Effect of Pandemic Virus upon Business?

COVID 19 Is effecting all kind of business

Effect of Pandemic Virus upon Business?
Corona Virus Effect

It is a nightmare. It is a year of nightmare. It is a nightmare that many people, their family, relatives, friends, etc are dead without help. The point is that after we wake up, we still hear from the news we have 1,000 people dead from virus, Coronavirus. It is a pandemics that it has very high contagious. Now many countries are lock down, that means schools close, businesses close, government offices close, all close. Local economies close, and global economies close.  Closes means businesses will close forever; workers become unemployed. Local economies are going to recession, global economies become very risk.This virus will die some months in future. However it will return again, unfortunately scientists haven’t invented a vaccine. That means if Coronavirus comes back, it will lockdown again. Can you afford for second Lockdown ?This is the time you need to change your business model. Many consumers will choose online supermarkets to buy food, etc. Many parents will buy toys online. If you need to hold a meeting, you can go with online meeting. Schools are online teaching. Yes, online business model. You need ultimate online business model. It is a model that you do business via online operations. From physical to non-physical, as your clients have changed their buying habits, from physical to online.

Advantage of Online Business

The main advantage of online is that you can do local business, and also do with global business. That means you can expand your market globally. The importance is that you can diversify your risks of business, at least to prevent Lockdown risks.
You need offshore mechanics. It means you need offshore company, offshore bank, offshore supports for your offshore operations. Offshore is not means overseas, but online. Frankly speaking, you need online company, online bank, online supports for your online operations to prevent Lockdown risks.

Advantages of online companies

  1. Global markets
  2. No VAT
  3. No corporation tax

Advantages of online banks

  1. Online banking services
  2. Multi-currency supports
  3. International payment gateways supports to global business

What online companies are best ?

We will list out some points which most businessmen will regard as the best:
Global markets

  • No VAT
  • No or low corporation tax
  • Not expensive for setup
  • Privacy of Protection
  • Fast setup
  • No money laundering problem

As an experience offshore professional, I can tell you that it is impossible to find a jurisdiction which can meet all the points above. However, we can combine one jurisdiction to another jurisdiction so as to meet all the points above.

Online business strategies

We recommend Seychelles setup as Seychelles meet six points above, namely:
Global markets

  • No VAT
  • No or low corporation tax
  • Not expensive for setup
  • Privacy of Protection (Seychelles has no public search register)
  • Fast setup

However, it doesn’t solve out money laundering problem. As if you make profits, Seychelles law don’t allow you to file tax documents, so you cannot explain your sources of funds. Most likely government officials will regard unexplained funds as money laundering issues.

How to handle money laundering problem?

We can register again with Hong Kong tax authority with Seychelles setup. Under this arrangement, Hong Kong tax authority will issue tax documents to the taxpayer, however as client hasn’t done business in Hong Kong, under Hong Kong tax law, client is not required to pay tax in Hong Kong. We can help client to make exemption of tax paid in Hong Kong. Therefore, client will get an official tax notice that client is exempted from their sources of funds. Client gets an official proof of source record from Hong Kong government tax authority.

This is a strategy we will:

  1. Register client with Seychelles setup
  2. Register again with business registration through Hong Kong tax authority.
  3. After that we can open online business accounts. Before discussing business accounts, clients have to know what are FACTA, and Common Reporting Standards.
  4. FACTA is a 2010 United States federal law which requires all non-U.S. foreign financial institutions (FFIs) to report their bank data to USA.
  5. The Common Reporting Standard (CRS) is an information standard for the Automatic Exchange Of Information (AEOI) between financial institutions (FFIs) towards their tax authorities over the global level.

How can I find a bank who escape from FACTA or CRS?

Over years to study global banks, I can tell you that if you find a bank who claim he is not under FACTA or CRS. This bank is a scammer. Banks are the traditional banks like HSBC, Citibanks in which they hold banking licenses and are engaged in banking services which are under the rules of FACTA, and CRS. Online banks are E-banks over the world which provide bank services under e-plates but hold banking licenses, and so they are under the rules of FACTA, and CRS.
However, in Hong Kong, bank services are under banking licenses which are issued by Hong Kong Money Authority. So all banks in Hong Kong are under FACTA or CRS. Hong Kong has no E-banking industry at the moment. They are still under legal process.
To supplement this shortfalls for international clients, Hong Kong government assigns Hong Kong Customs and Excise Department to issue Money Service Operators (MSO) licenses for international banking services. Hong Kong Customs and Excise Department is not Hong Kong Money Authority, and has no power to issue banking licenses, and so MSO banks are not subject to ACTA or CRS. However, Hong Kong Customs and Excise Department allows to issue MSO licenses which can provide bank services.

Hong Kong MSO can provide online business account services to global clients with:

  1. Personal or Corporate business accounts With multi-currencies
  2. Provide deposit services and payment services worldwide
  3. Provide payment processing and payment gateway services
  4. Provide personal or corporate debit cards which allow access fund over the world through global cash machine
  5. But they don’t allow provide other banking services like insurance, investment, etc.

So we do suggest for ultimate online setup for online operations with online bank services which include:
Receipt of payments from clients/Settlement of payments to suppliers with Multi currencies through Wire Transfer, Stripe/Paypal, Visa, Master, AE cards, Debit cards We have worked with three MSO bank services which can open online business accounts by remote, and within 1 week.
So with new setup by remote, we can do within 1-2 days:
Open online-business account in HK, we can do within 1 week by remote. Therefore, working with us, for our ultimate online setup for online operations with online bank, it takes only within 1 week.

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