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Beneficial Ownership and Legal Persons in the Republic of the Marshall Islands

The Republic of the Marshall Islands (RMI) has a complex regulatory framework regarding beneficial ownership and legal persons. Here are some key points to consider.

Beneficial Ownership

In the RMI, there is no mandatory disclosure of beneficial ownership under the statutes. However, the FIBL Regulation requires declaration of beneficial share ownership, but it is not defined. Furthermore, there are no sanctions for false declarations.

The regulations for legal persons in the RMI are provided under several statutes:

  • The Business Corporations Act (BCA)
  • The Revised Partnership Act
  • The Limited Partnership Act
  • The Limited Liability Company Act

Collectively known as the Associations Law, these statutes provide the framework for establishing and operating domestic and non-resident domestic corporations, partnerships, limited partnerships, limited liability companies, foreign maritime entities, and foreign corporations authorized to do business in the RMI.

Registrars

In the RMI, there are two registrars responsible for registering different types of entities:

  • The Attorney General is responsible for registering resident entities.
  • The Trust Company of the Marshall Islands (TCMI) registers non-resident entities. To register as a resident entity, a foreign entity must meet the requirements of the Foreign Investment Business License (FIBL) Act and be registered under the Minister of Finance’s designated Register of Foreign Investments.

Access to Information

In the RMI, timely access to accurate and current ownership information may not be possible due to reasons such as non-resident companies/entities not keeping a copy of their share register in the RMI, requiring access through the mutual legal assistance process. The two Registrars make available the information they have to other competent authorities, including foreign competent authorities, and to the public upon request.

Trusts

The formation of trusts is governed by the Trust Act of 1994 and the Trust Companies Act of 1994. Only the Marshall Islands Trust Company (MITC) can form trusts, but it has been inactive since its formation. Despite this, trusts are recognized in the RMI, and the law on trusts is still valid and existing albeit unutilized.

Non-Profit Organizations

The non-profit organization sector in the RMI is governed primarily by:

  • The Non-Profit Corporations Act
  • The Cooperatives Act
  • The Counter Terrorism Act

Relevant provisions of the Association Law also apply. The Registrar of Corporations is responsible for registering and filing NPOs in the RMI, but due to staffing constraints, there is minimal supervision of the sector’s 100 registered NPOs.