Company with bearer share
In the modern world, bearer shares are considered a risky financial instrument. Businesses - the powers of Europe and Asia prohibit local companies from issuing them in order to avoid fraud and getting on the EU "black list". However, such securities are still in demand among entrepreneurs.
Bearer shares: who needs them and why?
Such securities were particularly popular during the 'offshore era'. In the English-speaking world, they are called the "Bearer Share" and make their owner a full participant in the business. It is enough to physically own shares on certificates with a "bearer" (Bearer Share) in place of the name to manage the company.
The main purpose of bearer shares is to keep secret the identity of its owner, most often the actual owner of the business. The objectives may vary and, most often, are not quite legal: to conceal part of the income, tax evasion, doing business contrary to the requirements of current legislation. Although such securities were created for a completely different purpose: with their help it was convenient and easy to prove your right of ownership or transfer property to a partner.
Advantages of Bearer Share
- Keeping the owner anonymous;
- Easy way to transfer to any individual;
- Ability to keep financial assets safe;
- Exclusion of reputation risks;
Disadvantages of bearer shares
- The opportunity to lose the certificate (loss, theft), and with it, the property right of the company;
- Difficulty in opening a bank account (in accordance with the requirements of the changed legislation).
Where it is possible to open a company with bearer shares.
There are not many countries that are ready to register a company that issues bearer shares on their territory.
The most favorable conditions in the Seychelles and Turkey. A local company with bearer shares can indeed keep its bearers (bearers) confidential. Seychelles is also a classic offshore zone that allows to reduce tax expenses as much as possible, though there is a possibility that when opening a corporate account, the bank, under the international program "know your client", will still ask to reveal the secret identity of all beneficiaries.
In Europe, to create a company with bearer shares may allow Luxembourg and Switzerland, but the identity of "bearers" will have to open a bank and a lawyer.