Jurisdiction of the month: Belize

2015 02 24 | Category: News

Editor News Leave a Comment

Geography, Population, Languages

Belize (before 1973 British Honduras) is a picturesque country that has an unspoiled environment, with barrier reefs, woodland, caves, rivers, mountains, waterfalls and jungle. It is located in Central America in the south-eastern part of the Yucatan Peninsula. Its shores are washed by the Caribbean Sea. The area of the country is approximately 23,000 sq. km, and it is bounded by Mexico to the north and Guatemala to the west and south. The administrative capital is Belmopan, but the major commercial centre is Belize City, situated on the east coast close to the major International airport.
The total population of Belize is about 300,000, of which about a third lives in Belize City. Much of the country’s population is ethnically diverse and includes descendants of the original Mayan culture, as well as people of Caribbean, Caucasian, Chinese and East Indian descent. Over 50 per cent of the population is urban. English is the official language although Spanish, Creole, Garifuna and Mayan are widely spoken throughout the country.

History, Political Structure and Law
Belize became a British Crown Colony in 1871 and achieved complete self-rule in 1981. Since that time it has enjoyed stable and democratic Government. Now Belize is an independent democratic Commonwealth country. Government policy is set by the Cabinet, under the leadership of the Prime Minister. The Cabinet is made up of the Prime Minister and Ministers appointed by him from an elected 29-member House of Representatives, and the 12-member Senate. Belize is also a member of the United Nations and the Non-Aligned Movement. There are two main political parties, both of which encourage the economic development of the country and overseas investment.

The type of law is Common Law, based on English Common Law. Legislation is modelled on the earlier British Virgin Islands legislation.

Economy and Infrastructure
Belize’s main income is from tourism. There are forest reserves, wildlife sanctuaries, marine resort areas, the world’s only jaguar reserve, as well as Mayan archaeological sites that are a magnet for tourists from all over the world. The major exports are sugar cane, bananas, fruit juices, canned fish, garments and timber and wood products. The offshore finance industry is generating an increasing proportion of national income. The currency used is the Belize Dollar (BZ$). Offshore activities are exempted from exchange control.

Company Incorporation
The principal piece of Company legislation is the International Business Companies Act, 1990. A Company incorporated in Belize has the same powers as a natural person. The language of legislation and corporate documents is English.
The type of company for international trade and investment is an International Business Company (IBC).

An IBC is subject to the following restrictions on trading and business activity:
• An IBC is not allowed to trade within Belize or own real estate there;
• An IBC is not allowed to engage in the business of banking, insurance, assurance or reinsurance.

Incorporation procedure is as follows: a Registered Agent delivers the Memorandum of Association and Articles of Association to the Registry, together with the appropriate fee. A registered office must be maintained in Belize at the address of a licensed management company. There are no specific statutory provisions governing secrecy in relation to companies, but English Law, which applies within the jurisdiction, does impose a common law duty on professionals to keep the affairs of their clients confidential. In Belize off-the-shelf Companies are available.

A Belize IBC name can be incorporated using any language.

The following name restrictions apply:
• A Company cannot use a name that has already been incorporated, or is so similar as to cause confusion.
• A Company cannot use a name that in the opinion of the Registrar is considered undesirable, obscene or offensive.

Names such as Royal or Imperial, or any name that suggests the patronage of the Belize Government, are not acceptable.

The following words either in English or any other languages: Bank, Building Society, Chartered, Co¬operative, Savings, Loans, Insurance, Assurance, Reinsurance, Trust, Trustees, Chamber of Commerce, University, Municipal, Or any name in English or a foreign language that may suggest association with the banking or insurance industries require consent or a licence.

Limited, Corporation, Incorporation, Societe Anonyme, Sociedad Anonima, Gesellschaft mit beschraenkter Haftung or the relevant abbreviations are the required suffixes to denote limited liability. A minimum of one director is required and corporate directors are permitted. Directors may be natural persons or corporate bodies. They can be of any nationality and are not required to be Belize residents. A Company secretary is not a requirement under the Act, but a secretary is normally appointed to facilitate signing obligations. A minimum of one shareholder is required. No details of the shareholders or directors appear on the public file, but a register of shareholders must be kept at the registered office address of the company in Belize.

The normal authorised share capital is US$ 50,000 divided into shares with or without par value. The share capital may be expressed in any currency. The minimum issued capital may be one share of no par value or one share of par value.

Annual Taxation and Fees
Particular features of taxation in Belize are as follows: although there are fairly high rates of tax for resident persons and companies in Belize, the country now offers tax-free IBCs by virtue of the IBC Act 1990. Belize is not a party to any double tax agreements.

The annual fee depends on the value of the authorised capital as follows:
• Companies with an authorized capital up to US$ 50,000 pay the sum of US$ 100 per year.
• Companies with a share capital over US$ 50,001 pay the sum of US$ 1,000 per year.
• Companies some or all of whose shares are of no par value, pay the sum of US$ 350 per year.
• Penalty fees of up to 50% of the annual Government fee will be incurred if the license fee is not paid when required.

Financial statement requirements are follows: although there is no requirement to file audited accounts with the authorities, a company is required to keep financial records to reflect its financial state.

EditorJurisdiction of the month: Belize