An amendment to the Bahamas International Business Companies Act was recently published. Below you will find a summary of said amendment for your information. 

The amendment only consists of an extension of the definition of Authorized Capital, and allows an IBC can be registered as another type of legal entity, from the Bahamas jurisdiction, known as Segregated Account Companies.

International Business Companies (Amendment) Act 2013:

  1. The definition of authorised capital is broadened and it is explained in further detail that the authorised capital of a Bahamas IBC may encompass the following:
    1. Capital limited solely by shares without par value
    2. Capital limited both by shares and by guarantee
    3. Capital limited both by shares with par value and shares without par value.

The current definition of "authorised capital" in the IBC Act makes reference to the sum of the aggregate par value of all shares which the company is authorised by its Memorandum to issue plus the amount to be represented by shares without par value (provided that the company is authorised by its M&AA to issue said type of shares). It should be noted that we already have a model Memorandum  for companies whose capital is limited by guarantee.

  1. Provision allowing IBCs to be registered as Segregated Accounts Companies, under the laws of the Bahamas, has been included.

A Segregated Accounts Company (SAC) is a Bahamas legal entity, that is regulated by the Segregated Accounts Companies Act, 2004; such entities allow the creation of separate accounts or "segregated accounts" whose aim is to enable the separation of different assets and liabilities.

For IBCs to be converted into SACs, the approval of the Registry and the primary regulator is required; for companies involved in the investment funds sector the regulator is the Securities Commission of the Bahamas, for companies engaged in the field of insurance the regulator is the Registrar of Insurance, for subsidiaries of banks or trust companies the regulator is the Central Bank of the Bahamas (with the exception of banks or trust companies that engage in activities within the Bahamas), the primary regulator of companies that engage in any other kinds of businesses shall be specified by the Minister.

This type of entity must have a representative within the Bahamas who must be regulated in said jurisdiction (e.g. Regulated by the Banks and Trust Companies Act, by the Financial and Corporate Services Act, etc.).

This type of entity is subject to the same requirements as the Bahamas IBCs, such as keeping accounting records and filing an Annual Declaration every year (signed by two of the company's directors) certifying that the operations of the company during the previous year were carried out in accordance with the provisions of the Law.