Shelf companies are legal businesses duly created but ones that remain dormant since their inception. They are also known as aged corporations or ready-made companies. These companies are intentionally put on the shelf so that they can attain a certain age. They remain on the shelf until a time when they get a buyer. Even though the company is unused, it still has to comply with the statutory requirements.
The company has to satisfy all the registration requirements before it can conduct business. Following the requirements will make it easy when doing business. The company must meet the following requirements:
- Local registration as a private limited company
- At least one local director
- Local company secretary
- Has more than one foreign or domestic directors
- A local registered address
Registration of the shelf company
The registration process of the shelf company is simple and follows the steps below.
- It must have an appropriate company structure
- Sign the contract of purchase
- Transfer the ownership
- Update the articles of association to comply with the Companies Act
- Submit the legal documents to the relevant authority
If you do not want to start a new company, you can buy a ready-made company. Purchasing the company takes a short time; you can complete the whole process in a few hours. You only need a sales contract and to pay the purchase price before using the company to start your business dealings. The transfer takes a shorter time once you have made the payments. Before you make the purchase, make sure you know the legal aspects and the appropriate type of business. Do a check on the economic background of the company. You can look for the shelf companies on sale before choosing the appropriate vendor to buy aged corporations. It is advisable to do a financial history check of the shelf company that you are looking to buy.
Once you have purchased the business, you have to make the relevant changes. It would help if you changed the articles of association and include the names of the new directors and shareholders. You can then proceed to change the trade name and share capital if you wish. You must file the changes you have made. Be careful when changing details, such as the name of the company, to avoid losing credit history.
Where to get a shelf company
You can go online and search for the shelf companies that are up for sale. Be careful because there are also scammers out there too. Look for a provider who is in the business of shelf companies. You will have to go through due diligence if you are buying from a service provider for the first time. The first purchase may be delayed for a bit of time because of the due diligence procedure. If you are pre-registered, you will have your shelf company in minutes.
A shelf company can be a powerful tool for entrepreneurs, and it offers them numerous benefits. There may be risks when you are buying the company, but these can be reduced by buying from reliable providers. Take your time to avoid losing money.