Foreign LLCs may take the following forms:
Wholly Foreign Owned Enterprise: A Wholly Foreign Owned Enterprise (WFOE) is a structure used in China which is completely owned by foreign investors. These are LLC’s that provide the advantage of being governed under foreign jurisdiction.
International Joint Venture: Another type of foreign corporate structure is an international joint venture, or IJV, which may take the form of either an LLC or LLP. In these, a business partners up with a foreign entity to gain certain benefits.
Another international structure is a representative office. With this structure, a company simply establishes an office in a foreign country to perform certain non-transactional tasks, such as marketing. There are fewer regulations on representative offices because they aren’t truly businesses in and of themselves.
Benefits for Protecting Assets
A foreign entity can be highly beneficial for protecting assets. For example, if you hold an asset in your own name, it can easily be traced to you, and any lawsuits or litigations against you may result in its loss. However, if it is held in the name of a foreign LLC or other entity, then litigation may be moved to the foreign entity, making it much more expensive and time-consuming for the prosecution.
Often, this increased expense will result in charges, disputes, and litigations being dropped or otherwise resolved as it eliminates their profitability. This only really works if it is structured properly, however. Otherwise, you may have other issues arise with federal regulations, tax laws, and other legal complications.
Since an international corporate structure has certain implications for multiple jurisdictions, a thorough understanding of both domestic and foreign laws and regulations is vital to adequate formation of these entities. Hart & David can help you with the myriad of issues you’ll face, including:
- Entity structure
- International contracts and agreements
- Structuring transactions
- Representation in case of disputes or litigation
- Intellectual property protection
- Corporate governance
- Structuring joint ventures and partnerships
- Tax planning
Whether you are using a foreign LLC as part of your overall estate planning strategy, establishing an international joint venture to safeguard assets from litigation, or in need of any other assistance with foreign corporate structures, Hart & David can help you.
To begin the process of securing your assets, and allowing us to get to know you a bit better, please click the icon above and fill out the corresponding PDF to the best of your ability. Thank you.