How to choose the Right Offshore Service Providers
The specialized providers
The specialized providers have a narrow focus on the offshore services available in one particular jurisdiction. Such providers are usually physically located in that jurisdiction, they are licensed by the local regulatory authority as Registered Agents or International Corporate Service Providers. Due to their narrow focus, the specialized providers tend to be experts in everything on offer in their particular jurisdiction. The specialized offshore provider (Registered Agent) is usually the one who actually prepares the incorporation documents, goes to the Registrar of Companies, files and receives the paperwork and does all the grunt work associated with the offshore company formation. Professional in their area of work, fast and cost-effective, the specialized providers are the "source" of the offshore incorporation services.
Downside? The "source" providers would be naturally biased towards their home jurisdiction. When asked to compare the benefits of different jurisdictions, their home country would unsurprisingly be a clear winner. Specialized providers are sometimes also unable or unwilling to set up complex, multi-jurisdictional arrangements as may be necessary for some more complicated business models. But for a client who has done his homework and knows exactly which jurisdiction and what sort of offshore company and services he needs, dealing with a genuine local Registered Agent is clearly the best bet.
The local, specialized offshore service providers are also not all the same. There are distinctions, same as in any other business.
The older, mature Registered Agent firms would tend to be less flexible, conservative, slower and sometimes cumbersome to deal with. They would usually be more expensive, too. On the upside, the "old players" would usually have a solid internal framework, experienced senior staff (if You can cut through the receptionists and secretaries). The older Registered Agent would have the implied benefit of being around forever and "knowing the turf".
The new or smaller players in the market would quite certainly be quicker (sometimes also quick to over-promise), and generally easier to deal with. What they may lack in experience and sheer market presence, is often compensated by better customer support, flexibility and, of course, cost-efficiency.
As far as just incorporating an International Business Company is concerned, it is a fairly standardized service, almost a commodity. Apart from purely cosmetic variations between two standard packages of documents of, say, a Seychelles IBC, there is no legal or practical difference between an offshore incorporation provided by a startup Registered Agent or a fifty ear old law firm.
From this perspective, it would seem appealing just to look for the lowest price, right?
When going for the lowest possible cost, the client will usually land with an undercutter, who is desperate for a quick boost. Sometimes, it just does not work out. Rock-bottom fees usually can`t support decent record-keeping and database facilities, adequate internal security and confidentiality controls and a dependable, competent staff at the Registered Agent office. Dealing with a super-low-cost offshore provider may turn into a nightmare - certainly not worth the initial saving of a few hundred dollars. In the rush for volume, an uncsrupulous provider will inevitably make mistakes (very costly and time-consuming to correct), encounter delays and will be unable to provide personalized attention to non-standard requirements. These providers have an industry-nickname: "bucket shops".
As often, the best bet is somewhere in the middle, between the rip-off prices charged by the "brand name" providers and the bargain basement of price-warriors. In any established offshore financial centre there will be a fair number of reasonable, reliable and experienced Registered Agents, who take their work personally and seriously. At Fidelity Corporate Services, we tend to belong to this group.