Glossary
This Glossary is intended to provide the specific meaning of words used in the context of the EBC web site. These definitions are not given as tax and/or legal advice.
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Apostille
An apostille is a written authentication of a public document used in countries that are members of the Hague Convention of 1961. Each member country recognises the apostille as a certificate of authentication from another member country. Apostilles are usually required by banks with the opening of an account.
ASSEDIC
The French state unemployment benefit insurance scheme that is also applicable in Monaco.
Assets
A person’s economic assets are all items that have a value including cash, inventory, stock, property, goodwill and monies owed. These can be used to settle a debt. The assets are applied against the liabilities to find the balance, either positive or negative, of a company’s or a person’s affairs.
The owners of bearer shares are shareholders of the company. There is no official record of the individual or legal entity holding the shares. The practice of issuing bearer shares is becoming more limited with the introduction of anti-terrorist legislation in offshore jurisdictions.
Beneficial Owner
The same as the beneficiary.
Beneficiary
The beneficiary is entitled to receive benefits as a result of a legal arrangement including a trust or International Business Company. The beneficiary may be a person or a legal entity.
Bureau Administratif
A Monaco business entity. An administrative office of a foreign company.
An executive or manager.
Caisse Autonome des Retraites (CAR)
The Government Pension Fund in Monaco.
Caisse de Compensation des Services Sociaux (CCSS)
The Government Health Insurance Scheme in Monaco.
Carte de Séjour
A residence permit.
Carte d’Identité
Identity card.
Certificate of Good Standing
A Certificate of Good Standing is an official attestation by the authorities of a jurisdiction where a company is incorporated which states that the company exists and is in compliance with the requirements of the local laws. To be in good standing a company must make timely payment of annual fees and local taxes as well as filing the company’s annual statements and/or returns where necessary.
A Certificate of Good Standing is often requested by banks when opening an account with them.
Certificate of Incorporation
A Certificate of Incorporation is the evidence of incorporation and registration of the legal entity with the authorities of an offshore jurisdiction. It includes the necessary basic information about the company including the name, date and place of registration, entry number in the register, etc.
A Certificate of Incorporation is often requested by local authorities and by banks when opening an account with them.
Certificate of Incumbency
A Certificate of Incumbency is issued by the registered agent of the company or the authorities of the jurisdiction of incorporation. The document attests that the person(s) listed is (are) actually director(s) of the company.
The Certificate of Incumbency is often requested by banks when opening an account with them.
Common Law
The system of Common Law is used in most British Commonwealth countries including Australia, and the UK as well as the USA. Common law is based on past court decisions or precedent whereas in a civil law system, the law is made by statute and code. International Business Company and trust legislation has mainly been set up under the common law in most jurisdictions.
Company
A company is a lawful legal entity, set up and owned by one or more people and/or legal entities. It can undertake all types of commercial activities such as owning shares and other securities and property. It can borrow and loan money. It has the rights and responsibilities of a natural person and bears liabilities, but exists and acts separately from its owners.
Company Limited by Guarantee
A company limited by guarantee restricts the contributor’s liability to the amount that they have agreed to contribute to the company's assets in the event that it is wound up.
Company Limited by Shares
A company limited by shares is a company where the owner’s liability is limited to the amount unpaid on shares they hold.
Corporate Director or Secretary
A corporate director is a legal entity appointed to the position of director or secretary of a company. Corporate directors or secretaries are permitted in certain jurisdictions and permit greater anonymity.
Corporation
See Company.
Direction de la Sûreté Publique
The Directorate of Public Security. In Monaco, the Residents Section of the Directorate of Public Security is responsible for the administration of the Carte de Séjour.
Direction de l’Expansion Économique
The Government Department of Economic Growth in Monaco.
Direction des Services Fiscaux
The Fiscal Department of Monaco.
Domicile
The domicile is the legally recognised residence of a person. It may not be the actual physical location of residence but rather the place that the person intends to return to.
Double Taxation Treaty
A Double Taxation Treaty is made between two countries to prevent the double imposition of taxes on income or gains earned in both countries. That is, where a person or legal entity is resident in one country and has income or gains arising in the other, the Double Taxation Agreement provides for the right to tax to be held by only one of the countries. In the case where the right to tax is left with both countries the Double Taxation Treaty generally provide for the country of residence to either exempt the income or gains from further taxation or give a credit against the tax for the tax paid in the other country.
The documentation provided by the employer at Monaco to confirm the offer of employment to a non-resident.
European Union
The European Union (EU) is an intergovernmental organization founded in 1951. There are currently 25 member states including: Austria, Belgium, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden and the United Kingdom. The next possible future members include Croatia and Turkey.
The main objectives of the EU are to promote a single economic market with European citizenship, currency (the Euro) and law.
Exchange Control
A mechanism used by governments to control and limit transactions in foreign currencies.
Manager.
Grande Braderie
Large clearance sale.
Grantor
See Settlor.
A parent company that holds shares (interest) in another company or other companies.
The incorporation of a company is the legal process of establishing the company. The incorporation involves the submission of documents to the relevant authorities, followed by their registration and issuing by the authorities of proper documentary evidence of the company's legal existence (e.g. by way of Certificate of Incorporation).
International Business Company (IBC)
An International Business Company (IBC) may have a slightly different form depending on the jurisdiction but essentially it is a legal entity that is exempted from all or the most part of taxes in the jurisdiction of incorporation. A typical IBC can carry on business outside its jurisdiction of incorporation, have meetings of its Directors and/or Members anywhere in the world, keep any number of bank accounts in various currencies, and issue bearer shares.
The jurisdiction is the country or territory. Each jurisdiction has its own legislation governing the incorporation and operation of an offshore company or legal entity.
Jurisdiction of Incorporation
The original jurisdiction where the company or corporation was incorporated.
A legal entity, e.g., an International Business Company exists independently from its shareholders. Generally, the liability is limited to the assets a legal entity owns, and the personal property of the members, founders or shareholders may not be seized by the creditors. A legal entity has many features of a natural person e.g. it may hold property, sue other legal and natural persons, and be responsible in a court for its actions.
Liability
Any current or future legal obligation, e.g. debt, duties under a contract or a position.
Limited Liability
The restricted liability of a shareholder in a Company Limited by Shares or Company Limited by Guarantee.
The Ministry of State in Monaco.
When a company is registred, located, or operated in a foreign country. This arrangement may be used for tax-planning purposes.
Offshore Financial Centre
A jurisdiction providing some or all of the following services: low or zero taxation; moderate or light financial regulation; banking secrecy and anonymity.
A term used to describe the company that is the original company that then has subsidiaries or branches.
Partnership
A legal entity established by two or more persons (partners) by the contribution of capital and labour. The partners share an agreed proportion of profit and losses. However, a typical partnership does not create a legal entity separate from the partners, and is tax transparent. The partners' liability is not limited and may extend to their personal property.
Private Unlimited Company
A company with unlimited liability or obligation on the part of its shareholders.
Public Limited Company
The shares of a public limited company may be offered for sale to the general public and members' liability is limited to the amount unpaid on shares held by them.
An acknowledgement or receipt. In terms of this site it is the official acknowledgement of the application for a visa.
Registre de Commerce et de l’Industrie
The Trade and Industry Register, Monaco.
Registred Agent
A registred agent represents a company in the jurisdiction of incorporation. A Registred Agent normally provides a Registred Office address, provides liaison with local authorities and receives all legal and tax papers and/or notices addressed to the company.
Registred Office
The registred office is the official address of the company. It must always be an effective address for delivering documents to the company. The Registred Office is provided by a Registred Agent.
Resident
A person having their domicile and/or place of business in the given jurisdiction.
The Government Department of Employment in Monaco.
Settlor
The person who creates a trust by donating property to be managed and administered by a trustee but from which all benefits and profits would go to a beneficiary.
Share
Part ownership in a company limited by shares.
Share Certificate
A document signifying part ownership in a company. Same as a "Stock Certificate".
Shareholder
The owner of one or more shares in a company.
SICCFIN
The SICCFIN or Service d’Information et de Contrôle sur les Circuits Financiers is a special unit established under the Monaco Government’s Department of Finance and Economic Affairs charged with the task of co-ordinating the Government’s anti-money laundering and terrorism approach.
Société Anonyme Monégasque (SAM)
A Monaco business entity. A Public Limited Liability Company.
Société A Responsabilité Limitée (SARL)
A Monaco business entity. A Private Limited Liability Company.
Société Civil Immobilière (SCI)
A Monaco business entity. A Non-trading or asset holding company.
Société en Commandite par Actions (SCA)
A Monaco business entity. Partnership limited by shares.
Société en Commandite Simple (SCS)
A Monaco business entity. A sleeping partnership.
Société en Nom Collectif (SNC)
A Monaco business entity. A private partnership.
Sovereign Ordinance
Sovereign Order.
Statut
Statutes, regulations or byelaws. In the context of this website, the statutes or private deeds of the company.
Subsidiary
A company with a majority of its shares being owned by another company.
A jurisdiction where local legislation provides for considerable tax exemptions for non-residents.
Tax Planning
The legal steps a person plans and/or undertakes to minimize lawfully his/her/its tax liabilities.
Taxe sur la Valeur Ajoutée (TVA)
Value Added Tax.
Trust
A legal mechanism placing ownership of property in the name of one person, the trustee, which is to be held by the trustee for the use and benefit of some other person, the beneficiary.
Trust Company
A company properly licensed by the authorities to provide services of a Trustee.
Trustee
The person who administers and manages the property transferred in a Trust. This person becomes a legal owner of the property. In due time, a Trustee distributes the property and/or relevant earnings under the trust among the beneficiaries.
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