How to covertly own a business and not lose control over it?
What forces modern entrepreneurs to covertly own their business? Can this weaken their ownership in the company? Are there any legal schemes when businessmen can, without advertising their persona, own a company?
Answers to these questions in our material.
1. Reasons for hidden business ownership.
There are actually many reasons for the hidden ownership of a business.
a) Raider captures. The dashing 90s are left behind and, it would seem, the raiding chaos should be forgotten. However, company invaders are still operating, with the support of corrupt officials, as is often the case. Representatives of government agencies “nightmare” business, and commercial organizations become easy prey for raiders. However, experienced lawyers can make your business unattractive to raiders.
b) Guarantees of protection of property of the business owner. Financial claims may come from creditors, business partners, family members, and government officials. Entrepreneurs often face these challenges. Each time they risk losing their property. And, in order to protect it, they prefer to hide their status as the owner of the company and their ownership of the company, assets.
c) Protection of the company and its property. To protect your business brainchild from possible financial risks, you can also turn to schemes that allow you to legally conduct business, leaving your person hidden from the register.
d) Job restrictions. Taking a position that does not allow you to freely manage your business is another reason why entrepreneurs try not to advertise their status.
e) Optimization of tax payments. The need for it more often arises in groups of companies. Optimization of taxes eliminates the interdependence of joint stock companies.
f) Reducing business risks. Namely, the protection of one direction of the company from the risks of another.
2. Ways of organizing hidden ownership.
It should be noted right away that there are a lot of combinations. Here are 5 tools.
Offshores and opportunities of foreign jurisdictions. This is without a doubt the most popular scheme for a particular category of entrepreneurs and consultants.
Etarchy. This method involves cross-ownership of the business, in which the two companies own each other.
Corporate agreement. This is a type of agreement that is concluded between the nominal and the real owner regarding the rights, obligations and possible actions of the nominal participant in managing the affairs of the company. This is a good way to preserve the integrity of the business and easily get out of “deadlocks”, to formulate convenient voting outcomes in advance.
Pledge of a share or shares. It allows you to assign all the rights of company participants to the recipient of income, according to the contract. Moreover, the beneficiary is hidden from the register.
Joint-stock company (non-public). Due to the peculiarities of maintaining the register and the lack of information from the register of shareholders in the public domain, it allows you to mitigate the risks associated with the participation of an individual in the capital of the company.
3. A few more tools.
3.1. Transfer during life: 1) alienation of a share, including with reverse alienation; 2) “rent” / “trust management” of shares; 3) “agent” schemes; 4) reorganization / creation of “daughters” / “granddaughters”; 5) inclusion in the management bodies / provision of positions; 6) options / “quasi” -options; 7) agreements on the alienation / provision of an asset in the future; 8) non-commercial / commercial legal entities; 9) joint ownership; 10) agreements between heirs on the use of common property; 11) transactions in favor of a third party; 12) corporate agreement.
3.2. Transmission after death: 1) will; 2) inheritance contract; 3) inheritance fund; 4) options; 5) transactions with execution after death; 6) joint wills of spouses.
To summarize, it is worth noting: you can not blindly apply any of the above schemes to your business. The template must be adapted specifically for your company. Then the organization of hidden ownership will be as efficient and safe as possible.
David Glikshtein, manager. I am writing articles, looking for interesting information and suggest ways of its practical use. I believe that thanks to high-quality legal analytics, clients come to a law firm, and not vice versa. Do you agree? Then let's be friends on Facebook.
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