Frequently Asked Questions from Customers
These questions and answers help clients make informed decisions about using nominee services by understanding both the capabilities and limitations of this international structuring tool.
Is this legal? Am I breaking the law by using a nominee director or shareholder?
Yes, using nominee services is completely legal in most jurisdictions, provided local legal requirements are met. Nominee directors and shareholders are a standard practice in international business structuring. It’s important to understand that legality depends on the purpose of the use. If a nominee service is used for legitimate structuring, confidentiality, or management optimization, it is legal. Using nominees to conceal illegal activity, money laundering, or tax evasion is illegal.
Will I lose control of my company? Will a nominee director be able to make decisions without my consent?
No, you retain full control. A Declaration of Trust and a power of attorney are entered into between you and the nominee director, which legally binds the nominee to act exclusively on your instructions. The nominee director has no right to make independent decisions on material matters. All banking transactions, contracts, and important decisions require your prior consent. This is clearly stated in the nominee services agreement.
How confidential is my information as a beneficial owner? Can third parties find out that I am the beneficial owner?
The level of confidentiality depends on the jurisdiction and international transparency standards. Currently, beneficial owner information is subject to disclosure to competent authorities (tax and law enforcement) as part of anti-money laundering (AML) and automatic exchange of tax information (CRS, FATCA) requirements. However, your data is not made public—it is protected from commercial competitors, unscrupulous partners, and the general public. A nominee service ensures confidentiality at the level of public registries, but does not exempt you from the obligation to disclose information to regulators.
Does a nominee service help me avoid taxes? Will I run into problems with the tax authorities?
A nominee service is NOT a tool for tax evasion. Under current international law, you are required to declare your assets and income in your country of tax residence, regardless of the use of nominees. Many countries participate in the automatic exchange of information, making attempts to conceal income ineffective and illegal. A nominee service can be used for legal tax optimization as part of international planning, but it always requires full compliance with tax laws and declarations.
Who is responsible if something goes wrong? Can the nominee director be held liable for my actions?
Legal liability is distributed as follows: the nominee director bears formal liability as a company officer, but the nominee services agreement contains indemnification provisions, under which you, as the beneficiary, indemnify the nominee for any losses incurred as a result of following your instructions. Actual economic and criminal liability for illegal actions always lies with the beneficial owner. Nominee providers thoroughly screen their clients and refuse to work with dubious projects precisely to minimize such risks.
How much does it cost? Are there any hidden fees?
The cost of nominee services depends on the jurisdiction, scope of services, and the provider’s reputation. Typically, an annual fee ranges from $500 to $5,000+ for a nominee director and $300 to $2,000+ for a nominee shareholder. It’s important to clarify all included services in advance: document signing, registered address, postal delivery, and limits on the number of documents signed. Additional costs may arise when opening bank accounts, conducting complex transactions, or urgently processing documents. A reputable provider will provide a transparent price list with no hidden fees.
How do you choose a reliable nominee service provider? What should you do if the provider goes bankrupt or disappears?
Choose licensed providers with a long history, regulated in reputable jurisdictions, and professional liability insurance. Check for trust licenses and membership in professional associations (STEP, IBA). Ask for references and read reviews. In the event of the provider’s bankruptcy, your company does not cease to exist—you have the right to replace the nominee director. All trust agreements remain in effect, and you can transfer the service to another provider or assume control of the company yourself.
Will I be able to open a bank account with a nominee director? Will the bank refuse?
Modern banks employ strict compliance procedures and are aware of the existence of nominee structures. Many banks are willing to work with such companies on the condition that they fully disclose the beneficial owners. You will need to provide the bank with proof of the beneficiary’s identity, documents on the source of funds, a business plan, and the ownership structure. Some banks may require the beneficiary to be present when opening an account. Refusals are possible, but with proper documentation and choosing the right bank, opening an account is feasible.
How do I terminate a nominee services agreement? What happens if I want to end the relationship?
Termination occurs in accordance with the contract, usually with 30-90 days’ notice. You have several options: replacing the nominee with another provider, appointing yourself as a director/shareholder, or liquidating the company. The provider is obligated to hand over all corporate documents and seals to you and ensure that the necessary nominee resignation forms are signed. It is important to promptly notify banks and registration authorities of any changes. Reputable providers ensure a smooth transition without disrupting your company’s operations.
Will using denominations harm my business's reputation? How will my partners and clients perceive it?
Perceptions vary by context and industry. Internationally, nominee structures are the norm for holding companies, investment funds, and intellectual property. However, in some industries (B2C, public companies), this may raise questions. It’s recommended to evaluate the specifics of your business: if transparency is critical to your reputation, it may be worth considering alternative solutions. When working with serious counterparties, be prepared to disclose information about beneficiaries as part of due diligence. The key is to use the nominee service for legitimate purposes and be prepared to explain this.
Will using denominations harm my business's reputation? How will my partners and clients perceive it?
Perceptions vary by context and industry. Internationally, nominee structures are the norm for holding companies, investment funds, and intellectual property. However, in some industries (B2C, public companies), this may raise questions. It’s recommended to evaluate the specifics of your business: if transparency is critical to your reputation, it may be worth considering alternative solutions. When working with serious counterparties, be prepared to disclose information about beneficiaries as part of due diligence. The key is to use the nominee service for legitimate purposes and be prepared to explain this.
