Cook Islands

Named after Captain Cook, who sighted them in 1770, the islands became a British protectorate in 1888. By 1900, administrative control was transferred to New Zealand; in 1965 residents chose self-government in free association with New Zealand.

In recent years, the Cook Islands have developed into an offshore financial center - particularly with regard to trust law. Cook Islands trusts are governed by the International Trusts Act of 1984. International Trusts must have non-resident beneficiaries and, in most cases, a resident licensed trustee. If a settlor appoints a licensed resident trustee as custodian, the settlor may then appoint a managing trustee in his or her own jurisdiction. It is possible to re-domicile an existing trust in the Cook Islands if the trust appoints a licensed local trustee.

Cook Islands trust law does not recognize a rule against accumulation or rule against perpetuities. Accordingly, an international trust may accumulate income and assets indefinitely.

An International Trust deed may contain a choice of laws provision whereby different aspects of the trust may be governed by laws of different jurisdictions. A change in the governing law may also be triggered upon the occurrence of a specified event (also known as a "flee clause").

In addition to trust management, the Cook Islands are also a popular jurisdiction for insurance, and incorporation. In an attempt to complete with Nevis, offshore companies can be established under the International Companies Act (ICA). Shares in an International Company are not required to have a par value and may be denominated in multiple currencies. The ICA allows companies to issue bearer shares, repurchase shares, distribute profits to non-shareholders, and re-domicile in and out of the Cook Islands. The ICA permits company formation with a single shareholder. Only one director is needed and is not required to be a resident of the Cook Islands. However, the company must have a resident secretary who is an officer of a licensed trust company.

Offshore entities are not taxed by the Cook Islands, thereby ensuring tax neutrality. Furthermore, there are no reporting requirements for offshore entities.