Country code – VU
Legal Basis – Mixed (Common, French Civil and Customary law)
Legal framework – Foundation Act No. 38 of 2009
Regulatory board - Vanuatu Financial Services Commission
Entity – Foundation
Liability - A foundation has its own separate legal personality, the properties and resources of it constitute an independent patrimony from that of the Founders, the Foundation Council members, Protector and Beneficiaries.
Dedication of assets – Must have an initial endowment, irrevocably transferred by the founder within 6 months since its registration. The legislation doesn't stipulate a minimum capital sum however a description of the initial endowment must be included in the foundation's charter.
Founder – A person who acts for a founder or a foundation must hold a CTSP (Company and Trust Service Providers) license, provided by the Vanuatu Financial Services Commission.
Foundation Council – The business and affairs of a foundation are to be managed by a board of councilors consisting of one or more persons. A councilor may be an individual or a body corporate. The first councilors of a foundation may be appointed in the charter of the foundation, to take effect on the establishment of the foundation; or in any other manner provided by the charter or by-laws. The remuneration of councilors must be fixed in accordance with the charter and by-laws of the foundation. Councilors’ details are available to the public.
Secretary - The councilors of a foundation must appoint a secretary, who may be a natural person or a body corporate. Name and address of secretary are publicly available.
Guardian – A foundation must have a guardian. An individual or a body corporate may be appointed as guardian of a foundation.
If more than one person is appointed as guardian, the guardians must act unanimously unless the charter or bylaws of the foundation provide otherwise. The first guardian of a foundation may be appointed by the founder in the charter of the foundation, and the appointment has effect from the date of registration of the charter.
A councilor of a foundation may be appointed as guardian, but a sole councilor may not be appointed as the guardian.
Details of the Guardian are not publicly disclosed.
Beneficiaries – The beneficiaries have the right to confidentiality.
The Charter – The charter of a foundation must state: the name of the foundation; and the name and address of the founder; and if the founder is a body corporate, details of that body corporate’s incorporation; and the foundation’s registered office; and the purposes and objects of the foundation; and the nature and total amount of initial assets of the foundation; and the manner of designation of the beneficiaries or the manner in which the beneficiaries are to be ascertained; and whether the foundation is established for a definite or indefinite period and, where it is established for a definite period, that period; and the name and address in Vanuatu of the secretary to the foundation; and whether the foundation is a private or a public foundation.
The charter of a foundation may include provisions: that reserve the rights or powers to the founder; and about the appointment, removal, number, period of office and functions of the foundation’s councilors; and for the appointment, removal and period of office of the auditor, if any, of the foundation; and for the appointment and removal of a guardian and the guardian’s functions and remuneration; and for the appointment of persons to carry out particular duties on behalf of the foundation; and about amending the charter; and about making by-laws; and about transferring assets to the foundation, in addition to the initial assets; and for the addition or removal of beneficiaries.
By-laws - If the charter of a foundation provides that by-laws may be adopted, the by-laws may include provisions: about distribution of assets by the councillors of the foundation; and more specifically identifying any beneficiary, or additional beneficiaries, of the foundation; and about identifying the remaining beneficiary on the dissolution of the foundation; and setting out the proceedings of the councillors of the foundation.
Annual Meeting - The foundation must hold at least one meeting of the councillors in each year as its annual meeting, in addition to any other meetings in that year, and must specify the meeting as the annual meeting in the notices calling it. The founder and the guardian are not entitled to vote at a meeting.
A councillor of the foundation is taken to be present at a meeting of councillors if he or she participates by telephone or other electronic means, and all the councillors participating in the meeting are able to hear each other.
Re-domiciliation – An overseas foundation may apply to the Commissioner for a certificate of continuance in Vanuatu if the foundation would be able to be established as a foundation under the Foundation Act; and the application is not prohibited under the laws of the foundation’s jurisdiction.
A Vanuatu foundation may apply in another jurisdiction to be continued.
Mergers – A Vanuatu foundation may merge with another entity.
Charitable/Philanthropic Purposes - Permitted.
Compliance – A foundation must keep a register of its councillors, guardian and secretary at its registered office.
A foundation must keep proper accounts showing: all sums of money received, expended and distributed by the foundation and the purposes of the receipt, expenditure and distribution; and all sales and purchases by the foundation; and the assets and liabilities of the foundation.
The accounts of a foundation: must be kept at the registered office of the foundation or at another place in Vanuatu agreed by the councillors; and must at all times be available for inspection by the councillors, the guardian and the auditor; and may be kept in electronic form; and must be retained for 7 years from the date on which they are made.
The accounts of a public foundation must be audited by an auditor appointed by the councillors.
The accounts of a private foundation need not be audited unless this is required by the charter or by-laws.
A foundation must file an annual return with the Commissioner. The annual return must be filed before the end of the month after the month in which the anniversary of the foundation’s registration took place.
- 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
- Mixed (Customary, French civil and Common) Legal basis
- - Initial endowment of assets
- 1 Minimum council members
- 2018 AEOI
Vanuatu does not levy corporate and individual income taxes, no dividend distribution taxes, no capital gains taxes, no withholding taxes, no estate and inheritance taxes, and there are no foreign exchange controls.
The only applicable taxes are a value-added tax of 12.5%, stamp and custom duties, with certain exemptions in sectors such as Tourism, Manufacturing or processing and Mineral exploration.
- 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
- 0 Losses carryback (years)
- 0 Losses carryforward (years)
- 0% Personal Income Tax Rate
- 12.5% VAT Rate
- 14 Tax Treaties
The Republic of Vanuatu is a former English-French protectorate, made up by an archipelago of 83 islands of volcanic origin surrounded by coral reefs, covering more than 12,000 sq. km of the South Pacific Ocean. Located 1750 km from Australia, 500 km northeast of New Caledonia, west of Fiji and south of the Solomon Islands, near New Guinea.
The islands are inhabited by 267,000 inhabitants. Port Vila is the capital, the most populated city, and the economic and commercial center.
Port Vila is located in Efate Island (the third largest of the archipelago), which has the most important port and airport of the country.
Its official languages are Bislama, French, and English. Its official currency is the Vanuatu Vatu (VUV).
The government and politics of Vanuatu take place within the framework of a multi-party representative parliamentary democratic republic, in which the Prime Minister of Vanuatu is the head of government and the President of Vanuatu is the head of state.
The country is one of the most underdeveloped in the region, with a per capita income that barely reaches USD 3,000 annually and a very unequal distribution of wealth, with much of the population devoted to subsistence agriculture.
It has a fragile economy, with inherent economic difficulties, is remote and isolated, facing heavy transport costs, is prone to natural disasters and is heavily dependent on foreign investment, tourism and commodities price fluctuations.
Tourism is its largest sector, accounting for half of GDP. Agriculture and fisheries are the second largest, about a quarter of its economy. Its main exports are copra, coconut oil, kava, beef, timber, cocoa and coffee, and destined to Australia, New Zealand and Japan.
The Government plays an important role in the country’s economy. There are more than a dozen state-owned enterprises in such important economic areas as airports, banking, agriculture, and broadcasting.
Vanuatu has been an offshore financial center for more than 40 years. The sector contributes almost one-tenth of GDP. With well-developed banking and financial infrastructure, international financial institutions, professional lawyers, accountants and financial advisors, including multinational firms.
Tax treaties Map
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