International Financial Services
Over the last decade, Seychelles has seen significant success in establishing itself as a well-known and respected international financial services jurisdiction. This journey started with the establishment of the International Business Companies Act in 1994, the International Trusts Act in 1994 and the International Trade Zone Act in 1995. Since then the Seychelles has swiftly been acknowledged by the global financial community as one of the most competitive and recognized jurisdictions for International business company incorporations.
Today, the financial services sector is said to be the most rapidly evolving sector of Seychelles’ economy with a growing assortment of financial products and services, substantial advancements in the competence and capabilities of the country’s human resource and a common understanding that success, growth and productivity can all be achieved whilst complying with an efficient and up-to-date legal and regulatory framework. One of the key factors leading to the country’s ascent onto the global financial services scene has been its success in implementing a legal framework that is sound, reliable and attractive to investors.
The Financial services sector is often referred to as the third pillar of the Seychelles’ economy and offers a range of services and products that make it such an exciting destination for Investment.
International business Companies (IBC)
IBCs are limited companies that carry out business activities outside of Seychelles. They are incorporated by the Registrar of International Business Companies which is the Financial Services Authority (FSA). These companies are created for conducting international business outside of Seychelles and are exempt from all forms of taxation. IBCs are ideal for a wide variety of uses such as holding companies, asset protection, patents and copyright holding companies.
Trusts set up under the International Trust Act 1994, provide an efficient, sensible and legitimate means of protecting your assets depending on your requirements. There are various purposes for trusts and these include property-holding trusts, charitable trusts or purpose trusts which are not used for the benefit of individuals, but for some specific purpose.
The Seychelles Foundation Act 2009 encompasses many of the best provisions found in other foundation jurisdictions yet provides more precision on essential legal issues in addition to more flexibility and better asset protection. The Seychelles Foundation is a separate entity, in that once the founder transfers assets to a foundation, those assets become the property of the foundation giving it full legal and beneficial title and no longer form part of the founder’s personal estate. Moreover, whilst its scope is limited to activities for which a Business License or professional qualification is not required, a foundation may still be the owner of securities, real estate and bank accounts and may enter into contracts of any kind that do not imply the practice of a commercial business.
Companies Special License (CSL)
The Seychelles CSL is a local tax resident company specially licensed under the Companies (Special Licences) Act, 2003 by the Financial Services Authority (FSA) and is subject to a tax rate of 1.5% of its worldwide (gross) income. It is incorporated as a domestic company under the Companies Act 1972 but awarded a special license by FSA which grants the company a special status as it benefits from access to the Seychelles’ growing network of Double Taxation Avoidance Agreements (DTAAs) and can also operate part of its business within Seychelles.
Protected Cell Companies (PCC)
Under the Protected Cell Companies Act, 2003 a company incorporated under the Companies Act 1972 can be authorized to divide into identifiable cells without having to assume a separate legal entity. Cells within a PCC are protected against liabilities incurred by cells of the same company making it an attractive solution for many business activities such as captive insurance or mutual funds businesses.
Limited Partnerships are registered under the Limited Partnership Act 2003 and are subject to the Seychelles Commercial Code. Under the Act limited partnerships must carry out its business activities outside the Seychelles andenjoysbenefits such as exemptions from:
- Stamp duty,
- Exchange Controls,
- Trades tax (custom duties) on capital goods for use in its office,
- Social security contributions,
- Work permit fees in respect of foreign employees
Mutual and Hedge Funds
Under the Mutual Fund and Hedge Fund Act 2008, Seychelles’ licensed funds may be administered in Seychelles or in a recognized jurisdiction and can be incorporated as a company, partnership or unit trust. Various types of mutual funds are available such as private funds, professional funds, and public funds. The Act also caters for exempt foreign funds which are funds licensed outside of Seychelles that may obtain authorization to be administered by a Seychelles licensed Fund Administrator. Funds offer increased diversification of investments, that is managed and administered by professionals, as well as the ability to participate in investments that is available to various classes of investors.
Securities industry related licences
The Seychelles securities market is governed by the Securities Act, 2007 and regulated by the Financial Services Authority (FSA). There are licences for various business activities that can be undertaken in the securities market; namely securities exchange licence, clearing agency licence, securities dealer licence and other related business.
There is one securities exchange in Seychelles: Trop-X (Seychelles) Ltd. Trop-X was incorporated in Seychelles in June 2011 as a private limited company and subsequently was issued a Securities Exchange licence in 2012. It launched a multi-asset, multi-currency modern financial exchange beginning with the launch of its three Equities Board in the 4th quarter of 2012 (i.e. Main Board, Small and Medium Enterprise Board and Venture Capital Board). From the first steps of the early days when only 1 company was listed on its Main Board and its total market capitalization was only USD 11 million, Trop-X has come a long way. As at April 2017, Trop-X has 10 listed stocks on its three equities board and a total market capitalization of USD 122 million. With an increase in the number of listings, total trade value increased tenfold compared to the early days. This was mainly attributed to local and international retail investors’ growing appetite in trading of local stocks. Trop-X currently has 2 active broker members; i.e. Constant Capital (Seychelles) and PKF Capital Markets (Seychelles) Ltd both located on Eden Island, Seychelles. Trop-X is since 2015, a member of the Committee of SADC Stock Exchanges (COSSE), African Securities Exchange (ASEA), an affiliate member of the World Federation of Exchanges (WFE) and recently joined the UN’s Sustainable Stock Exchanges (SSE) Initiative.
For more information on this exciting prospect please contact Trop-X (www.trop-x.com) at the following address:
Trop-X (Seychelles) Limited
Tel: +248 434 68 00
Since 2012, AfriClear Limited has been operating as a clearing agency for the clearing and settlement of securities on Trop-X and AfriDep Limited as a securities registry service for companies listed on Trop-X.
Other participants licensed under the Securities Act are securities dealers and investment advisors. As at April 2017, the Financial Services Authority has issued 10 securities dealer licences and 3 investment advisor licenses compared to 2 and 0 in 2012 respectively.
For more information on obtaining a securities dealer license or any other licences mentioned above, please visit the Financial Services Authority address on www.fsaseychelles.sc.
All insurance activities in Seychelles are licensed and regulated under the framework provided by the Insurance Act 2008. Seychelles encourages new entrant in the Insurance market and investors are welcome to set up Insurance and Reinsurance offices.