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The Aruba Exempt Company (AVV) is a new concept, introduced by Aruba in 1988. The purpose of the introduction of the AVV has been to increase the possibilities of the offshore companies in Aruba. The AVV is not intended for residents of Aruba. The most important feature of the AVV is its complete exemption from all taxes. Instead, a registration fee of approximately AR. 500 (US$ 280) is charged each year. The capital of an AVV may be divided by the designation of stock shares. Registered shares as well as bearer shares are allowed, and preference shares may also be issued. Non-voting shares may be issued, provided that at least one voting share has been issued. The minimum authorized capital for an AVV is Afl. 10,000 (US$ 5,600). The AVV cannot participate in the economy of Aruba., therefore no transactions with onshore companies or residents are allowed. An AVV is not allowed to be active as a credit institution or credit association. The AVV is established by the execution of a notarial deed, and as a rule can be incorporated within one day. One shareholder is sufficient. The incorporator does not have to participate in the share capital. The AVV is exempt from several obligations. Annual financial statements are not required, AVV is exempt from currency restrictions. The Articles of Association of the Aruba Exempt Company can determine where the general meetings of the shareholders will be held. These may take place anywhere in the world. Individuals, as well as legal entities, may be designated as directors of an AVV. The individual may not be a resident of Aruba, while the legal entity may solely be a company established under the laws of Aruba, of which the purpose-clause includes the administration of an AVV. The AVV must be represented permanently by at least one Aruban company (usually a trust office) acting as local registered agent. The general tax exemption, in combination with the many practical possibilities, allows the AVV to be of great value in the offshore sector. On the other hand, the tax exemption of the AVV can lead to fiscal complications. With regard to AVV's, the trust offices provide a wide range of corporate management and professional services. The trust offices also look after the interests of the share holders, stock holders, or other creditors of the AVV. They also mediate by establishing a business or act as founder of the AVV.
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