Vanuatu

ESSENTIAL FACTS

LOCATION: 16 00 S, 167 00 E
Vanuatu is a chain of four large islands and 80 small islands in the South Pacific Ocean, many with active volcanoes.

POPULATION: 211,971

CURRENCY: vatu (VUV)

LANGUAGE: There are more than 100 local languages spoken in Vanuatu, as well as pidgin (known as Bislama or Bichelama), English and French

CLIMATE: Vanuatu has a tropical climate. From May to October southeast trade winds provide mild temperatures. The rainy season is from November to April. Cyclones can be a problem from December to April.

EDUCATION: 74 percent of those 15 and over can read and write.

PUBLIC HOLIDAYS: Independence Day, 30 July (1980)

HISTORY AND GOVERNMENT

HISTORY
Although there have been settlers from many parts of the world who have tried for power over Vanuatu, which until 1980 was called New Hebrides. From 1906 until their independence in 1980, France and England shared administrative rights over the island chain.

POLITICAL SYSTEM
Vanuatu is a parliamentary republic. The chief of state, the President, and the head of the government, the Prime Minister, lead the country.

The Prime Minister names the Council of Ministers, responsible to Parliament, who in turn report to the Parliament. The legislature is a unicameral Parliament. The National Council of Chiefs advises on matters of culture and language.

JUDICIAL SYSTEM
The Vanuatu legal system is based on the former dual French and British systems. There is a Supreme Court, which is appointed by joint resolution from the Judicial Service Commission and the Prime Minister.)

COMMERCE AND TRADE

COMMERCIAL ACTIVITY
Agriculture: Copra, coconuts, cocoa, coffee, taro, yams, fruits, vegetables; beef; fish
Industry: Food and fish freezing, wood processing, meat canning

TRADE PRACTICES
Exports: Copra, beef, cocoa, timber, kava, coffee to Thailand, India, Japan
Imports: Machinery and equipment, foodstuffs, fuels from Australia, Japan, Singapore, New Zealand, Fiji, China and New Caledonia

BANKING, FINANCE AND INVESTMENT

FINANCIAL FACTS
Vanuatu’s economy is sustained for the major part by the agriculture industry, followed by fishing, offshore financial services, and tourism, which has been helped along by government-sponsored improvements to the infrastructure as well as new construction of hotels and resources for cruise ships.
Fiscal year: Calendar year

BANKING
Banking licenses come in two flavors - the Financial Institution License, which excludes checking accounts, and the Banking License, which includes checking accounts. To obtain a banking license of either kind, you must have proof of at least VUV15 million worldwide assets; proof of prior banking experience; references; and an extremely detailed business plan.

MEMBERSHIPS
ACCT, ACP, ADB, C, FAO, G-77, IBRD, ICAO, ICRM, IDA, IFC, IFRCS, ILO, IMF, IMO, IOC, ITU, ITUC, MIGA, NAM, OIF, OPCW, PIF, Sparteca, SPC, UN, UNCTAD, UNESCO, UNIDO, UPU, WFTU, WHO, WMO, WTO (observer)

FOREIGN INVESTMENT
Although Vanuatu encourages foreign investment, there really is no set scheme or incentive plan in place to further entice foreign investors, except for the fact that there is no income tax and no direct corporate taxation. The Vanuatu Investment Promotion Authority (VIPA) is the overseeing authority on all foreign investments. Foreign investors can proceed with their Vanuatu business only after being approved by VIPA.

IMMIGRATION

EMPLOYMENT
Highly skilled workers and high-level investors are granted work permits relatively easily. No other permits are given without it, except in the case of retired persons who show sufficient funds. Investors must show the level of capital they possess and are desiding to invest in Vanuatu.

RESIDENCE
The above-named workers also receive resident permits along with their work permits; otherwise, one can get a residency permit if there is proof of at least USD$104,000 in assets available and a minimum income of USD$3,000 per month. Residency permits can be granted for up to 15 years at a time, on a sliding scale from VUV20,000 for a one-year permit to VUV330,000 for a 15-year permit and a one-time processing fee of VUV30,000 and a yearly fee of VUV20,000. Repatriation bonds must be entered at the local bank of your choice

BUSINESS

BUSINESS ENTITIES
The most common by far of all Vanuatu company types that are not financial in nature are International Companies. Financial companies are incorporated as Exempted Companies. Tax breaks and regulatory considerations are in effect only if the companies in question limit their local business transactions to those which are necessary for the day to ay running of the company.

Business licenses are mandatory and are renewed yearly.

Within the framework of International Companies, one can form a Local Limited Company, an Exempted Company, an Overseas Company, or a Limited Partnership.

TRUSTS
Vanuatu trust law follows closely with UK trust law. You do not have to be a resident of Vanuatu to establish a trust; you do not have to register the trust; and you do not have to perform any scheduled reporting on the trust. The duration of a Vanuatu trust is 80 years.

TAXATION

There is no income tax and no corporate tax in Vanuatu.

DOUBLE TAXATION
There are no double tax treaty agreements between Vanuatu and other nations.