Incorporation

Under the Companies Act, a company means “a body corporate that is incorporated or continued under the Companies Act”. It is a separate legal entity from its shareholders or, in the case of a non-profit company, from its members. Upon its incorporation, a company has the capacity, as well as the rights, powers and privileges of an individual.

One of the important considerations behind a decision to incorporate a company is the fact that upon incorporation, the liability of the owners or shareholders is limited to the amount invested in the company or any amount unpaid on their shares.

Section 59 of the Companies Act, Cap.308 provides that a private company must have at least one (1) director, while a public company must have no fewer than three (3) directors, at least two (2) of whom are not officers or employees of the company or any of its affiliates.

A company may be incorporated by one or more competent persons (known as “incorporators”). Competent individuals, as well as bodies corporate may apply to incorporate a company by signing and filing articles of incorporation with the Registrar of Companies.

The Companies Act expressly prohibits the following individuals from forming a company:

1. Any individual under 18 years of age
2. A bankrupt
3. A person of unsound mind as found by a tribunal

“One-man” companies are permissible — a single incorporator may form a company and also be the sole director, officer holder and shareholder.

1. To create a legal entity separate and distinct from its shareholders or members
2. To limit personal liability of the shareholders or members
3. To create an entity with the capacity, rights, powers and privileges of an individual
4. To create an entity with perpetual existence which can outlive its shareholders
5. To qualify for incentives as an “approved small business” under the Small Business Development Act, 1999

There is no legal restriction on the type of business activity which may be conducted through a company. The Companies Act gives companies the same capacity, rights, powers and privileges as an individual.

Some commercial activities such as banking, insurance, trust and financial companies, and merchant banks may more conveniently be carried on through an incorporated company. The Financial Institutions Act, 1996 expressly provides that no license may be issued to any person other than a body corporate.

The following documents are required:

1. Approved Name Search and Name Reservation Form (Form 33)
2. Notice of Address or Change of Address of Registered Office (Form 4)
3. Notice of Directors or Notice of Change of Directors (Form 9)
4. Articles of Incorporation (Form 1)
5. Declaration by each signatory to the Articles of Incorporation

These documents are seamlessly incorporated in the digital system with the exception of the Declaration which is uploaded by the applicant.

Through the Corporate (Miscellaneous Provisions) Act 2021, the requirement of having an Attorney-at-law complete a Declaration on behalf of an incorporator has been removed. Each signatory now declares that he/she is not a prohibited individual.

However, an Attorney-at-Law may provide valuable advice and it is strongly suggested that one be consulted to advise on the legal implications of company formation.

Yes. A company must have a “common seal” with its name engraven thereon in legible characters. The company may also keep an “official seal” for use in a country other than Barbados, which must be a facsimile of the common seal bearing the name of every country where it is to be used.

The Articles of Incorporation must follow the prescribed form and set out:

1. The proposed name of the company
2. The classes and any maximum number of shares authorized to issue, including rights, privileges, restrictions and conditions for each class
3. If the right to transfer shares is restricted, the nature of those restrictions
4. The number of directors, or the minimum/maximum number
5. Any restrictions on the business that the company may carry on