International Business Types
Regular Barbados Companies (RBCs) are generally incorporated under the Companies Act of Barbados and may only carry on international business with permission of the Central Bank of Barbados.
Societies with Restricted Liability (SRLs) are organised under the Societies with Restricted Liability Act and may only carry on international business with permission of the Central Bank of Barbados. The main difference between an RBC and an SRL is that an SRL may, under certain conditions, be treated as a disregarded entity for US tax purposes, and is therefore more often seen in cases where there are investors from the US.
International Business Companies (IBCs) are generally incorporated under the Companies Act of Barbados and must only carry on international business (i.e., generally cannot trade in Barbados).1 An IBC must apply to the Minister responsible for International Business to obtain an International Business Licence.
International Societies with Restricted Liability (ISRLs) are organised under the Societies with Restricted Liability Act (SRL Act) of Barbados and must also apply to the Minister responsible for International Business to obtain an International Business Licence. An ISRL may not acquire or hold land in Barbados, other than land required for its business held by way of lease or a tenancy agreement nor transact business with any Barbados residents. Like SRLs, ISRLs may be treated as disregarded entities for US tax purposes.
Exempt Insurance Companies (EICs) are generally incorporated under the Companies Act of Barbados and must apply for a licence under the Exempt Insurance Act (EIC Act). One of the requirements to qualify for an EIC licence is that the company’s object and activities are the transaction of “exempt insurance”. Exempt insurance is defined in the EIC Act as the business of insuring risks located outside Barbados in respect of which premiums originate outside Barbados, and includes the business of an underwriter, broker, agent, dealer or salesman in respect of that business.
Qualifying Insurance Companies (QICs) are generally incorporated under the Companies Act of Barbados, registered as insurers under the Insurance Act and must apply for a certificate to qualify as a QIC under the Insurance Act. One of the requirements to qualify as a QIC is that the company is a registered insurer in respect of which at least 90% of gross revenues from insurance premiums originate outside CARICOM and at least 90% of all risks insured originate outside CARICOM.
International Banks (IBs) are generally incorporated under the Companies Act and must apply for a licence to operate as an international bank under the International Financial Services Act. Such a licence is required to carry on any international financial service in or from within Barbados (subject to
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BUSINESS FACTS
Investing in Barbados
Non-national investors will need to submit an application for permission to invest in Barbados to the Exchange Control Authority (ECA). The functions of the ECA have been delegated to the Central Bank of Barbados and are carried out by the Foreign Exchange and Export Credits Department of the Bank.
The applications are usually submitted by the applicant or their professional advisor prior to the execution of the transaction contemplated, for permission "in principle". This permission is readily granted, especially if employment in Barbados will be created, but usually states that the permission is subject to the remittance to Barbados of foreign currency and that evidence of the remittance be submitted to the ECA. Once permission in principle is obtained the transaction is completed and evidence of the foreign remittance submitted to the ECA; the amount of foreign currency becomes registered with the ECA. The certificate of registration of these funds is an important document as it must be presented at any time in the future that the investment proceeds are to be repatriated from Barbados.
The investment vehicle or business in which the non-national has invested is treated as resident and all transactions in foreign currency will be subject to exchange control permission or guidelines under delegated authority to the commercial banks. In certain circumstances when a business earns foreign exchange a commercial bank may open a foreign currency account in Barbados for the business. The commercial bank is required to monitor the transactions on the account in accordance with the guidelines issued by the ECA from time to time and to submit information on the transactions.
Non-national investors or corporations controlled by non-nationals are generally required to finance their operations from sources external to Barbados. Where a significant project is being undertaken in Barbados that will create employment and foreign exchange earnings the ECA will consider applications for permission for financing arrangements that vary from the general requirement.
BECOME A MEMBER OF BIBA
Become a Member
The Barbados International Business Association (BIBA) is a not-for-profit private sector trade organisation. It provides a network for meetings and exchange amongst persons involved in international business. BIBA serves as a growing voice in the development of international business in Barbados and has over 170 member firms at this time.
FREQUENTLY ASKED QUESTIONS
What is the minimum capitalisation required for an international business company?
For an exempt insurance company the minimum capital requirement is US $125,000; for a company licensed under the International Financial Services Act: US $2 million for a company accepting third-party deposits; and US $500,00 for a company not accepting third-party deposits.
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