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Seychelles’s compliance assessment rating has dropped from “basic compliance” to “partial compliance” during OECD's 2020 review. In response to this, the Seychelles authority has promulgated the International Business Companies (Amendment) Act 2021 this August.
We outline below some key highlights:
1. Clause 175 amendment stipulated that companies have to keep their financial records in Seychelles which allow inspection by Financial Services Authorities (FSA). 2. Clause 169 (a) requires companies to keep information about all transactions for at least seven years, even if the company has been dissolved or revoked.
New accounting record obligation under the amendments significantly increased accounting record keeping requirements for Seychelles entities, including International Business Companies (IBC).
Previously, the law allowed entities such as IBC to keep their accounting records outside Seychelles, and customers only had to sign annual return to cobfirm details every year. IBCs now have to ensure that its relevant accounting records are kept in its registered office in Seychelles, including historical records dated back to the 7 years before 31 December 2021, that is, all accounting records since 1 January, 2015. The records must be submitted to the registered office in Seychelles before the deadline of 6 February 2022.
In addition, the following requirements will apply in 2022 :
1. Submit accounting records to the registered office every six months (Clause 175(1A) and (1B) of the Amendment Act)
All companies on the register must submit and keep their accounting records in their registered office in Seychelles every six months.
2. Both large companies and non-holding companies need to prepare annual financial summaries (Article 175(1B) of the Amendment Law).
Large companies (ie, annual turnover of more than 50,000,000 Seychelles rupee (SCR)) or non-holding companies (ie companies that not only hold equity or assets in other companies), have to prepare financial summary within 6 months after end of the financial year and the summary has to be kept at its registered office in Seychelles.
Please note that the above amendments were introduced in accordance with the recommendations of international organizations (such as the OECD).
The Seychelles government believes that this will help Seychelles to be removed from the current blacklist. We expect that the Seychelles government will issue relevant guidelines for the revised law shortly.
The Seychelles government has also passed amendment for foundations, limited partnerships and trusts which require to keep accounting records at their registered office or Seychelles trustee’s office for at least 7 years from the transaction date.
Action needed We recommend you should take immediate action and start to prepare accounting records from 1 January 2015.
Spot check will be conducted the Seychelles authority. Non-compliance will result in penalties and huge fines, ranging from US$2,000 to US$10,000 for each violation.
Whatsapp : (852) 6499 4686 Phone : (852) 2186 6936 Email : info@intershores.hk
Disclaimer: Whilst reasonable care has been taken in provision of information above, it does not constitute legal or other professional advice. INTERSHORES does not accept any responsibility, legal or otherwise, for any error omission and accepts no responsibility for any financial or other loss or damage that may result from its use. In particular, readers are advised to take appropriate professional advice before committing themselves to any involvement in jurisdictions, vehicles or practice.
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