St. Lucia

General Information
Incorporation in St. Lucia
Annual reports and payments
Mutual funds in St. Lucia
St. Lucia offshore banks
Insurance companies in St. Lucia
Directors of insurance companies
Insurance manager
Procedure of establishing an insurance company
Annual reports

General Information

St. Lucia is an island located between the Caribbean Sea and the Atlantic Ocean, north-west of Barbados, south of Martinique, and north of St. Vincent. It has an area of approximately 616 sq. km., 44 km in length and 23 km in width. The total population is estimated at 160,145. Castries is the island’s commercial centre and capital (population of 50,000 people). The Climate of St. Lucia is tropical. Language of St. Lucia is English and French-based patois. St. Lucia has a literacy factor of 67%.

The region we know as the Caribbean takes its name from the original people, the Carib Indians. The French, Dutch and English all established bases and attempted to colonise the island beginning around 1600. Throughout the 17th and early 18th centuries the island was contested between England and France (changing possession 14 times). In 1814 the island became English property. St Lucia gained internal autonomy in 1967 and full independence as a member of the British Commonwealth in 1979.

The political system is based on the British Westminster Model with Queen Elizabeth II,
represented by a Governor General, as titular Head of State. The cabinet under the leadership of the Prime Minister exercises executive authority. Legislative authority is vested in bicameral Parliament which consists of the Senate (11 seats) and the House of Assembly (17 seats).

St. Lucia's economy is traditionally based on agriculture. However tourism has been fast developing and is now the most important economic sector of the island (57%). St. Lucia now has the most diverse manufacturing sector in the Eastern Caribbean (32%), then goes offshore financial sector. Agriculture makes only 11%. However 43.4% of the labour force are engaged in agriculture, 38.9% in services, and 17.7% in commerce.

The currency of St. Lucia is the East Caribbean dollar, which exchanges with the U.S. dollar at a rate that has remained fixed since 1976 of USD 1 = ECD 2.700.

The legal system of St. Lucia is based on English common law. The principal laws regulating the activity of the offshore financial sector are the International Business Companies Act, the Registered Agent and Trustee Licensing Act (RATLA), the International Trusts Act, the International Insurance Act, the International Banks Act.

Incorporation in St. Lucia

It is possible to incorporate the following types of companies in St. Lucia: International Business Companies (IBC) Holding Companies, Personal Investment Companies, Import/ Export Companies, Professional Service Companies, Finance Companies.

To do business outside St. Lucia, an International Business Company (IBC) is incorporated according to the International Business Companies Act of 1999. An IBC may elect to be exempted from all taxes or to be liable to income tax on the profit and gains at 1%. An IBC is not subject to stamp duties and capital gains tax. Each company must have a registered office and a registered agent in St. Lucia. The name of all IBCs must end in one of Limited, Ltd., Incorporated or Inc., or their foreign language equivalents (GmbH, S.A., etc.).

IBC can have only one subscriber and thereafter only one shareholder (who could be corporate or individual, residents in St. Lucia or not). Usually companies are formed with 1000 shares of USD 1.00 per value. Bearer shares are not allowed. IBCs may have one or more directors. Directors can be corporate and need not be resident in St. Lucia. The First Directors are appointed by the Subscribers to the Memorandum and Articles of Association. With the exception of a Company Secretary, there is no requirement that officers be appointed.

To form an IBC's in St. Lucia the following non-disclosed information is required: names and addresses of directors and shareholders, certified copies of passports, bank and legal references for shareholders and directors (the information is kept with the registered agent and is not disclosed).

No accounts or information pertaining to the identity of shareholders or directors need be filed on public record. The Act provides for confidentiality of shareholders, directors and officers. Only the identity of the registered agent and the registered office are known, and the Memorandum and Articles of Association, once filed, become public records.

Annual reports and payments

A St. Lucian IBC is not required to file any statutory accounting or auditing records or reports in St. Lucia (unless it elects to pay tax). Annual government fee is US$300.00.
Meetings of directors and shareholders may be held anywhere either within or outside of St. Lucia and members may vote by proxy. The company can maintain books of accounts, records and minutes outside of St. Lucia.

Mutual funds in St. Lucia

A mutual fund licence may be held by an international business company or a unit trust.  The International Mutual Funds Act provides for two distinct types of mutual funds. The first is a Private Mutual Fund (PMF) and the other is an International Mutual Fund (IMF).
A Private Mutual Fund is described as an investment club of not more than fifteen persons, each of whom makes contributions in proportion to the shares/units they hold. (Currently this is being amended by parliament and will encompass any fund with up to 100 investors each of whom has contributed at least US$50,000.) Private funds are not required to obtain a license to operate but must register with the Director of Financial Services and Registrar and pay an annual registration fee of US$500. Private mutual funds are not required to have an administrator and do not have to have an annual audit or file an offering document (the other documents to be provided are the same as for an international fund and are listed below). A private fund can be established within 10-14 days upon submission of necessary documentation.

An International Mutual Fund must hold a valid licence and have a fund administrator based in St. Lucia (usually more then 100 members with not less then $50,000 investment each are required).

Any mutual fund must have at least two directors, one of whom must be a resident of St. Lucia. All directors must be natural persons. A corporate secretary must also be appointed.

The first step in the process of establishing an international fund is an application to the Minister for his consent to incorporate an international business company in St. Lucia for the purpose of carrying on mutual fund business in St. Lucia. The following information and documentation must accompany the application:

  • Particulars of the applicant, notarised copies of passports, police reports, banker’s, lawyer’s, accountant’s references and CVs on each director, shareholder and promoter .
  • The Business Plan
  • Offering Document
  • The Financial Projections (The projected financial statements should supplement the Business Plan and should cover a period of a least three (3) years. The projection for each of these years should round off with a Statement of the expected Net Asset Value (NAV) of the Fund).
  • Complete resumes for the Fund Manager, the Fund Administrator, the Investment Advisor and the Fund Custodian.
  • Auditors’ confirmation of appointment.
  • If the fund has a parent company, audited F/S for the parent for three years.

The Act provides that a mutual fund must have a St. Lucian based and licensed fund administrator. There are two (2) types of mutual fund Administrator’s licences that can be applied for, a restricted licence and an unrestricted licence. Restricted licence is issued solely in respect of funds specified in the Administrator’s licence. An unrestricted licence is a licence issued for an administrator in respect of an unlimited number of mutual funds. A fund administrator must be a company incorporated under the International Business Companies Act and must have not less than two directors (natural persons) one of whom must be a resident. The fund administrator rules mandate that a physical office be maintained here in St. Lucia. The accounts of the administrator must be audited annually.

Applicants for an administrator’s licence must demonstrate sufficient expertise to administer an international fund, sound reputation, and a net worth of $100,000.00.

There is no taxation of any kind on mutual funds or administrators (unless as IBC’s they elect to pay 1% tax).

St. Lucia recognises the need for confidentiality in business affairs. To this end, the country's IBC Registrar only maintains a copy of the IMF's license (a copy of the bank's license in case of an offshore bank) and a copy of its Memorandum and Articles of Association. The shareholders and directors are known only to the registered agent and to the Director of Financial Services. Both the registered agent and the Director of Financial Services are required by law, under threat of severe fines and penalties, to keep confidential all information obtained whether it be during the incorporation process, ongoing fund (bank) management or a Director's examination.

St. Lucia offshore banks

There are two classes of banking licenses available in St. Lucia:
"Class A" license or general license allows the institution to engage in the full spectrum of international banking activities with the general public;
"Class B" or "Restricted License" restricts the institution in that funds/deposits may not be solicited or accepted from persons other than those listed as part of the application package. The other restriction that applies to either class of bank is that they are prevented from conducting certain banking business with residents of St. Lucia.

The share capital for a "Class A" bank is USD$1,000,000 and for a "Class B" bank is USD$250,000. Only the statutory deposit of US$100,000 must be maintained in cash or certain specified near-cash equivalents. The remainder of the bank's capital can be contributed in securities, real estate or other assets with a readily determinable value. Recommend that no less than 50% of the bank's capital be contributed either in cash or in readily marketable securities.

The application for a banking license must include the following:

  • Listing of the shareholders (and their % holding), directors and officers, their in-depth resumes detailing the qualifications and past experience that make them suitable applicants to run a financial institution, certified copies of their passports, police certificates and references (three, one of which must be from a recognised banking institution).
  • A detailed business plan including a three-year revenue and expense projection.
  • Evidence of Liability Insurance in the amount of USD$500,000 may be required at the discretion of the Minister.
  • Engagement letter from an acceptable auditing firm.
  • A pro-forma balance sheet certified by the auditors demonstrating compliance with the capital requirements.

The bank must have at least two directors, both of whom must be natural persons and one must be a resident of St. Lucia. Once the company is formed, a local bank must be selected to hold the new institution's statutory deposit of USD$ 100,000 and the auditors must certify that the deposit is in place. The Director then issues the license upon payment of the relevant annual license fees. The fees are US$25,000 per annum for a "Class A" bank and US$15,000 per annum for a "Class B" bank (plus IBC registration fee of US$300 per annum).

Insurance companies in St. Lucia

Insurance companies are established in St. Lucia under the International Insurance Act, 1999 (the Act). First an IBC is incorporated and then it applies for a licence allowing it to be engaged in insurance business. The Act provides for three types of insurance licences with two additional subclasses. They are as follows:

  • Class A – General Insurance Business
  • Class B – Long term Insurance Business
  • Class C – General & Long-term Insurance Business
  • Subclass 1 is granted to an A or C licensee in respect of its general business where it is insuring risks of affiliates (a captive or self-insurance situation).
  • Subclass 2 is in respect of general business that is not captive or self-insurance (i.e. unrelated third parties).


The capital requirements for the various classes are as follows:

Class A Subclass 1  


Class A Subclass 2  


Class B                     


Class C Subclass 1  


Class C Subclass 2  


Besides, each insurance company is required to maintain a deposit of $50,000 in an approved bank (not necessarily in St. Lucia). The insurance company will be required to give a written undertaking that the deposit will be kept and maintained free and clear of all encumbrances during the currency of the licence.

Solvency margins are fixed as follows:

Class of license

Solvency margin

Class A 1

the greater of $100,000 and 10% of net retained annual premium (NRAP)

Class A 2

the greater of $150,000 and 20% of the first $5 million of NRAP plus 10% of any net retained annual premium in excess of $5 million

Class B

$150,000 (note that the liabilities of a life company must be certified by an actuary)

Class C 1

the sum of the margin required for Classes A 1 & B

Class C 2

the sum of the margin required for Classes A 2 & B

Directors of insurance companies

An international insurance company must have at least two directors one of whom must be a resident of St. Lucia. All directors must be natural persons.

Insurance manager

The Act does not mandate the appointment of an insurance manager. However, the application form calls for particulars of how insurance management services are to be provided.

Procedure of establishing an insurance company

The steps involved in incorporation of an insurance company include:
1) Application to the Minister of International Financial Services for his consent to incorporate an international business company in St. Lucia for the purpose of carrying out international insurance business. The Minister will carry out due diligence procedures on the parent company and/or the individuals involved in business.

2) At the same time an application for an insurance licence is made to the Director of International Financial Services. The Director will assess the insurance business intended to be carried out, the financial stability of the company, including the review of the business plan with all the relevant technical data.

The application form should include the following information:

  • Method of raising capital (i.e. cash, loan from parent etc)
  • Amount and nature of “loaned capital” if any and details of any loans from shareholder
  • Certified evidence of capital and undertaking to maintain capital and statutory deposit requirements
  • Name, date and place of birth, country of residence (now and for past ten years), address (current and for past ten years, supported by utility bills), citizenship(s) and full resume for each director, shareholder and senior management person, along with bankers references and two professional references per person.  Also required is a certified copy of the passport of each person and a signed copy of a statutory declaration (basically says the signatory is not a felon or of bad character)
  • Engagement letters confirming appointment of auditors, actuary and local legal counsel
  • If the applicant has a parent company, audited Financial Statements for the parent for three years
  • Full business plan with financial projections for three years
  • An opening balance sheet.

Business plan should contain the following:

  • Company background
  • Business objectives                                      
  • Projected financial position (3 years)
  • Financial statements for the parent company for the current year up to the end of the month before the application is being made (if applicable)
  • An organisational chart showing the group structure, where the Applicant is a member of a group
  • A detailed feasibility study explaining why the Applicant wishes to establish a captive insurance company and the assumptions underlying the financial projections
  • A clearly defined list of intended policyholders
  • A detailed account of how premiums will be calculated
  • Detailed basis on the manner in which Reserves will be calculated and some information on who will perform these calculations (the professional qualifications of this person must also be given)
  • Detailed information on the Applicant’s reinsurance strategy (if any), a copy of each proposed reinsurance agreement must also be attached; and
  • Sample copies of draft policies should be included as an Appendix to the Business Plan.

The relevant Government fees are a one-time application fee of US$500 and annual license fees of US$2500.

After the licence has been granted the following must be provided within ninety (90) days:

  • original (or notarised) bank statement showing that the capital has been injected into the company where the capital is cash, or other evidence of capitalisation;
  • original (or notarised) certificate of deposit showing that the $50,000.00 security deposit is being held at an approved bank; and
  • a duly executed Agreement of Undertaking by the company in favour of the Government of St. Lucia in respect of the security deposit.
Annual reports

Insurance Companies are IBCs and are therefore not subject to any taxes, unless they have elected to be subject to 1% tax, or stamp duties in St. Lucia. Annual license fee of US$2500 is payable by Jan 15 of each year, pro-rated to December 31 in the years of application.
The annual auditor's report is to be submitted to the Minister within three (3) months of the end of the company's financial year. Besides, every licensed insurance company is expected to maintain permanently at its principal office in St. Lucia books of accounts and records of its insurance business.

Promoter (frequently the same person who is organising the IMF) is the person who will be promoting the IMF in the international marketplace.



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What is offshore?

The word "offshore" has no precise legal dictionary definition, it simply means "situated or operating in a foreign country or at some distance from the shore" and reflects the fact that most low tax jurisdictions are islands.


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