some other documents too.
Some banks in Belize will ask you to make a deposit when opening a corporate account. Some of them do not but you have to have a thousand US dollars at hand just in case.
Economic substance requirements in Belize
Similarly to other Caribbean countries, Belize has had to pass some new laws in order to conform to the international requirements concerning economic substance. A Belizean IBC has to meet the substance requirements if it is accredited by the Belizean Financial Service Commission and if it is engaged in one of the following business areas:
- Banking or insurance business.
- Financial services or leasing operations.
- Fund management business.
- Distribution services.
- Shipping business.
Please note that if you establish a holding company in Belize and one of its subsidiaries is engaged in one of the business areas specified above, the company will also have to meet the substance requirements.
You have to have a company office in any case and depending on the scale of your business operations, you may also have to hire a sufficient number of company employees. Besides, a sufficient number of Board of Directors’ meetings have to be held in Belize and strategic business decisions have to be made in Belize too. Admittedly, the economic substance requirements increase the company maintenance costs but this is the reality of the modern world and everybody has to put up with it.
Additional incentives that Belize offers to foreign investors
Belize is a country with a developing economy and it needs foreign investments to help the economy grow. For this reason, the authorities of Belize offer serious incentives to foreign entrepreneurs. The key incentives include the following ones:
- 100% foreign ownership of land and company assets is possible.
- Joint companies established with local partners are welcomed.
- Flexible fiscal bonuses are available.
- Free Commercial Zones and an Export Processing Zone in Belize offer attractive tax regimes.
- The financial service industry is well-developed in the country.
It is not for nothing that the number of IBCs registered in Belize has been growing rapidly. With the economic substance requirements in place, it is more expensive to maintain a Belizean-based company now than it used to be before but it still makes good economic sense to start a company in Belize even under new conditions.