Continuance

Just as natural persons may “pull up roots” in one country and migrate to a new jurisdiction, so too can companies abandon their jurisdiction of incorporation and establish a new, permanent home as an immigrant in another jurisdiction. There may be many reasons for such a move.

The most obvious reason might be that the focus of the corporation’s business has shifted to take advantage of new opportunities in another area. Again, the company may decide that the laws of a particular jurisdiction are more advantageous to the company than its present domicile and that it is in the company’s strategic interests to emigrate elsewhere.

Section 356.1 to Section 356.6 of the Companies Act, Cap. 308 set out the rules which govern corporate migration to and from Barbados, in the Act referred to as “corporate mobility” or continuance.

Barbadian companies are prohibited by section 356.5 of the Companies Act from applying for continuance in another jurisdiction unless the laws of the jurisdiction to which they are emigrating provide in effect that:

• The property of the company continues to be the property of the body corporate
• The body corporate continues to be liable for the obligations of the company
• Any existing cause of action, claim or liability to prosecution is unaffected
• A civil, criminal or administrative action or proceeding pending by or against the company can be continued by or against the body corporate
• A conviction against, or ruling, order or judgment in favour of or against the company can be enforced by or against the body corporate

A Barbados company desirous of emigrating to another jurisdiction must first apply to the Registrar of Companies under section 356.4 of the Companies Act for permission to continue as a corporation in the other jurisdiction. The application must be made in writing and supported by a Statutory Declaration which satisfies the Registrar in relation to the following matters:

• That the company has a right to apply for continuance by reason of the fact that the laws of the other jurisdiction make provision for the matters set out in section 356.5 of the Act
• That the company is authorised by special resolution of its shareholders to continue in another jurisdiction in accordance with section 356.4 of the Act
• That the proposed continuance will not adversely affect the company’s creditors

When the Registrar approves the company’s request to continue as a corporation in another jurisdiction, a letter of approval will be issued to the company signifying the Registrar’s consent to the proposed migration of the company from Barbados.

Issuance of the Registrar’s letter of approval will facilitate the company’s application for continuance in the jurisdiction to which it is emigrating.

When the company has been continued as a corporation in accordance with the laws of the other jurisdiction, the company is required to give notice to the Registrar of the fact of the continuance.

In practice, the Certificate of Continuance issued by the competent authority in the other jurisdiction (or a certified copy thereof) must be filed with the Registrar. Upon receipt of satisfactory notice, the Registrar of Companies will issue a Certificate of Discontinuance.

Upon the issuance of a Certificate of Discontinuance in Barbados, the company ceases to exist as a Barbadian company and becomes an “external company” for all the purposes of the Companies Act.

Yes. Barbados law permits any externally incorporated body corporate to apply for continuance in Barbados. The only pre-condition is that the law of the jurisdiction in which the company is incorporated must authorise the continuance.

Sections 356.1 to 356.3 of the Companies Act, Cap. 308 govern the circumstances in which a body corporate incorporated in a jurisdiction other than Barbados may apply to the Registrar of Companies for a Certificate of Continuance.

An externally incorporated company desirous of migrating to Barbados is required to file the following documents with the Registrar of Companies (in duplicate) together with the prescribed fees:

• Articles of Continuance in the prescribed form (Form 17)
• A Statutory Declaration satisfying the Registrar that the proposed continuance is permitted by the law of the jurisdiction from which the company is migrating
• Request for Name Search and Name Reservation (Form 33)
• Notice of Registered Office (Form 4)
• Notice of Directors (Form 9)

On the date shown in the Certificate of Continuance issued by the Barbados Registrar of Companies:

1. The body corporate becomes a company to which the Companies Act, Cap. 308 applies as if the company had been incorporated under the Act
2. The Articles of Continuance become the articles of incorporation of the continued company
3. The Certificate of Continuance is the certificate of incorporation of the company

In addition, the property of the company continues to be the property of the body corporate, the body corporate continues to be liable for the obligations of the company, and any existing cause of action, claim or liability to prosecution is unaffected.