FAQ
Frequently Asked Questions
Smart Company (SC)
A Smart Company (SC) is a form of organization that has been incorporated onto the Blockchain Technology with full legal compliance. Compared to traditional offshore business types, a Smart Company is a hybrid model of an International Business Company (IBC) and a Decentralized Autonomous Organization (DAO). The Smart Company model is suitable and versatile enough to be adapted to onshore business types as well, such as private limited and public companies.
While a DAO is only registered on the Blockchain and legally incorporated as a juristic person, a SC is registered with the chamber of commerce or company register of the respective jurisdiction, and incorporated with full legal personality as well as legal liabilities. In other words, a Smart Company is a compliant entity with legal personality, yet also benefits from the advantages of Blockchain technology such as speed, security and transparency. Smart Company shares are registered as tokens on the Blockchain.
See ‘Smart Company Shares’.
We operate a fully compliant model that we have successfully deployed in the jurisdictions where we operate. The legal framework around Smart Companies are the same of International Business Corporations (IBCs), LLC or Private Limited companies. See ‘Jurisdiction’
The shares of an incorporated Smart Company will be registered on the Blockchain as unique Ethereum ERC-20 Tokens modified in order to comply with security laws. These tokens carry information that makes them unique to each organization and tracks the history of their movements, without interfering with the legal validity of the share.
As corporate functionalities can be managed via Blockchain, which is immutable and difficult to hack, changes made to the shareholding of a SC through the Blockchain do not require endorsement, replication or action by admin or middlemen such as company secretaries or other officers, except as per current legal requirements.
Smart contracts are self-executing, self-enforcing contracts. Governed by explicit terms and conditions written as software programme, they can facilitate any field that uses data to drive legal transactions.
For Smart Companies (SC), these virtual agreements that govern the ERC-20 tokens as corporate shares can facilitate the transfer and governance of anything of value such as money, securities, shares, property and other assets.
Assets of an incorporated Smart Company are registered as they would be in traditional ways, owned by the Smart Company. Smart Company shares that own these assets, however, are recognized as Ethereum ERC-20 Tokens modified in order to comply with security laws. See ‘Smart Company Shares’. Tokenized corporate shares means that all transactions and trading of ownership happens on Ethereum Blockchain in immutable and verifiable ways, enabling accurate and real-time shares transfers. Subsequently, this indirectly unlocks the potential of all illiquid assets owned by the Smart Company.
Smart Companies can be managed directly via a dApp (Decentralized Application), where everything from ownership structures, shares and voting can be operated directly with all relevant stakeholders. All transactions happen on the Blockchain, so each movement is transparent to those with the access and technically resilient. Changes, modifications and shares transfers can happen as often as you’d like.
Jurisdictions
The law that governs all International Business Companies incorporations is the Seychelles IBC Act, which allows all International Business Companies (IBC) to be legally exempt from taxes and duties on all foreign source income and profits. As Smart Companies (SC) are legally recognized as an IBC, same advantages and limitations apply. In other words, IBCs and SCs are subject to 0% corporate income tax, as long as they do not conduct business or are fiscally resident within the borders of Seychelles. Furthermore, non resident IBCs are not subject to taxation on royalties and dividends received or sent abroad.
However, it is important to comply with the basic rules of an IBC in the Seychelles, which restricts an IBC from conducting business onshore, owning property or real estate in the Seychelles and operate certain businesses without appropriate licences. It is also important to remember that while Seychelles IBCs and SCs are not to subject to Seychelles corporate tax, foreign individuals may be subject to taxes in their home countries in accordance with their domestic tax regulations.
No minimum paid-up capital required. Minimum one shareholder and one director to incorporate in Seychelles.
Panama Smart Companies fall under the governing law of Panama Corporate Law. Legally, a Smart Company is recognized as a Panama International Business Company (IBC) with same advantages and limitations. IBCs are legally exempt from taxes and duties on all foreign source corporate income and profits. Panama is considered one of the more established jurisdictions in regards of identity and financial privacy with a robust set of banking options.
No minimum share capital required. Minimum 3 Directors required to incorporate in Panama.
Smart Companies in St. Vincent and the Granadines are governed by the International Business Company Act 2007, the same law as Panama International Business Companies (IBC). St. Vincent IBCs are legally exempt from taxes and duties on all foreign source corporate income and profits.
No minimum share capital required. Minimum one shareholder and one director to incorporate in St. Vincent.
Wyoming Smart Companies are legally recognized as Wyoming Limited Liability Companies (LLC or LLC Series). LLC is one of the lightest structures of a legal entity in United States and protects its shareholders from personal liability on debts and losses beyond the amount of capital put into the entity.
Wyoming LLCs are subject to 0% state tax on assets and income generated outside of the state of Wyoming. However, Federal tax may still apply to shareholders if profits are generated within the US borders. There is no separate tax levied on the LLC itself, therefore LLC’s profits/losses are generally passed on to the shareholders as they are considered personal income.
No minimum share capital required. Minimum one shareholder and one director to incorporate in Wyoming.
Singapore Smart Companies are governed by the same law as Private Limited Companies (Pte. Ltd.), which is also the most common and versatile legal entities in the jurisdiction.
A Private Limited Company is limited by shares and a separate entity from its shareholders. This structure is recognized as a taxable entity in its own right. As a result, shareholders of a Private Limited Company in Singapore are not liable for its debts and losses beyond their amount of share capital.
Minimum S$1 paid-up capital required. Minimum one shareholder, one resident director and company secretary to incorporate in Singapore.
My incorporation process
Incorporating a Smart Company (SC) with us can be done at one go. You need an internet connection and required documents ready. We have a partnership network that allows you to sign in our platform, add your digital identity and run Know-Your-Customer (KYC) / Anti-Money-Laundering (AML) directly with one click.
Our incorporation form is also online, which means your whole SC incorporation submission can be done as fast as you type.
Step 1. Open REQUEST INCORPORATION FORM and fill in all required information
Step 2. Invoice and Payment
Step 3. Review all information and a round of signatures
Step 4. Smart Company Ownership registered
1) Proof of Residential Address of Initial Director(s)
2) Copy of Passport
3) Linkedin Profile or CV
Step 1. Sign in here: https://korporatio.com/blockpass/
Step 2. Scan the QR code to log in
Step 3. Confirm
Smart Company (SC) ownership will be officially transferred to you, as the initial director of the company, after all submitted information is approved by the Registrar and payment collected.
Currently we can help with 4 options to open a bank account:
1. TransferWise
2. ePayments
3. Mr. Tango
4. Bank account in the specific jurisdiction
Each of these options have different requirements and costs. The most popular options for our clients are TransferWise and ePayments with a borderless bank account.
For instance, you can open a bank account in Seychelles regardless of where business operations are happening. If the currency is EU, AUD or DBP, Transferwise will directly register your Smart Company with the company name. If the account is in USD, the company name would be ‘Smart Company Name X USD Inc.’
If you have further questions about this, jump in the live chat on our website and we will be able to help immediately!
Payment
We accept bank transfers in EUR and USD. We are working hard to open payments via credit and debit cards so stay tuned for updates.