Cook Islands *
Foundation
The Cook Islands, located in the South Pacific, offers a sophisticated legal framework for asset protection and wealth management through the use of foundations. Governed by the Foundations Act 2012, Cook Islands foundations serve as a hybrid legal structure combining elements of trusts and corporations. These entities are commonly used for succession planning, charitable purposes, and asset protection, particularly in cross-border contexts.
A foundation established under Cook Islands law is a distinct legal entity with its own juridical personality. It is capable of owning property, entering contracts, and engaging in legal proceedings in its own name. The foundation’s assets are legally separate from those of its Founder, council members, Protector (if any), and Beneficiaries. This separation creates an independent patrimony, which is insulated from claims against these individuals or entities.
Foundations may be established for the benefit of persons or class of persons (beneficiaries), or for charitable, philanthropic, or mixed purposes, providing flexibility in structuring long-term or socially driven goals.
There is no minimum capital requirement to establish a Cook Islands foundation. Foundations may be created with a nominal endowment, often as low as USD 1, as long as there is a documented intention to contribute assets. This makes the structure accessible while maintaining legal formality.
Key Participants
Founder
The Founder is the individual or legal person who establishes the foundation by executing the Foundation Instrument. The Founder may be of any nationality or residency and may be a natural or legal person, including another foundation or company. There may be more than one Founder, and the Founder may act through a nominee.
The Founder has broad discretion to reserve certain powers in the governing documents, including the ability to amend the foundation’s purpose, appoint or remove council members or beneficiaries, or dissolve the foundation. These rights may also be assigned to other parties during or after establishment.
Foundation Council
The council is the administrative body of the foundation and is responsible for managing its affairs and executing its purpose. The law requires at least one councillor, who may be a natural person or legal entity, without restriction as to nationality or residence.
Protector
The appointment of a Protector is optional and must be authorized in the foundation’s governing documents. If designated, the Protector may be granted specific powers such as veto rights, amendment of the Rules or Instruments, or authority to appoint and remove council members.
Beneficiaries
A Cook Islands foundation may be established with or without designated Beneficiaries. Beneficiaries may include natural persons or legal entities and may be added or removed according to the foundation’s governing documents. Their rights and entitlements—if any—are determined by the Charter or Regulations. Importantly, Cook Islands law does not grant Beneficiaries automatic rights to information or entitlements unless explicitly conferred by the governing documents.
Governing Documents
Cook Islands foundations are governed by two main documents:
- Instrument: This is the publicly registered document and serves as the foundation’s constitutional instrument. It outlines the foundation’s name, purpose, initial endowment, and governance structure.
Rules: These are the internal rules that may govern matters such as asset distribution, beneficiary appointments, succession planning, and reserved powers.
The Cook Islands foundation is a robust legal structure that provides a high degree of flexibility in governance and asset protection. Its statutory separation of assets, lack of minimum capital requirements, and confidentiality features make it particularly suitable for estate planning, philanthropy, and holding passive investments. While the regulatory framework ensures transparency and accountability, it avoids burdensome public disclosure requirements, maintaining a balance between oversight and privacy.
Legal *
Country code – CK
Legal basis – Common law
Legal framework – Foundations Act
Regulatory board - Financial Supervisory Commission
Entity – Foundation.
Liability - A Cook Islands foundation is a distinct legal entity, separate from its Founder, members of the Foundation Council, any appointed Protector, and the Beneficiaries. The assets contributed to the foundation constitute an independent legal patrimony, which is not subject to claims against the personal assets of any associated party, assuming the structure has been lawfully established and administered.
Patrimony – There is no stipulated minimum contribution required to establish a Cook Islands foundation. In principle, a nominal initial endowment (for instance, USD 1) is sufficient to effect legal establishment, provided the intent to contribute further assets is documented in the Foundation’s Charter or Regulations.
Founder - The Founder is the person or legal entity who establishes the foundation through the execution of its Foundation Instrument. The Founder may be of any nationality or residency, and may be a natural person or a legal entity, including another foundation or corporate structure. More than one Founder may be designated.
Certain rights may be reserved by the Founder in the governing documents, such as the power to appoint or remove beneficiaries or council members, amend the foundation’s governing documents, or dissolve the entity. These reserved powers may also be assigned to third parties, either upon formation or at a later stage.
The Founder is permitted to be among the Beneficiaries.
Foundation Council – The Foundation Council is responsible for the administration and management of the foundation’s affairs and property. At least one council member is required. Council members may be individuals or legal entities, and there are no nationality or residency restrictions.
The Founder may serve as a council member.
Council members can be named in either the public Charter or the private Regulations.
Protector – The role of the Protector is optional and may be included if provided for in the Instrument or Rules. The Protector may be given specific powers such as veto rights, the power to appoint or remove council members, amend governing documents, or dissolve the foundation, among others. These powers are typically assigned by the Founder.
A Protector may also be a Founder, councillor, or Beneficiary.
Beneficiaries – A Cook Islands foundation may be established either with or without named Beneficiaries. The flexibility of the legal framework allows Beneficiaries to be appointed at any time, either by the Founder, the Foundation Council, or the Protector, subject to the provisions in the Instrument or the Rules.
Beneficiaries may include individuals and legal entities, regardless of their nationality or residency. Their entitlements and rights are defined in the foundation’s private Regulations or the Charter. There is no legal requirement for a Beneficiary to be notified of their status unless specifically stated in the governing documents.
Beneficiaries' Right to Information - The rights of the beneficiaries are set down in the charter or the regulations. There are no specific requirements.
Registered Agent – Foundations must maintain a registered office in the Cook Islands and appoint a licensed registered agent, who serves as the foundation’s official point of contact with the Financial Supervisory Commission. The agent is responsible for filing statutory documents and ensuring compliance with local regulatory obligations.
Instrument - The Foundation Instrument is the principal public document and serves as the foundation’s constitutional instrument. It includes key information such as the foundation’s name (or number), purposes, governance framework, and founder details. It must be filed with the Registrar.
Rules - The Foundation Rules is the documents that set out further detail regarding management processes, appointment and rights of Beneficiaries and Protectors, and the procedures for asset distribution, as well as other governance matters.
General Meeting – There is no statutory obligation for the Foundation Council to hold annual general meetings. Where meetings are held, they may take place anywhere in the world, including via remote means such as video conference. Written resolutions may be signed in counterparts and across jurisdictions, retaining full legal effect.
Re-domiciliation – The Cook Islands permits inbound and outbound re-domiciliation of foundations. This flexibility allows foreign foundations to migrate into the Cook Islands jurisdiction, and likewise, Cook Islands foundations may transfer their domicile to another jurisdiction, subject to statutory compliance.
Charitable/Philanthropic Purposes - Permitted.
Electronic Signature – Allowed.
Compliance – Foundations must pay an annual government fee payable to the Financial Supervisory Commission.
Foundations are required to retain accounting records for at least seven years from the date of the underlying transactions. Copies of such records must be maintained at the registered office in the Cook Islands or be readily accessible there.
There is no requirement for financial statements to be audited or submitted to the regulator, unless stipulated by the foundation’s governing documents.
- Corporate founder permitted * *
- Corporate council members permitted * *
- Protector/Guardian required * *
- Local regulated person required * *
- Founder not disclosed in a public registry * *
- Council members not disclosed in a public registry * *
- Protector/Guardian not disclosed in a public registry * *
- Beneficiaries not disclosed in a public registry * *
- Beneficiaries have right to information * *
- Merge permitted * *
- Redomiciliation permitted * *
- Charitable purposes permitted * *
- Registered agent required * *
- Common law Legal basis *
- - Initial endowment of assets *
- 1 Minimum council members *
Taxes *
Cook Islands offshore foundations are not subject to local taxation on income or capital gains, provided that their activities are conducted outside the Cook Islands and they do not engage in business with residents of the jurisdiction. Under the Foundations Act, these entities benefit from an exemption from taxes. Foundations are also exempt from stamp duties, withholding taxes, and estate or inheritance taxes under Cook Islands law.
- Offshore Income Tax Exemption * *
- Offshore capital gains tax exemption * *
- Offshore dividends tax exemption * *
- CFC Rules * *
- Thin Capitalisation Rules * *
- Patent Box * *
- Tax Incentives & Credits * *
- Property Tax * *
- Wealth tax * *
- Estate inheritance tax * *
- Transfer tax * *
- Capital duties * *
- 0% Offshore Income Tax Rate *
- 0% Corporate Tax Rate *
- 0% Capital Gains Tax Rate *
- 0% Dividends Received *
- 0% Dividends Withholding Tax Rate *
- 0% Interests Withholding Tax Rate *
- 0% Royalties Withholding Tax Rate *
- 30% Personal Income Tax Rate *
- 12.5% VAT Rate *
- 20 Tax Treaties *
Country details *
The Cook Islands is an archipelago of fifteen small islands, located in the South Pacific Ocean, between Hawaii and New Zealand. It is a member of the Commonwealth and it is freely associated with New Zealand. Cook Islands citizens are also New Zealand citizens.
The islands have a combined area of 236 sq. km, but the Exclusive Economic Zone occupies more than 1,800,000 square kilometers of ocean.
It is populated by about 21,000 inhabitants. Most of them living in Rarotonga Island, where is found its capital Avarua and its international airport.
Its official languages are the Cook Islands Māori and English. Its official currency is the Cook Islands dollar and the New Zealand dollar, the first pegged to the second.
The Cook Islands is a dependency with a representative parliamentary democracy, where the Chief Minister is the Head of State. The islands are self-governing in free association with New Zealand and are fully responsible for internal affairs. New Zealand retains some external affairs responsibilities, in consultation with the Cook Islands.
Its economy, like other South Pacific islands economies, is hampered by its isolation, lack of exploitable natural resources, a natural disaster-prone location, and poor infrastructure. Tourism is the main source of income and, to a lesser extent, the cultivation of tropical fruits and their processing, manufacture of clothing and handicrafts.
In addition to tourism, the other main economic sector is the offshore industry. The Cook Islands has attractive legislation that makes it possible to set up tax-free international companies, offshore banks, insurance companies, and asset protection trusts.