Swiss Trust Company

A Swiss Trust Company is a dormant Swiss corporation, either an SA (Société Anonyme) or AG (Aktiengesellschaft), that has been purchased from its original owner and reinstated. The buyer receives a tax and liability release certificate and takes over operation of the entity.

A “seasoned” Swiss company has an original incorporation date that remains intact providing increased levels of goodwill, prestige, and marketability. This can be very valuable when merging operations into an existing Swiss company, when added to an investment company or offshore bank structure, or when justifying transactions with the company that might be questioned if it was a newly formed entity created at the time of the transfer.

Offshore Mail Forwarding Address

Often an offshore company address is nothing more than a mail drop assigned to the offshore company. Bank statements, invoices and any other type of company mail may be sent to this address. The mail will typically be picked up each or every two weeks by the offshore company administrator or facilitator. The mail will be put into a plain envelope and mailed to the address of the beneficial owner’s choice. Only the domestic return address and the recipient’s address appear on the envelope and there are no signs that in contains mail sent to the offshore company. Almost all offshore company providers give the possibility to have an offshore mail forwarding address for the offshore company.

Fiduciary

A fiduciary is someone who has undertaken to act for and on behalf of another in a particular matter in circumstances which give rise to a relationship of trust and confidence. A fiduciary is expected to be extremely loyal to the person to whom he owes the duty, who is often named as the “principal”. The fiduciary must not put his or her personal interests before the duty, and must not profit from his or her position as a fiduciary, unless the principal consents. The most common circumstance where a fiduciary duty will arise is between a trustee, whether real or juristic, and a beneficiary.

Letter of Wishes

A Letter of Wishes is a document that has no ‘real’ legal status. A Letter of Wishes is often used in connection with offshore trusts in order to transmit the wishes of the creator or the alleged owner of the trust to the trustee. It is a separate document and not a part of the trust instrument. Letters of wishes are generally used by the beneficial owner of the trust assets to retain some control over the trust assets. A Letter of Wishes enables a trustee to exercise his or her discretion having in mind the wishes of the grantor. The trustee may consider the letter but is not bound or otherwise accountable by its terms. In reality the letter of wishes will be honored as if it were a binding legal document.

Personal Investment Corporation (PIC)

A PIC, or Personal Investment Corporation, is a term used in the banking industry to refer to an International Business Company (IBC). PICs are generally created for the private bank’s client in order to hold the client’s investment assets.

Beneficial Ownership

Beneficial Ownership refers to the true owner of an offshore company or any other entity or asset, or transaction no matter what is stated in documents, public records etc. The beneficial owner is the one that receives or has the right to receive proceeds or other advantages as a result of the ownership. It is common practice when creating offshore solutions to interpose entities, individuals, or both as stated owners. The beneficial or true owner is contractually acknowledged in side agreements, statements or by other devises.

Tax Evasion

Tax evasion is the general term for efforts to not pay taxes by illegal means. This in contrast to the term tax avoidance which is used to describe actions that are within the law in order to minimize or avoid taxes. Tax evasion is in most jurisdictions regarded as a criminal behavior.

Tax Avoidance

Tax avoidance is the use of the tax regime to one’s own advantage within the rules of the law, to reduce the amount of tax that is payable. This is contrast to tax evasion which is a term used in order to describe a behavior to not pay taxes by illegal means.

Tax Haven

The term tax haven is not clearly defined and there is some discussion as to how the term should be defined. For being regarding as a tax haven it is not sufficient that a jurisdiction offers low taxes. The OECD has stated that the following factors should be decisive if a jurisdiction should be regarded as a tax haven:

• No or nominal taxes.
• Lack of transparency.
• Laws or administrative practices that prevent the effective exchange of information for tax purposes with other governments on taxpayers benefiting from the no or nominal taxation.
• Absence of a requirement that the activity be substantial.

Nominee Shareholder

A nominee shareholder is when the real or beneficial owner chooses not to have his or her name on the share certificate or in the share register. Instead another person agrees to appear on the share certificates and in the share register. In order to protect the real of beneficial owner the nominee should sign Declaration of Trust to the beneficial owner giving up any right to exercise any powers over the shares including voting rights or the right to sell or transfer the shares.

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