Asia’s largest company formation specialist targets Europe with new London office

Asia’s largest company formation specialist targets Europe with new London office

Asia’s largest corporate services specialist is aiming to secure a significant share of the UK and European market for company formations with the recent opening of a new office in Mayfair, London. Offshore Incorporations Limited (OIL) is a well-known and highly respected operation in Hong Kong and the Far East, having been operating there for over 25 years. The company has established an enviable reputation across intermediaries for both the wholesale supply of company formation services and an ability to deliver high quality technical support from a professional team of over 200 employees.

Martin Crawford, chief executive officer of OIL in Hong Kong, comments, “This is the first step in expanding OIL’s presence across Europe and it is an exciting milestone for the business, having just celebrated 25 years in Asia.  We wish to continue supporting our clients as they grow globally and require a wider variety of services for their offshore activities. You just need to look at the fact that over 50% of new properties in London are purchased by Asian investors to see the growth in demand for the kind of services we are able to offer internationally oriented clients.”

Users of offshore structures will now have easy access to fifteen separate jurisdictions, including well know locations such as Anguilla, Bahamas, British Virgin Islands, Cayman Islands, Delaware, Hong Kong, Mauritius, Samoa, Seychelles and Singapore, all from one central location. This marks a step change in the London and European markets in terms of the range of choice and solutions which are available. OIL’s house view is that the UK and European markets hold considerable potential in the need to support affluent Asian individuals and Asian based companies who increasingly require international structures to facilitate strong and consistent capital flows from Asia to Europe and as a result, it sees the Asian sector as offering considerable potential.

OIL’s research has highlighted other changes to business patterns too. Whilst historically jurisdictions such as the British Virgin Islands and Hong Kong have dominated incorporation numbers in pure volume terms, this pattern may now changing: The data suggests a trend away from jurisdictional choices which may have been partially driven by language, culture and time zones to a new model where the demand for new companies is emanating from within the jurisdiction itself. OIL believes this is driven partly by better regulation, but also by increased confidence in the supervisory and compliance environments which now exist in the premier jurisdictions.

In a bid to establish a unique identity for its new regional hub, OIL will be bringing its Hong Kong experience to bear when delivering after sales support. Detailed guidance on the company set up process, how long the incorporation could be expected to take and the existence of any bureaucratic idiosyncrasies are all aspects of the establishment process often overlooked when a shelf company is purchased, believes OIL. Day to day support too can be critical in ensuring the smooth running of a company, whether regarding matters such as document filing, supplying a company stamp (very important in areas such as the Middle East) or the provision of Certificates of Incumbency or Good Standing, documents which are often required to smooth the passage of lending or credit applications and annual auditing.

Tim Edwards, business development director of OIL in London comments, “Our Far Eastern experience tells us that many of our business partners are likely to appreciate support in the detailed aspects of day to day administration, where the true value of long term experience really can make a difference. Such support might be at a relatively obvious level such as advising on administrative and compliance protocols, but equally it is often the softer aspects which can only really be appreciated and understood from direct personal experience. This might come down to something as apparently simplistic as personal contacts and knowing how to work with local advisors to ensure documentation is prepared and filed in the appropriate manner to ensure the smooth running of a structure.”

One of the most obviously differentiating factors between jurisdictions is price – it can cost as little as $550 to establish a vehicle in the Seychelles, whilst at the other end of the spectrum, a Bermuda company costs from $15,500. With such a large variation in the fees associated with offshore structures, clients will want to know why they might be asked to invest more in one jurisdiction as opposed to another. The answer usually revolves around the purpose of the vehicle. Those jurisdictions offering lower cost solutions tend to be associated with simple trading or holding vehicles, whilst more complex structures such as fund vehicles, where both the regulatory and compliance requirements will be far more complex, are more often seen in jurisdictions such as the Cayman Islands and Bermuda, the latter also being a well know location for insurance services. Hedge funds, for example will often incorporate and list the Cayman Islands, as the jurisdiction has extensive experience in supervision and regulation in this area.

Tracking down the intermediaries who service these complex international markets is one of the tasks that Tim Edwards has set himself. OIL’s experience in Asia suggests that accountancy practices and the legal profession are the biggest consumers of company formations services. Typically buying in bulk, these organisations will hold batches of companies in stock to issue to clients as and when a specific business need arises. This could be anything from the purchase of a mansion block to the demerger of part of a business. However, Edwards is aware of new entrants into the wealth management market such as auction houses who increasingly are attempting to capture high net worth clients and exploit their earnings potential across a broader range of services. Other sectors on OIL’s radar include private banks, trust companies and family offices.

Going forward, as the UK and European markets for offshore corporate structures becomes more exposed to specialist offshore jurisdictions, it is the question of pre sales consultancy and post incorporation support which OIL believes will become ever more important in the highly competitive world of cross border corporate services.