Uses of Offshore Companies
Directors and officers
A company director is charged with making all material decisions about the IBC and its business. Directors are initially appointed by the first Subscriber, and then elected by shareholders. Quite often the Director of an offshore company is elected for an open term "until his successor is elected and qualifies". If there is more than one director, all the directors together comprise the company`s Board of Directors. In this case they may actually have a rather complex system of decision-making process. Offshore companies are required to have at least one director, sometimes more. Seychelles International Business Companies are required to have a minimum of one director.
Many offshore jurisdictions, including Seychelles, permit the director to be a corporation. This may sound weird, but just imagine a management firm comprising of a team of highly competent management specialists who would take the duty of managing the company`s regular business. Nevertheless, utilizing a corporate director may blur the clear structure of a company and make it difficult to comprehend, especially for people who live in countries where "corporate directors" are not a common practice. More often than not the existence of a corporate director will also indicate that the company is most probably an offshore entity.
An individual director makes the whole structure more straightforward, just because we are more used to the fact that a director of a company must be a living, breathing person. There are not many drawbacks for an offshore company to have an individual director, apart from the fact that the services of individual directors would usually be more expensive than corporate. Another aspect, distant as it may sound, is the possible complication when such individual director falls ill, goes away for vacation or, as it may happen, dies. In case of a corporate director there will always be some person who will be empowered to sign or act on behalf of the company. In case of an individual director, there might not be. In such case the company would have to go through a lengthy process of registering a change of director in its file before the new director can act. Electing an alternate in the first place would therefore not be a bad idea. Just as well, a company may have one or several addition officers to fill various managerial and administrative roles within the company. The most common officer categories include President, Vice-President, Treasurer and Secretary. Some jurisdictions require that some or all of these roles be filled at incorporation.
The company directors may sometimes appoint managers or attorneys of the company, granting them certain powers to manage the affairs of the company. The manager may, for example, have a signing authority on a bank or securities account, or the powers to negotiate certain types of contracts for the company or do anything else that may be written in his power of attorney. Company shareholders or beneficial owners are quite often appointed as managers of the company for such purely practical reasons.
For further details on company directors and management, please also see the chapter Company Management.