IsleofMan

CompaniesandCapitalMarkets.

SteveCummins
TransworldGroupofCompanies,IsleofMan

AgrowingnumberofnewapplicantstoAIM,PLUS
andtheMainMarketoftheLondonStockExchange
areIsleofMancompanies.Clearlyanincreasing
numberofbusinessesarerealisingthesignificant
advantagesofusinganIsleofManvehicletoaccess
capitalmarketsintheUK.

WhytheIsleofManisthePlaceto
IncorporateyourListingVehicle?

TheIsleofManisinthevanguardofmoves
towardstransparencyandregulationin
internationalbusinessandisrecognisedasoneof
thebestregulatedinternationalfinancialcentres.
TheIsleofManhasahighqualitystablepolitical,
legalfiscalandregulatoryenvironmentandhas
anAAAcreditratingfrombothStandardand
PoorsandMoodys.
TheIsleofManisanEnglishspeakingjurisdiction
inthesametimezoneasLondon.TheCityof
Londonisonlyaonehourplanejourneyfromthe
IsleofMan.Attendanceatboardmeetingson
theIslandisthereforestraightforwardand
convenient.
Thegeneralrateofcorporateincometaxinthe
IsleofManis0%(withtheexceptionofsome
regulatedsectorsandincomederivedfromland
andpropertyintheIsleofMan).Thistaxregime
obviatestheringfencingassociatedwithtax
exemptregimesandthusmeetstheexpectations
oftheinternationalcommunityasregardstax
competition.
Therearenocapitalgainsorstamptaxesinthe
IsleofMan.
Noregulatoryapprovalisrequiredtoforma
publiccompany.
Closedendedinvestmentcompaniesarenot
classedasfundsunderIsleofManlawandare
notthereforesubjecttotheIsleofManfunds
regulatoryregime,savingtimeandcosts.
AnIsleofManpubliclimitedcompanywhose
sharesaretradedonaregulatedmarketisnota
regulatedentityintheIsleofManandthe
administrationofsuchacompanyisnot
regulatedasfundadministration.
SharesinanIsleofMancompanycanbetraded
throughCRESTwithouttheneedtouse
depositaryreceipts.

TheIsleofMansharesitscompanylawheritage
withEnglandandothercommonlaw
jurisdictions,inparticulartrustandsecuritylaw
closelyfollowsEnglishstatuteandprecedent.
Cityfinancehouses,lawyersandadvisersare
familiarwithIsleofMancompanies,sodealcosts
canbeminimised.
IsleofManlawyers,accountants,banksand
administratorsareexperiencedincapitalmarkets
transactions.
TheIsleofManhasawellestablishedandwell
regulatedinfrastructurefortheprovisionof
corporateadministrationservices.Allproviders
ofcompanyadministrationservicemustbe
licensedbytheIsleofManFinancialSupervision
Commission(FSC).
TheIsleofMangovernmentoffersinward
investmentincentivestocertainbusinesses
lookingtoestablishsubstantiveoperationsinthe
IsleofMan.
Since1March2009theTakeoverCodeapplies,
givingtheTakeoverPanelstatutorypowersto
enforcetherulesinrespectofcompanies
incorporatedintheIsleofManwhosesecurities
areadmittedtotradingonaregulatedmarketin
theUK.
TheIsleofManCompaniesAct2006introduced
asimplerandmoreflexiblecorporatestructure
whichbenefitsfromtheremovalofcapital
maintenancerequirementsandlessprescriptive
prospectusrequirements.

KeyFeaturesoftheCompaniesAct
2006
CompaniesincorporatedundertheCompaniesAct
2006(theAct)arewellsuitedtocapitalmarkets
scenariosthroughtheirflexibilityandeaseof
administration.Somekeyfeaturesinclude:

TheActdoesnotdistinguishbetweenpublicand
privatecompaniesand(subjecttoany
restrictionsinacompanysmemorandumor
articlesofassociation)anytypeofcompany
undertheActcanofferitssecuritiestothe
public.Ifacompanydoesissueanoffering
documentthecriteriawithwhichtheoffering
documentmustcomplyarelessprescriptivethan
traditionalprospectusrequirements.TheAct
simplyrequiresthedirectorstoensurethatany

offeringdocumentissuedinrelationtoa
companycontainsallmaterialinformationthat
theintendedrecipientswouldreasonablyexpect
toenablethemmakeaninformedinvestment
decisionandofwhichthedirectorswereaware
orwouldhavebeenawarehadtheymade
reasonableenquiries.
TheActsweepsawaythetraditionalconceptof
capitalmaintenance.Acompanyincorporated
undertheActdoesnotneedtoclassifyitsassets
asincomeorcapital.InsteadtheActallowsa
companytodistributeitsassetstoitsmembers
(whetherbywayofdividend,buybackor
redemptionofsharesorotherwise),provided
thatthedirectorsofthecompanyaresatisfied
thatthecompanywill,immediatelyafterthe
distribution,satisfythesolvencytest.Acompany
willsatisfythesolvencytestifitisabletopayits
debtsastheybecomedueinthenormalcourse
ofitsbusinessandthevalueofitsassetsexceeds
thevalueofitsliabilities.
Similarlyacompanycanreduceitssharecapital
inanyway,withouttheneedforthesanctionof
theCourt,providedthatthedirectorsare
satisfied,onreasonablegrounds,thatthe
companywillimmediatelyaftersuchreduction,
satisfythesolvencytest.
Thereisnorequirementforacompanytofile
detailsofitsmemberswiththeRegistrarof
CompaniesortonotifytheRegistrarofany
changesinitsdirectors(althoughdetailsofa
companysdirectorswillneedtobeincludedon
itsannualreturn).
TheActcontainsveryfewprescriptiverules
relatingtomembersmeetings.Companiesare
notrequiredtoholdannualgeneralmeetings
andtheActallowsmembersmeetingstobeheld
atsuchtimeandinsuchplaces,withinor
outsidetheIsleofMan,astheconvenerofthe
meetingconsidersappropriate.Exchangetraded
companieswillofcourseprovideforannual
membersmeetingsintheirarticlesof
association.
TheActprovidesanextensiverangeofmember
protectionprovisions.UndertheAct,members
havetherighttoapplytoCourtforarestraining
complianceorder,therighttobringderivative
actions,remediesforoppressiveorunfairly
prejudicialconduct,therighttobringpersonal

actionsandtherighttoapplytoCourtforan
orderthataninvestigationbemadeofthe
companyandanyofitsassociatedcompanies.
EverycompanyincorporatedundertheActhas
tohavearegisteredagentintheIsleofMan
licensedbytheFSC.Thisrequirementensuresa
licensedprofessionalontheIsleofManis
responsibleforoverseeingtheadministrationof
thecompanyandregulatorycompliance.

TheIsleofMansTrackRecordin
CapitalMarkets

TheIsleofManisthefirstchoicenonUK
jurisdictionforincorporationofvehiclesfor
admissiontoAIM,with67IsleofMancompanies
admittedtoAIM.

IsleofManCompaniesmakeupthelargestshare
ofthenonUKAIMcompaniesmarket
capitalisation.

Thefavouredjurisdiction
forinternationalAIM
listings

ContactUs
enquiries@transworldcapital.im

SteveCummins
TransworldGroupofCompanies
69AtholStreet,
Douglas,IsleofMan,
IM11JE,BritishIsles

www.transworldcapital.im

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