The Isle of Man Treasury says that the Isle of Man Companies Act 2006 has become Law. The Act which marks the biggest change in Isle of Man Company Law for seventy-five years was approved by the Island’s Parliament, Tynwald, during the summer of 2006. Royal Assent was received on 14 October 2006.
The Act updates and modernises the Island’s Company Law, by introducing a new simplified corporate vehicle into Isle of Man Law. It is a development of the international business company (IBC) model, available in a number of other international business centres and is fully in line with recognised benchmarks. The new vehicle is introduced alongside previous Isle of Man Company Legislation. Companies formed under the 1931 Act may also convert to the 2006 version in the future if they wish to.
The initiative was led by Isle of Man Treasury and involved extensive consultation with the Isle of Man’s finance sector. The Act provides a streamlined process for setting up and running a company in the Isle of Man and complements the zero rate company tax strategy introduced in April 2006. This “corporate package” of legislation has been tailored for business, and has the flexibility to enable new applications of the corporate vehicle in line with future market developments.
The Act has been designed for a range of corporate transactions. It is likely to be particularly useful for public offerings, securitisations, asset and project finance. It will extend the already significant number of Isle of Man incorporations that are handled by the Island’s Law Firms and licensed Corporate Service Providers, both directly and on behalf of London based lawyers and brokers, in particular in connection with AIM admissions and the establishment of both open and closed-ended investment funds.
“When combined with the Isle of Man’s zero rate tax strategy and the existing benefits which the Island offers through our strong professional infrastructure, the new Act places the Island at the forefront of European domiciles for company structures and servicing,” says Allan Bell, the Treasury Minister of the Isle of Man.