Whatever the purpose for your offshore company, offshore business must follow some basic rules as some arise from local legislation and some are necessary because of Czech authorities and their common practice.

Most often grounds that lead to purchase and use of offshore companies are:

• tax planning and optimization
• asset protection and anonymous ownership
• advantages of foreign / non-Czech legal system
• perfect image and company prestige of an international HOLDING
• avoiding regulation of some business activities

Before formation and using of offshore companies it is prudent to present basic principles of offshore business:

1. Formation of an offshore company is not enough

Formation of an offshore company without a good business analysis, high-level tax planning and configuration and management of optimizing structure may bring a lot more troubles than good. The key to tax optimizing is professional tax planning executed and administered by well educated and experienced partners.

2. international tax planning – offshore is not the best thing for everybody

You must always check if your business may use offshore company advantages. That is why detail analysis of your business objectives is needed and targets must be stated for your future international tax planning.

After forming or buying an offshore company you must accurately and in much detail plan its activities and configuration in structures or business of your enterprise. It is always necessary to use professional knowledge of various legislations in order to bring offshore business into practice and regular monitoring of your activities, objectives and needs is vital.

3. Right choice of offshore jurisdiction

Based on complex analysis we always propose a jurisdiction of choice to best befit the needs of your business.

4. Personal and confidential partner

There is a strong need of full loyalty between you and your service provider, a relationship of confidentiality and trust. Names of owners of offshore companies are not and sometimes should not ever be seen for practical reasons. That means your offshore partner holds the structure and keeps all the original corporate documentation, that if needed shall prove the owner of the offshore company. You alone shall decide whom and when we are to show these documents.

5. TRUST and NOMINEE structures

Similar to above mentioned owners of offshore companies, in some situations it is not desirable for the Director you have in the offshore company to be publicly accessible information. In such situations it is desirable to choose a loyal Director or Administrator of your offshore company.

This setting where you do not act yourself is called "TRUST" or "NOMINEE". By definition these are situations where somebody acts and signs upon your instructions and in trust. But if the time ever comes when you need to act or sign on behalf of your offshore company, part of our documentation always is a general power of attorney for all possible tasks and acts, both in Czech and English language and with al due legalizations.

6. Corporate documentation
Offshore companies differ in documentation based on their jurisdiction, but you always get these following documents:

a) Certification of relevant local authority on existence of the company, its name, registration number and date on which it was registered. In various jurisdictions these authorities vary in names, but they always come on official certificate paper and with all due legalization stamps. These certificates are always rock-solid for all Czech authorities.

b) Memorandum of Association (Company Charter, Statute, Articles of Organization, Certificate of Formation)

This documents presents the basic facts about the offshore company: name, registration number, registered office, legal form, registered activities and/or business licenses and sometimes initial Director(s) and initial subscriber / shareholder.

c) Articles of Association (Operational Agreement):This document states details of organization, processes, share distribution and transference.

d) Power of attorney: If under given circumstances the local Director cannot be used, it is very important that you or any other person you so choose hold power of attorney.

e) Bank account documentation: Offshore company may have CZK and other currency accounts that naturally can come along with a bank card. Account may be controlled via electronic banking. A great advantage of offshore companies is their accounting records: they generally keep accounting records only on transactions pertaining to their home destination. Any other payments, flows and transactions are not of any interest to the local financial officers and inland revenue.

7. Business of offshore companies within the Czech Republic

If you want to use your offshore company for direct business within the Czech Republic, usually as a supplement for a Czech limited liability company while keeping some advantages of an offshore company, you shall have to register for corporate tax and potentially also VAT. We can register that for you, as well as for social security, labor department a and health insurance, as long as you so wish in case your offshore company shall be an employer. In some cases a permanent branch office shall have to be registered with the local commercial register, and take care of some other pertaining administration.

8. Legal acting

Every offshore company must take a number of legal steps each year in order to work the way you intended. Most commonly these are drafting and signing contracts, forms, letters of credit or notes, bills and invoices, declarations, resolutions, powers of attorney etc. Analysis of these documents and their drafting and signing shall be executed for you by your offshore partner.