What procedures are required for investing and registering a company in Vanuatu?
The Vanuatu government welcomes foreign investment, but in order to protect the interests of domestic investors and implement foreign access policies, all foreign investors are required to apply to the Vanuatu Investment Promotion Authority (VIPA) before making investments. The committee will evaluate and approve whether the project is a restricted or prohibited investment behavior, the economic feasibility of the investment project, and the investor's creditworthiness, and make a decision on whether to issue a license within a maximum of 15 working days after receiving the application materials. The validity period of the foreign investment license is 12 months, and it needs to be renewed annually. Investors are required to pay the annual fee on time and comply with relevant regulations. The application fee for foreign investment project license is determined based on the investment scale.
Some industries in Vanuatu are not open to the outside world and are only open to Vanuatu nationals, such as exporting sandalwood, security services, commercial and cultural exhibitions, etc. Some industries have a high threshold and can only apply when their annual revenue reaches a certain amount, such as tourism, hotels, and construction.
The form of establishing an enterprise
There are generally three types of companies in Vanuatu, namely local companies, exempted companies, and international companies. Except for international companies, all other forms of companies are governed by the Company Law of Vanuatu. Local companies operate domestic business in Vanuatu, while international companies or exempted companies can engage in international trade. International companies can provide greater freedom and minimum restrictions, but exempted companies and international companies are not allowed to engage in trade within Vanuatu or hold real estate in that country. International companies are not allowed to engage in financial businesses such as banking, insurance, and fund management. Compared to previous exempted companies, international companies offer greater flexibility and simpler management. International companies do not need to submit the same documents as other types of companies, nor do they need to submit annual reports. However, they must submit detailed information about their registrant, registered office, and registered agent (valid passport copies, police clearance documents, proof of source of funds, etc.), as well as mortgage and charge on their property. The documents shall be submitted directly to the VFSC office in paper form. For specific business scope and characteristics of the above three companies, please visit the website of the Vanuatu Financial Services Commission (website: www.vfsc. vu/settingup. com).
The acceptance agency for registering enterprises
All companies engaged in commercial operations in Vanuatu must be registered in accordance with the provisions of the 1986 Company Law, and enterprises engaged in business activities must hold a business license. The regulations made by the Vanuatu government on investment behavior of investors include maintenance of public health and safety, environmental and building standards, etc. Among them, the three special regulations on investment are company registration, foreign investment permit, and business license. The Vanuatu Financial Services Commission is the government agency responsible for enterprise registration in Vanuatu. Foreign investment permits are issued by the Vanuatu Investment Promotion Commission, and business licenses are managed by the General Administration of Customs. The application sequence is company registration, foreign investment permit, and business license.
The main procedures for registering a company
When applying for registration, enterprises must provide the company's articles of association and name (the company name must not be the same or similar to the registered company name, nor should it contain words that may cause misunderstandings with any government). The language used for company documents is English. All companies must have a registered office within Vanuatu. According to the requirements of the Company Law, the nominal capital of exempted companies is generally $10000; There are no special requirements for the capital of international companies. Registered capital can be in any currency. In terms of the number of shareholders, local companies must have at least one shareholder, who can be either a natural person or a legal entity, and at least one director must be a resident of Vanuatu; International companies must have at least one shareholder, who can be either a natural person or a legal entity. Exempt companies require at least two shareholders and at least one director to be a resident of Vanuatu. The company may issue registered stocks, bearer stocks, preferred stocks, or stocks without voting rights. Although the financial statements of exempted companies and international companies do not need to be audited or submitted to any department, it is still necessary to prepare financial statements that reflect their financial situation sufficiently. The registration usually takes two working days. The business license is part of the company registration process. Enterprises are required to pay annual business license fees, which vary depending on the type of enterprise and turnover. As long as the annual fee is paid on time and the holder does not violate any relevant regulations, the license can be automatically renewed. For specific registration procedures, please visit the website of the Vanuatu Financial Services Commission (website: www.vfsc. vu/settingup. com).
All companies engaged in commercial operations in Vanuatu must register in accordance with the provisions of the 1986 Companies Act, and the Vanuatu Financial Services Commission is responsible for company registration. The registration fee varies depending on the nominal equity capital. Companies with a nominal equity capital of 35 million watts or less have a registration fee of 30000 watts, while companies with a nominal equity capital greater than 350 million watts have a registration fee of 250000 watts.
All enterprises engaged in business activities in Vanuatu must hold a business license. The business license is managed by the General Administration of Customs, and applying for a business license is part of the company registration process. As long as the annual fee is paid on time and the holder does not violate any relevant regulations, the license can be automatically renewed. Enterprises are required to pay annual business license fees, which vary depending on the type of enterprise and revenue
Commercial banks are required to pay a license fee equivalent to 7% of their net revenue, with a minimum license fee of not less than 5.5 million watts; Other professional service organizations (zero value-added tax) are required to pay a license fee equivalent to 5% of their revenue.
Financial trader license contact person: Hanson Moli, email: hmoli@vfsc.vu ; Michael Naviti, email: mnaviti@vfsc.vu .
How to apply for patents and register trademarks?
Applying for a patent
The Vanuatu Intellectual Property Office is responsible for processing patent applications, in accordance with the Patents Act No.2of 2003. When a company has a new invention or process that requires patent protection, it needs to apply for registration with the Intellectual Property Office, fill out the application form, and pay the application fee of 28000VT (the fee amount in July 2017 was 280 US dollars). Once the patent protection application is approved, the time limit is 20 years.
If you need more detailed information, you can directly consult with the Intellectual Property Office. Email: srailau@vanuatu.gov.vu .
registered trademark
The Vanuatu Intellectual Property Office is responsible for handling trademark registration applications, in accordance with TrademarksAct No.1 of 2003. Companies or individuals who apply for trademark registration for marks or markings used on products, services, or products and services shall fill out the application form. If there are no objections after 21 days of publication of the accepted trademark in the newspaper, the trademark registration shall be completed and the validity period of the trademark shall be 10 years. Within 3 months before the expiration, an extension of another 10 years may be applied for. The application fee is 25000 VT (as of July 2017, the fee was $250). If you need more detailed information, you can directly consult with the Intellectual Property Office. Email: bwayne@vanuatu.gov.vu .
What are the relevant procedures for tax declaration by enterprises in Vanuatu?
Vanuatu is considered a "tax haven" with main taxes including trade tax, value-added tax, and business license fees, without income tax, business tax, capital tax, real estate tax, inheritance tax, gift tax, and withholding tax. The trade tax mainly includes export tax (about 3% on average), import tax, wholesale and retail turnover tax (4%), and value-added tax (increased to 15% from January 1, 2018). Levy company registration fees, stamp duty, and ship registration fees, impose a 15% sales tax on restaurants and restaurants, and a 15% lease tax on property.
In May 2016, Vanuatu pledged to develop standards approved by the G20 and the Global Forum on Tax Intelligence Exchange and Transparency in accordance with the requirements of the Organization for Economic Cooperation and Development, and to carry out automatic exchange of financial account intelligence to combat tax evasion. At present, the Vanuatu government is considering revising its tax policy. The revised plan will mainly focus on income tax, including corporate income tax and personal income tax. The tax rate for corporate income tax is proposed to be 17%, and personal income tax is planned to be levied at a progressive tax rate:
1 wattage ≤ personal annual income ≤ 750000 wattage, with a tax rate of 0%, i.e. 750000 * 0%=0; 750001 watts ≤ personal annual income ≤ 3.5 million watts, and the tax rate for the portion of annual income exceeding 750000 watts is 10%, which is 750000 * 0%+(annual income -750000) * 10%; When an individual's annual income is ≥ 3500001 watts, the tax rate for the portion exceeding 750000 watts but less than or equal to 3.5 million watts is 10%, and the tax rate for the portion exceeding 3.5 million watts is 17%, which is 750000 * 0%+3.5 million * 10%+(annual income -3.5 million) * 17%.
The revised plan also considers abolishing rent tax, business license fees (related to business activities), business tax, reducing VIPA approval fees, work visa and residence visa fees, and lowering import tariffs, stamp duty, offshore company registration fees, and domestic company registration fees. As of June 2019, the revised plan has not yet been reviewed and approved.
Tax filing time
Vanuatu Value Added Tax Declaration: If the annual turnover is below $80000, the enterprise can choose to declare it monthly or every three months; Enterprises with an annual turnover of over 80000 US dollars must declare once a month. The monthly tax declaration must be completed before the 27th of the following month.
Tax reporting channels
Enterprises can declare value-added tax themselves or through accounting firms.
Tax declaration procedures
Regarding value-added tax declaration, it is necessary to fill out the tax declaration form prepared by the Value Added Tax (VAT) office within the tax payment deadline and proactively declare to the tax authority. During the first tax filing, the office will dispatch a dedicated person in charge to provide guidance and ensure that taxpayers can correctly fill out their tax forms.
Tax declaration materials
Value added tax declaration materials must include account books, receipts, tax invoices, checkbooks, bank statements, etc. At the beginning of each year, the customs will audit the company's accounts. The specific tax declaration procedures can be consulted with the tax authorities in Vanuatu.