Anguilla

Anguilla, a British Overseas Territory in the Eastern Caribbean, has emerged as a reputable and stable jurisdiction for international company formation. While sharing many features with other British Overseas Territories, such as regulatory alignment and legal predictability, Anguilla has maintained a relatively low profile in global regulatory discourse, making it a discreet yet effective destination for structuring international entities.

The territory’s legal and financial system is rooted in English common law, offering a familiar framework for legal practitioners and corporate service providers. Its corporate laws are modern and flexible, designed to meet the needs of both private individuals and institutional clients seeking efficiency, legal clarity, and regulatory simplicity.

The Limited Liability Company (LLC) in Anguilla is based on the U.S. model and functions as a hybrid legal entity. It combines attributes of both partnerships and corporations. Like corporations, LLCs in Anguilla have separate legal personality and offer limited liability protection to their members. At the same time, LLCs are managed under a contractual framework, similar to partnerships, allowing members considerable latitude to organize the internal affairs of the company according to their preferences.

Ownership in an LLC is represented by membership interests, rather than shares. This structural distinction permits more customized arrangements among members, including variations in voting rights, profit participation, and decision-making responsibilities. These elements are governed by the LLC Agreement, which serves as the foundational contract among the members.

Unlike companies limited by shares, LLCs are not subject to statutory governance requirements regarding directors, company secretaries, or mandatory meetings. The absence of formal corporate organs allows for more adaptable and informal management structures. Management can be centralized under a board of managers or delegated to specific individuals or entities, depending on what the LLC Agreement stipulates.

There is no minimum or maximum capital requirement, and contributions may take the form of cash, property, or services, subject to terms agreed by the members.

LLCs can be formed with a single member and are not subject to ongoing reporting obligations unless they are engaged in certain regulated activities or fall under the scope of economic substance requirements. There are no mandatory requirements to appoint auditors, maintain statutory books beyond a membership register, or file annual financial statements under general circumstances.

Furthermore, there are no residency requirements for members or managers, although companies engaging in regulated or substance-relevant activities may be subject to local presence requirements.

Anguilla is characterized by its tax-neutral regime, making it attractive for international structuring. The jurisdiction does not impose direct taxes, including income tax, corporate profit tax, capital gains tax, inheritance or estate tax, or withholding taxes, on either residents or non-residents.

This fiscal neutrality applies equally to individuals and corporate entities and is designed to support cross-border structuring, asset protection, and private wealth management activities. While Anguilla’s tax framework offers simplicity, companies operating internationally must still consider tax obligations in other jurisdictions, especially in light of global tax transparency standards.

In line with global initiatives to counter harmful tax practices—particularly those set forth by the OECD and the EU—Anguilla has enacted economic substance legislation applicable to entities engaged in certain business activities.

Entities that engage in the following “relevant activities” are subject to substance requirements:

• Banking
• Insurance
• Fund management
• Financing and leasing
• Headquarters operations
• Shipping
• Holding company activities
• Intellectual property (IP) business
• Distribution and service center operations

Companies conducting these activities are required to demonstrate adequate economic presence in Anguilla. This includes being managed and controlled from within the jurisdiction, maintaining sufficient physical office space, incurring relevant expenditures locally, and employing an adequate number of personnel appropriate to the scale and nature of the activity.

Entities deemed to be engaging in high-risk IP business face enhanced substance obligations. These include IP rights acquired from related parties and subsequently exploited through intra-group licensing arrangements or where the value of the IP is derived from activities conducted by affiliates. Such structures must provide detailed documentation substantiating development, maintenance, and exploitation of the IP from within Anguilla, or else face potential sanctions.

Conversely, pure holding entities, which only own equity participations and earn dividends or capital gains, are subject to a reduced substance test, requiring minimal local presence.

Entities within the scope of the substance regime must submit annual filings to Anguilla’s regulatory authority. These filings enable the jurisdiction to assess whether the entity has met its substance obligations. If an Anguilla LLC can prove that it is tax resident and substantively active in another jurisdiction, it may be exempt from local substance rules.

Anguilla’s LLC regime offers a modern, adaptable corporate vehicle suitable for a wide range of commercial, investment, and asset protection uses. Its combination of legal certainty, tax neutrality, and minimal administrative burden, together with contractual flexibility and compliance with international standards, makes it a viable jurisdiction for structuring cross-border business ventures.