Showing posts with label credit. Show all posts
Showing posts with label credit. Show all posts

8/09/2009

Offshore is becoming future of bussines


A generation ago, when expatriate managers returned home, they unpacked their bags and stored their newly acquired global skills into a file cabinet.

After all, what use did the home office have for experience in an overseas satellite office? Now with global markets, organizations expect managers taking overseas postings to possess international experience before they head abroad. Personality becomes paramount, especially entering a country in which the manager has no first hand experience.

Personnel Decisions International surveyed managers in multiple countries to gauge the five personality traits judged to be most crucial to succeeding overseas. The traits of managers in various countries provided sharp contrasts. Western European countries such as Netherlands, Germany, and France are the most direct and unemotional, and place a lower priority on group harmony.

On the flip side, Saudi Arabia and Japan registered the highest level of concern for group harmony and sensitivity to words not expressed. Asian and European countries generally followed the pattern of their respective peers. Managers in China rated much more introverted than their counterparts elsewhere.

The purpose of the survey, according to Marc Sokol, senior vice president at Personnel Decisions International, is to highlight cultural differences to heighten awareness, not as a means to compare cultures. Such awareness builds empathy in managers as they navigate a new culture.

Given the wide range of personality traits necessary for success in overseas assignments, organizations need to provide an aggressive training regimen to teach employees the cultural dos and don'ts along with an immersive language environment Simply handing an employee a cultural "dummies" guide and a basic phrasebook for speaking with the locals won't be enough.

"The cost of failure is very high," says Sokol. "If you leave it to self- study, then you're rolling the dice."

To minimize risk, a lot of companies are choosing to send individuals overseas for shorter assignments, usually three to six months in duration. The employees do not bring their families with them and obviously do not sell their homes.

There is a four-stage process to acclimation with a foreign culture: awareness, empathy, bridging, and leveraging diversity.

While working in Britain for five years, Sokol had to learn the measure of understatement used by the British when speaking to co-workers. When a co-worker said he was "a bit frustrated," that indicated a high level of frustration and was a warning signal, not simply a conversation starter.

"It's like trying to explain what [Wizard of] Oz is," he says. "By our second year in London we were able to explain to others what life is like there without knowing everything."

Ironically enough, Sokol says that despite, and perhaps because of, the language similarity, the failure rate for expat employees in Britain is higher than in other countries where English is not the first language. A false sense of familiarity inhibits some expats from building networks quickly and overcoming initial cultural barriers.

Aside from diplomatic postings, Sokol says Royal Dutch Shell is a model organization for teaching employees how to get acclimated in a foreign country. Their managers receive deep immersion prior to placement overseas.

8/08/2009

What are offshore companies?


The term offshore company is ambiguous. It may refer to either:

A company which is incorporated outside the jurisdiction of its primary operations regardless of whether that jurisdiction of is an offshore financial centre (sometimes known as a non-resident company)i.e. a Canadian company may be 'offshore' for the purposes of a USA citizen ; or,

Any company (resident or otherwise) incorporated in an offshore financial centre

Typically the requirements for company registration under the relevant provision for non-resident status will be pursuant to some or all of the following criteria:

Must be incorporated from outside the jurisdiction in question;

Must not trade within the jurisdiction in question;

Must meet nominal tax expenses levied by the jurisdiction in question.


Benefits


Offshore companies have the following features which may be beneficial:

Taxation - In most jurisdictions authorities will not seek to tax companies which they treat a non-resident save perhaps for a nominal fee -$300 BVI, £320 Isle of Man etc.

Simplicity and Reporting - except for regulated businesses, such as banks or other financial institutions, some jurisdictions make it relatively simple to set up and maintain companies especially with reference to lesser reporting requirements than so-called onshore jurisdictions - the level of information required by the registrar of companies varies from jurisdiction to jurisdiction.

Legal and asset protection - some jurisdictions have stricter provisions for allowing a court to pierce the corporate veil, and in many cases, corporate governance rules require the laws of the jurisdiction where the corporation is chartered, rather than where it is sued, to apply. For example Gibraltar makes it illegal for the trustee of an Asset Protection Trust to surrender its assets to a creditor of the settlor and in Switzerland it is illegal to disclose banking information.

Fees - some jurisdictions impose much higher fees to incorporate than other jurisdictions. They may also impose much higher maintenance fees on a corporation's yearly renewal of its charter. This will vary from service provider to service provider and will be significantly based on the cost of local disbursements.

Anonymity - by carrying out transactions in the name of a private company, the name of the underlying principal may be kept out of documentation since the company is a separate legal entity. Having said that, current anti-money laundering regulations often require banks and other professionals to look through structures. This will always be the case for any reputable bank but this does not render ineffective the use of corporate structures, rather it ensures they remain legally compliant.

Thin capitalisation - Some offshore jurisdictions tend not to impose "thin capitalisation" rules on companies (except for regulated entities such as banks and insurance companies), allowing them to be formed with a purely nominal equity investment.

Financial assistance - offshore companies are usually not prohibited from providing "financial assistance" for the acquisition of their own shares, which avoids the needs for "whitewash" procedure in certain financial transactions.

Cost of operation - In many cases, i.e. where a self employment consultant provides service to a number of jurisdictions and is frequently travelling it is a matter of choice where he chooses to incorporate. In this case the fact that companies in an offshore financial centre are considerably cheaper than buying or renting premises, arranging to engage accountants, receptionists, IT providers etc would be.


Legitimate uses of offshore companies


International trading, especially there the owner has no fixed residence

Asset protection

Captive insurance

Yacht registration

Tax avoidance

Protection of intellectual property

Succession planning

Confidentiality (non-criminal)


Illegitimate uses


Financing of terrorism

Money laundering

Tax evasion

Fraud (including investor fraud and advance fee fraud)

Passing off

Confidentiality (for criminal activities)

Evasion of creditors