Shell (corporation)

Shell (corporation)

A shell corporation is defined in Barron's "Finance & Investment Handbook" as "a company that is incorporated, but has no significant assets or operations." Shell corporations are not in themselves illegal and they may have legitimate business purposes. However, they are a main component of the underground economy, especially those based in tax havens. They may also be known as "International Business Corporations" (IBCs), "Personal Investment Companies" (PICs), "front companies", or "mailbox" companies".

A classic tax avoidance operation is based on the buying and selling through tax haven shell companies to disguise true profits. The firm does its international operations through this shell corporation, thus not having to report to its country the sums involved, avoiding any taxes. Oxfam International calculates that the flux of money flowing out from developing countries and deposited in tax havens at $50 billion a year.

ee also

*Dummy corporation
*Transparency (market)
*Shelf corporation
*Holding company
*Front organization
*Alternative Public Offering
Categories of companies
Logos
Sears Roebuck and Company


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Look at other dictionaries:

  • shell corporation — see corporation Merriam Webster’s Dictionary of Law. Merriam Webster. 1996 …   Law dictionary

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  • shell corporation — noun a company that is incorporated but has no assets or operations • Syn: ↑shell entity • Hypernyms: ↑corporation, ↑corp …   Useful english dictionary

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  • Shell — may refer to * Animal shell, or exoskeleton, including those of molluscs, turtles, insects and crustaceans * Seashell, the shells of various marine animals, especially marine mollusks * Eggshell, the outer covering of a hard shelled eggAny more… …   Wikipedia

  • corporation — cor·po·ra·tion /ˌkȯr pə rā shən/ n [Late Latin corporatio, from Latin corporare to form into a body, from corpor corpus body]: an invisible, intangible, artificial creation of the law existing as a voluntary chartered association of individuals… …   Law dictionary

  • shell — [ʆel] verb shell out something phrasal verb [intransitive, transitive] informal to spend a lot of money on something, often when you do not really want to; =FORK OUT: shell out something for/​on • The insurance company refused to shell out for… …   Financial and business terms

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  • shell company — or shell corporation n. a company existing as a legal entity but having no significant assets, independent business operations, etc., often owned or controlled by another company and used for various, often illegal, purposes * * * …   Universalium

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