Cook Islands: International Companies

A company can be incorporated under the International Companies Act 1981-82 ("The Act") as an international company if its shareholders are non-resident of the Cook Islands. A trustee company registered under the Trustee Companies Act 1981-82 may hold shares in an international company.

International companies –

• have no minimum capital requirements and shares may be of no par value ;
• may designate shares in most major currencies and may issue bearer shares ;
• need appoint only one director but there is no obligation to appoint a resident director ;
• must appoint a resident secretary who must be an officer of a registered trustee company. Additional non-resident secretaries may be appointed ;
• must lodge an Annual Return but are not required to file annual financial statements nor appoint an auditor nor hold an Annual General Meeting ;
• are not be subject to any form of taxation including stamp duty ;
• may be incorporated under foreign language names, e.g. Chinese, French, Japanese, German ;
• shall not carry on the business of banking or insurance, unless licensed under the relevant Act ;
• are subject to the secrecy provisions of the offshore legislation.

The Act incorporates a number of special provisions which provide considerable flexibility and unique benefits for offshore corporate structures. These include:

International companies may be listed on a number of major Stock Exchanges. The Cook Islands is one of three offshore jurisdictions approved for listing on the Hong Kong Stock Exchange.

The transfer of domicile provisions of the Act allow companies incorporated in other jurisdictions to transfer their registration to the Cook Islands to become international companies; and conversely for international companies to transfer their registration to other jurisdictions.

Companies limited by guarantee may be incorporated as well as no liability companies, unlimited companies, and mutual companies.

The Act provides considerable flexibility in regard to reduction of share capital. Specifically, the Act allows:

• a company to purchase and cancel its own shares.
• redemption of shares without maintenance of capital and without the need for a Court order.
• a company to finance the purchase of its own shares.

Various forms of debentures may be issued including bearer debentures, registered debentures, secured debentures and perpetual debentures. Where a bearer debenture is issued in circumstances specified by the Act, the rights of shareholders are suspended until such debenture is redeemed.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.