Company not in Good Standing
Your company should be in Good Standing with the Companies Registry at all times, a company is deemed not to be in Good Standing if it is in breach of filings requirements.
Non-payment of annual government fees will make your offshore company lose its status of Good Standing and the company incur late penalty fees and potential legal consequences.
To remain in Good Standing your company needs to up to date with its filings, annual registration fees and requirements under the Companies Act. The register of directors and shareholders has to be properly maintained by the registered agent.
We provide registered agent and registered office services and can assist our clients with the required filings to ensure companies remain compliant and in Good Standing.
Loss of Good Standing Will Damage Your Ability to Do Business
All companies should be aware the consequences that losing Good Standing status can have, including the following –
- Difficulties in Securing Capital and Financing – Most lenders view a loss of Good Standing as an increased risk
- Loss of Name Rights – Once an entity loses its Good Standing status, it risks losing the right to use its name, other companies may be able to acquire the rights to its name
- Administrative Dissolution or Revocation – In a situation in which a business repeatedly fails to respond to requests for required filings, the company can be administratively dissolved
- Fines and Penalties – Fines and penalties on companies that don’t comply with the requirements that led to the loss of Good Standing
- Personal Liability – In addition to fines and penalties levied on a company not in Good Standing, some countries also hold individuals personally liable for conducting business on behalf of a company
An IBC, which is struck-off the Registrar shall remain liable for unpaid fees and also remains liable to all its debts and obligations.
A struck-off company may not continue to trade or enter into any new transactions, and its directors, shareholders, may not enter into any transactions with the assets of the company. If they do, they will be personally liable for any debts or legal consequences resulting from such transactions.
Striking-off an International Business Company means that all its assets are frozen until the IBC is restored in Good Standing – or until legally wound-up.
Belize – Not in Good Standing
The non-payment of annual government fees will make your offshore company lose its status of Good Standing. The Belize Registrar of Companies will then add late penalties and then proceed to strike-off your company from the Registry, for non-payment of fees.
To restore your company:
- First we need to obtain a Company Search from the companies registry to obtain details of the latest filings, and establish what fees are owed to the companies registry.
- The companies registry also have a reinstatement fee which must also be paid.
- The registered agent of your company will also need to be paid any outstanding fees owed.
- We can then become your registered agent and ensure that your company is kept in Good Standing
In Belize the registry label your company as not active if, the government fee is not paid on time.
BVI – Not in Good Standing
The non-payment of annual Government fees will make your offshore company lose its status of Good Standing. The Registrar of Companies will then add late penalties and then proceed to strike-off your company from the Registry. In the BVI, the process of being struck off involves an administrative procedure, the name of a BVI company is removed from the Corporate Register by the Registrar.
Strike off does not relive a company from the payment of its annual fees or late payment penalties.
If your BVI company that has been administratively struck from the Register it is automatically dissolved 10 years after it was struck off, provided that it has not been restored to the Register in the meantime.
There are significant implications that arise if your BVI company is struck off, your company cannot deal with its property and it will not be possible for moneys in its bank account to be accessed, even to pay the debts of the company or to make a distribution to members.
Your BVI company will not legally be able to sell or pass title to its assets, property that a company had when it is dissolved is transferred to the ownership of the Crown.
To restore your BVI company:
- First we need to obtain a Company Search from the companies registry to obtain details of the latest filings, and establish what fees are owed to the companies registry
- The companies registry also have a reinstatement fee which must also be paid
- The registered agent of your company will also need to be paid any outstanding fees owed
- We can then become your registered agent and ensure that your company is kept in Good Standing
In the BVI the registry label your company as not active if, the government fee is not paid on time.
Once your BVI company has been dissolved it can only be restored to the Register by the Court which must first declare the dissolution of the company to be void. The application to Court can be made within a 10 year period following the dissolution of the company. After that, a dissolved company cannot be restored to the Register at all.
Cayman Islands – Not in Good Standing
Non-compliance with the requirement to file the Beneficial Ownership Register with the Registrar of Companies can result in –
- Your company being struck off the Companies Register; and
- Assets of your company can be vested with Government
- Further penalties
Marshall Islands – Not in Good Standing
Non-payment of annual government fees will make your Marshall Islands company lose its status of Good Standing. There is an Annual Maintenance Fee payable to the Registry which varies depending on the company type, there are no annual document filings.
Nevis – Not in Good Standing
All the outstanding fees to the current Registered Agent and also to the government fees including Renewal, penalty fees and Reinstatement fee will need to be paid. The company will also need to be renewed with the Nevis Financial Services to bring the company back into Good Standing. Upon confirmation from the current registered agent that all fees have been paid a Certificate of Good Standing could be provided.
Panama – Not in Good Standing
A Panama company will have a company status of Not in Good Standing if the Registered Office is not effective, the company has no Registered Agent. The Annual Franchise Tax/ Tasa Unica Anual must be paid by all Panamanian and Foreign Corporations registered at the Public Registry Office of Panama to remain in Good Standing.
The Panama public registration law automatically dissolves any company that owes annual corporation tax for a period of more than 10 years. Provided permission is granted and note is added to the company file, the company can be granted a period of 3 years to pay back taxes.
Seychelles – Not in Good Standing
Non-payment of annual government fees will make the Seychelles company lose its status of Good Standing.
The Seychelles Registrar can also strike a company off the Register for the following reasons:
- The company no longer satisfies the requirements of the Companies Act for an International Business Company
- The Seychelles company fails to comply with a request for information from the Seychelles Revenue Commission
- The company fails to pay any penalty imposed by the Registrar under the Act
- The company conducts business or other activities which are, or are likely to be, contrary to the written laws of Seychelles or detrimental to the reputation of Seychelles
The company is deemed to be dissolved after 10 years of being struck off.
Singapore – Not in Good Standing
When a a Singapore company fails to hold its AGM or file Annual Return a penalty will be imposed for late lodgement as prescribed in the Companies Act, Cap 50. In addition, a summons may be issued against a company director for not holding the company’s Annual General Meeting and filing its Annual Return as stipulated under the law.
A Singapore company can be restored within 6 years after the company’s name has been struck off, by a Court Order. The Court Order must be lodged in Singapore via BizFile, the status of the company will be updated to live. Any director who has at least 3 of his Singapore companies struck off by ACRA, within a period of 5 years, will be disqualified from acting as director, or to take part in the management of any company for a period of 5 years commencing after the date on which the third company is struck off.
St Vincent & The Grenadines – Not in Good Standing
If an external St Vincent company fails to file an annual return, the Registrar may strike the company off the Register of Companies. In the event that a company is struck off, it may seek re-activation by filing the Articles of Restoration and paying restoration fee, however, before a company’s name can be restored to the register, past non-compliance must be remedied.
UK – Not in Good Standing
UK Companies House will only issue a Certificate of Good Standing if the company’s compliance statement and accounts are filed up to date.
If you submit company accounts late, the UK Companies Act imposes penalties. The level of the penalty depends on how late the accounts reach Companies House, failure to pay the late filing penalty will result in enforcement proceedings.
USA – Not in Good Standing
Failure for a USA company to maintain Good Standing is a compliance issue and will require prompt attention. Reasons why a USA company loses Good Standing status include:
- Failing to file annual reports on time
- Failing to maintain a registered agent or registered office in the State
- Failing to pay franchise taxes on time
In the USA a compliance failure can result in the administrative dissolution of your company and the loss of limited liability protections for the individuals involved.