General Information

Multiple waves of colonizers, each speaking a distinct language, migrated to the New Hebrides in the millennia preceding European exploration in the 18th century. This settlement pattern accounts for the complex linguistic diversity found on the archipelago to this day. The British and French, who settled the New Hebrides in the 19th century, agreed in 1906 to an Anglo-French Condominium, which administered the islands until independence in 1980, when the new name of Vanuatu was adopted.

Vanuatu, an archipelago of 83 islands is situated in the South-western Pacific Ocean, about 1,750 kilometers east of Australia and 500 kilometers northeast of New Caledonia. The total land area is approx. 12,200 square kilometers and the territorial waters cover 450,000 square kilometers. Total population: more than 200,000 people. The capital is Port Vila situated on the island of Efate.

The republic was formerly known as the Anglo-French condominium of the New Hebrides. Multiple waves of colonizers, each speaking a distinct language, migrated to the New Hebrides in the millennia preceeding European exploration in the 18th century. This settlement pattern accounts for the complex linguistic diversity found on the archipelago to this day. The British and French, who settled the New Hebrides in the 19th century, agreed in 1906 to an Anglo-French Condominium, which administered the islands until independence in 1980, when the new name of Vanuatu was adopted.

A constitution was adopted and the Republic of Vanuatu came into effect. Vanuatu is a parliamentary democracy, the head of state being the president elected by an electoral college. The position is mainly titular and has very few executive powers. The legislature consists of a single chamber, a 52-member parliament, for which general elections are held every four years.

This South Pacific island economy is based primarily on small-scale agriculture, which provides a living for 65% of the population. Fishing, offshore financial services, and tourism, with more than 60,000 visitors in 2005, are other mainstays of the economy. Tax revenues come mainly from import duties. In response to foreign concerns, the government has promised to tighten regulation of its offshore financial center. In mid-2002 the government stepped up efforts to boost tourism through improved air connections, resort development, and cruise ship facilities.

The development of the offshore financial centre in 1971 added new dimensions to the economy and it now contributes considerably to Government revenue through the payment of annual registration fees for all companies, business licence fees, insurance, banking and trust company licence fees, stamp duties and other smaller fees. The offshore financial centre has also brought to the country increased employment opportunities, and an excellent infrastructure of telecommunications, banking, legal, accounting and other financial and commercial services.

The official languages are English, French and Bislama (pidgin). The language of the finance centre is predominantly English. The official currency is the Vatu. There are no exchange controls in Vanuatu. All major currencies can be deposited in Vanuatu and may be repatriated in the same currency or converted freely to most other currencies.

Vanuatu is a common law jurisdiction. Its constitution states that, until otherwise provided by parliament, pre-independence British laws shall continue to the extent that they are not expressly revoked or are incompatible with the independent status of the republic.

Vanuatu is still one of the places to obtain an offshore bank license although the establishment process has become more difficult. Please ask for details!

Company Information

The types of company for international trade and investment are: Exempt Company incorporated under the Companies Act (Cap 191) or the International Company "IC" incorporated under the International Companies Act 1992 (No. 32). The International Company provides for greater flexibility and minimal compliance.

The procedure to incorporate is quite easy, just one copy of the constitution is needed. Two copies of the Certificate of Incorporation are issued by the Vanuatu Financial Services Commission.

Any foreign investors planning to invest in Vanuatu ought to contact the Vanuatu Investment Promotion Authority (VIPA) first. VIPA's primary role is the promotion of Direct Foreign Investment into the Republic of Vanuatu and to provide a service to all foreign investors from initial inquiry to a project's operational stage and even beyond.

General information packages and advice on investment opportunities are provided as well as information on incentives and investment procedures in Vanuatu. VIPA is also empowered to facilitate business expansions and variations and to facilitate investors' requests for work permits, residence permits, business licences and other government approvals. No foreign investor is allowed to do any business in Vanuatu until an approval is given by the Vanuatu Government through the VIPA Board.

There are certain restrictions on trading: an International or Exempt Company may not trade within Vanuatu or own real estate there. An International Company may not undertake the business of banking, insurance, assurance, reinsurance, fund management, the management of collective investment schemes or the rendering of investment advice, or any other activity that would suggest an association with banking or insurance industries.

The powers (objects clauses) of an exempt company are contained in the Memorandum of Association, but are normally drafted to provide for general powers. An International Company has all the powers of a natural person and therefore can enter in to any lawful activity except as restricted by the International Companies Act.

The language of legislation and corporate documents is English. Foreign translations of corporate documents can be obtained for a fee. A registered office must be maintained in Vanuatu. Shelf companies are available, the time to incorporate is about two days.

Restrictions apply to identical names or names suggesting a connection with a government of another country or a public or international organisation or a municipal authority. Other names may be disallowed on policy grounds, as may those that are considered generally undesirable or obscene. An International Company name can be in any language and use that language's characters or alphabet e.g. Chinese, Japanese, Russian and Arabic.

The following names require consent or licence: Bank, buildings society, insurance, assurance, reinsurance, fund management, investment fund, trust, trustees, finance or their foreign language equivalents. The suffixes to denote limited liability are: an Exempt Company must have the word Limited in its name. An International Company may utilise a broad range of internationally accepted abbreviated words as suffixes to denote their limited liability.

Compliance

The standard authorised share capital for an Exempt Company is US$ 10,000. Most International Companies do not have an authorised capital as it is not required and the concept does not exist in the Act. Exempt and International Companies may have their capital expressed in any currency.

The following classes of shares are permitted: registered shares, bearer shares, preference shares, redeemable shares and voting or non voting shares. Domestic taxation is not payable on the net chargeable profits of Exempt and International Companies. There are no double taxation agreements.

An International Company pays the sum of US$ 300 per year. An Exempt Company pays a minimum sum of US$ 450 per year; this amount may increase if a company has a high authorised capital.

There is no requirement for an International Company to file accounts, nor for an Exempt Company to file accounts unless it is licensed. Both Exempt Companies and International Companies are required to keep accounts to present a true and fair view of the financial position of the company.

The minimum number of directors required for both Exempt and International Companies is one. The directors may be natural persons or bodies corporate, may be of any nationality and need not be resident in Vanuatu. An Exempt Company must appoint a company secretary. An International Company need not appoint a company secretary, although it is customary to do so to facilitate signing requirements. The minimum number of shareholders of an International Company is one. An Exempt Company requires two.