Marshall Islands

ESSENTIAL FACTS

LOCATION: 9 00 N, 168 00 E
The Marshall Islands are comprised of two archipelagic island chains of 29 atolls, each made up of many small islets, and five single islands. It is located in the North Pacific Ocean.

POPULATION: 61,815
The city of Ebeje is one of the Pacific’s most densely populated areas, on the island of Majuro, with about half of the country’s population.

CURRENCY: US dollar (USD)

LANGUAGE: Marshallese (official); English is widely spoken as a second language and taught in schools from an early age

CLIMATE: The Marshall Islands have a tropical, hot and humid climate.

EDUCATION: Marshall Islands natives age 15 and over can read and write: 93.7%

PUBLIC HOLIDAYS: Constitution Day, 1 May (1979)

HISTORY AND GOVERNMENT

HISTORY
The Marshall Islands’ history dates back about 3,000 years, with its original settlers being Polynesian. Then starting in the mid-1500s, Spain, Germany and Britain settled there at various times. It was not until after World War II that the Marshall Islands fell under Unite States administrative responsibility as a United Nations Trust Territory of the Pacific Islands.

POLITICAL SYSTEM
The Marshall islands have a constitutional government in free association with the US. The chief of state and head of governments falls to the President, with members of his or her Cabinet coming from the legislative population. Speaking of the legislature, it is unicameral (Nitijela). IN addition, there is a Council of Chiefs (Ironij) is a that advises on matters affecting customary law and practice

JUDICIAL SYSTEM
The legal system is based on adapted Trust Territory laws and includes the Supreme Court, the High Court and the Traditional Rights Court.

COMMERCE AND TRADE

COMMERCIAL ACTIVITY
Agriculture: Coconuts, tomatoes, melons, taro, breadfruit, fruits; pigs, chickens
Industry: Copra, tuna processing, tourism, craft items from seashells, wood, and pearls

TRADE PRACTICES
Exports: Copra cake, coconut oil, handicrafts, fish to the US, Japan, Australia, China
Imports: Foodstuffs, machinery and equipment, fuels, beverages and tobacco from the US, Japan, Australia, New Zealand, Singapore, Fiji, China, Philippines

BANKING, FINANCE AND INVESTMENT

FINANCIAL FACTS
The Marshall Islands economy is mainly supported by American aid (U.S.). Tourism only employs a small percentage of the people. They have a significant trade deficit. Gross Domestic Product numbers have only risen by one percent in the last 10 years.
Fiscal year: 1 October - 30 September

MEMBERSHIPS
ACP, ADB, FAO, G-77, IAEA, IBRD, ICAO, ICCt, IDA, IFC, ILO, IMF, IMO, IMSO, Interpol, IOC, ITU, OPCW, PIF, Sparteca, SPC, UN, UNCTAD, UNESCO, WHO

FOREIGN INVESTMENT
The Marshall Islands actively encourage foreign investment of every kind, in particular in tourism and manufacturing. A Foreign Investment Business License (FIBL) issued by the Registrar of Foreign Investment in the Office of the Attorney General is necessary in order to conduct any business on the island (for non-residents, of course).

IMMIGRATION

VISAS
All those except for Americans require a visa to visit the Marshall Islands. The visa must stipulate whether the traveler is in the Marshall islands for business or pleasure, and each visa holds a different surcharge. Visas are good for 30 days, and can be extended for up to three months as long as there is proof of sufficient funds for each traveler.
In addition, vaccinations are mandatory before entering the Marshall Islands, and travelers must present at time of entry certificates of vaccination for yellow fever, cholera, Hepatitis, diphtheria, tetanus and typhoid.

EMPLOYMENT
Employees must first show cause for hiring someone not native to the Marshall Islands for the desired position, and state in writing the information regarding the need for a non-resident to be employed by the company. This is sent to the Chief of Labor in the Ministry of Foreign Affairs, who then asks for an additional 30 days waiting time before submitting the application for a particular non-resident. Again, there must be stated in writing the specific reasons why this person and no other in the Marshall Islands can be accepted for the position. Once all the paperwork has been submitted, the permit will be issued within two weeks.

RESIDENCE
The Attorney General of the Marshall Islands approves all residency applications and grants resident permits to those who meet the requirements.

BUSINESS

BUSINESS ENTITIES
The Marshall Islands company laws are based on those in the US states of New York and Delaware, the latter being a tax haven on American soil, and adapted further to incorporate offshore characteristics. The governing authority on offshore business activity on the Marshall islands is the US International Registries, Incorporated, or rather their subsidiaries located on the Islands, which has an agreement with the local government.

Limited Liability Companies (LLC) is by far the most common type of incorporation form for the Marshall Islands. The registration process requires the name of the company, its registered agent’s information (located in Marshall Islands), and any duration date and other articles of association deemed necessary by the company.

A Marshall Islands Corporation is equally simple to establish, and is also available to non-residents of the Marshall Islands. In fact, the entire registration process takes no more than 24 hours. This incorporation registration provides for a lot more flexibility, in terms of additional provisions and clauses the company officers might want to add.
Other company types available in the Marshall Islands are re-domiciliated companies, partnerships, limited partnerships and foreign maritime entities.

LABOR

BENEFITS AND PENSIONS
Seven percent of an employee’s income must be put aside for social security. Health insurance is 3.5 percent of the employee’s salary. Additional percentages must be contributed from the employer’s revenues.

TAXATION

PERSONAL TAXATION
The income of those employed at non-resident companies in the Marshall Islands do not have to pay income taxes. For the rest of the working population, income is taxed on a sliding sclae capping at 12 percent.

CORPORATE TAXATION
Foreign investments over USD$1 million or employee wages totaling over USD$150,000 are necessary in order to take advantage of a five-year tax holiday in the Marshall Islands. This is good for hotels, resorts, exports, fishing businesses and agriculture.

All offshore companies, i.e. those doing business outside of Marshall Islands’ borders, are completely exempt from taxation.

OTHER TAXATION/DUTIES
Each local government in the Marshall Islands taxes sales between two and four percent.