The nominee director service may be used where a client doesn’t wish to be personally appointed or has to meet local requirements. The name of the director will appear in the corporate documents, in any business contract and in the jurisdiction’s business register.
Another advantage of using a nominee service is to place the “management and control” issue firmly outside a high tax jurisdiction. Upon appointment of a nominee director, a Nominee Director Agreement will be signed between the client and the nominee. It will guarantee the client that the nominee can only act or sign documents upon the client’s request and with the client’s prior approval.
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Frequently asked questions
What are nominee services?
In terms of the law, nominee services are a system of contractual arrangements between nominees (directors and shareholders) and actual owners (beneficial owners) of a company.
Nominee services are an optional service under which a person other than the real owner who effectively manages the company is appointed as a director at the time of incorporation or at a later date. The nominee director does not control the business of the company and only act on
the instructions of the owner.
When are nominees needed?
First of all, nominees are needed when the country of incorporation has a public register of shareholders and directors, on which you do not wish your name to be listed.
Appointment of a nominee is also an obvious choice where it is beneficial for the proposed business of the company, — for example, you need to demonstrate that the company is managed and controlled from the jurisdiction of its incorporation; or you intend to set up a branch in another country and are unwilling to act as director, etc.
What is a nominee director?
The nominee director is a person who manages a company’s affairs, but who does not perform these duties at his sole discretion. The nominee acts strictly on instruction from the beneficial owner with whom he is bound by contractual arrangements. If the owner so wishes, the nominee director may have broader powers, but the beneficial owner is still able, at any time, to cancel the decision of the nominee director.
At the end of this week we will write what are the roles and authorizations of a director. Stay tuned.
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