Samoa

Geography, Population, LanguagesSamoa Offshore Company Formation

Samoa is a group of 14 islands in the middle of the South Pacific, approximately equidistant from Honolulu and Sydney and immediately east of the International Date Line. The islands have a total land area of about 3,000 sq. km. The islands are mountainous and have dense tropical vegetation. The coastal areas are more undulating and are cultivated for agriculture. There are many beautiful white, sandy beaches, which are protected by the coral reefs that surround the islands. Samoa is divided into two parts. Eastern Samoa belongs to the US, but Western Samoa has been an independent state since 1962. Western Samoa comprises two large islands and several small islands Western Samoa is 2,842 sq. km, its population is about 214,000. The island of Upola is the most developed of the islands. The administrative and commercial centre of Western Samoa is its capital, Apia. Ninety per cent of Samoans are indigenous Polynesians. The remainder of the population is part Samoan, part Chinese, or of European extraction. The Samoan Polynesian language is dominant, but English is widely used.

History, Political Structure and Law

Samoa has been fully independent since 1962, and its constitution provides for a parliamentary government, which combines the traditional Samoan social structure and a democratic voting system. There is a forty-seven member Legislative Assembly which consists of forty-five Matai title holders (the heads of each extended family) who are elected by their peers and two non-Samoan residents who are registered on the Universal Voters’ Roll. Parliamentary elections are held every three years.

The legal system of Samoa is based on English Common Law and incorporates a considerable body of New Zealand statute law, due to the fact that prior to independence New Zealand was the administrating authority of Samoa. The First Supreme Court of Samoa possesses and exercises all jurisdiction, power and authority necessary to administer the laws of Samoa. Samoa’s Court of Appeal hears appeals on any judgement, decree or order of the Supreme Court in either its civil or criminal jurisdiction.

Economy and Infrastructure

There are regular international flights to and from Australia, New Zealand and the surrounding Pacific islands. The modern international airport can accommodate 747-type aircraft. It is served by Air New Zealand, Polynesian Airlines (the national carrier) and Air Pacific. These services give direct access to New Zealand, Australia, Fiji, the Cook Islands and Hawaii.

The country has adequate docks and is well served by pacific regional shipping services.

Samoa has a sophisticated international satellite telecommunication system.

Agriculture employs 50% of the workforce and contributes more than 50% of GDP and 90% of exports. Tourism has now become the most important growth industry. Samoa has a literacy rate of 97%.

The local currency is the Samoan Dollar (Tala). There are no Foreign Exchange controls.

Company Incorporation

The principal Corporate Legislation is based on the following Acts:

  • The International Companies Act, 1987 (amended).
  • The Offshore Banking Act, 1987.
  • International Trusts Act, 1987.
  • The International Insurance Act, 1988.

There is also separate corporate legislation for resident companies.

An International Company has all the powers of a natural person. The corporate documents of an International Company may be in any language.

There are two types of Company used for international trade and investment:

  • The Samoan International Company (IC) incorporated under the International Companies Act of 1987 (amended);
  • The Samoan Creditor Controlled International Company (CCIC) – a company without share capital.
The Samoan International Company (IC)

The following restrictions apply to the trading and business activities of Samoan Companies:

  • An IC cannot trade with Samoans nor own local real estate.
  • An IC cannot engage in the business of banking, insurance, assurance, reinsurance, fund management, the management of collective investment schemes, trust management, trusteeship or any other activity that may suggest an association with the banking or insurance industries, without obtaining the appropriate licence.

Incorporation procedure involves submission of the company’s Memorandum and Articles of Association and the registration fee to the Registrar of International and Foreign Companies. A registered office must be maintained in Samoa at the address of a licensed trust and management company. Off-the-shelf companies are available.

Company names are subject to the following requirements and restrictions:

  • Names may be expressed in any language. The Registrar may request an English translation to satisfy him that the proposed name is not a restricted or licensable name.
  • Any name that is identical or similar to an existing name is not acceptable.
  • Any name which in the opinion of the Registrar is undesirable, offensive or indecent is prohibited.
  • Any name that may suggest royal or government patronage is not permitted.
  • Any name that suggests an association with the banking or insurance industries is unacceptable.
  • Names including the words Bank, building society, savings, loans, trust, trustees, insurance, assurance, reinsurance, co-operative, council, Chamber of Commerce, university or their foreign language equivalents, require consent or a licence.
  • Limited, Corporation, Incorporated, Societe Anonyme, Sociedad Berhad Anonima or abbreviations thereof must be used as suffixes denoting limited liability.

The minimum number of directors required for an IC is one. An IC must appoint a company secretary. Both directors and company secretary may be natural persons or bodies corporate, may be of any nationality and need not be resident in Samoa. The minimum number of shareholders is one unless a specific type of debenture is outstanding, in which case the company is permitted to have no shareholders. Shares must be issued in registered form. Details of directors and shareholders do not appear in the public register.

The normal authorised share capital for an IC is US$ 1,000,000 (expressed in any currency). The minimum issued capital is one share with no par value or one share with par value. The classes of shares permitted are as follows: registered shares with or without par value, preference shares, redeemable shares, shares with no voting rights and discounted shares. Bearer shares are not permitted.

The Samoan Creditor Controlled International Company (CCIC)

A CCIC can operate without share capital and without shareholders and enjoy all the usual rights normally exercised by shareholders. It is “owned” by the holder(s) of bearer debentures. It is possible to allot a non-voting redeemable preference share to a non-resident of Australia to ensure the company is in fact a “company” rather than some exotic derivative, if this is felt necessary.

The following requirements apply to the registration of CCICs:

  • As a matter of local company law the company must maintain a registered office address within Samoa and must also appoint a Samoan resident as secretary and registered agent.
  • Names must end with one of the following words or abbreviations thereof – Limited, Corporation, Incorporated, Societe Anonyme or Sociedad Anonima.
  • Use of the following words and their associated activities is not permitted: Assurance, Bank, Building Society, Chamber of Commerce, Chartered, Co-operative, Imperial, Insurance, Municipal and Royal.

A minimum of one director is required and corporate directors are permitted. Details do not appear on the public file.

Annual Taxation and Fees

Companies incorporated under the International Companies (IC) Act of 1987 are not liable to pay any income or corporation tax. CCICs also pay no taxes in Samoa.

Samoa is not a party to any double tax agreements.

An IC pays an annual licence fee of US$ 300, unless at the time of incorporation it elects to pay a 5-, 10- or 20-year licence fee as follows:

  • 5 years US$ 1,000
  • 10 years US$ 1,500
  • 20 years US$ 2,000.

There is no requirement under the International Companies Act of 1987 to file accounts. A company is required to keep financial records that reflect the financial position of the company. It should be noted that penalties will be incurred if the licence fee is not paid when due.