# What is International Business Entity (IBE)?

Country: Guernsey

An International Business Entity (IBE) is a specific form of Guernsey company designed for use in international transactions and structures, introduced under the Companies (Guernsey) Law 2008. IBEs have certain restrictions (they cannot conduct business with Guernsey residents or own Guernsey land) but benefit from administrative flexibility. They are primarily used by non-residents for international holding and trading.

## Current rate (Annual)

0% corporate income tax (standard Guernsey rate)

## Example

A Hong Kong entrepreneur incorporates an IBE in Guernsey to hold shares in operating companies across Asia and Europe. The IBE has no Guernsey-resident shareholders or business activities in Guernsey itself, pays 0% corporate tax, and submits an annual validation to the Guernsey Registry.

## How International Business Entity (IBE) works in Guernsey

The International Business Entity (IBE) regime was created to provide a streamlined corporate vehicle for non-residents using Guernsey as a structuring jurisdiction. It is incorporated under Part XXVI of the Companies (Guernsey) Law 2008.

**Key restrictions on IBEs**
- Cannot carry on business with persons resident in Guernsey (except for professional services necessary to maintain the IBE itself)
- Cannot own or hold interests in real property in Guernsey
- Must have all beneficial owners who are non-resident in Guernsey (or entities owned by non-residents)
- The registered office must be provided by a licensed corporate service provider in Guernsey

**IBE vs standard Guernsey company**
| Feature | IBE | Standard Company |
|---------|-----|------------------|
| Business with Guernsey residents | No | Yes |
| Guernsey land ownership | No | Yes |
| Annual validation | Registry | Registry |
| Corporate tax rate | 0% | 0% |
| Substance requirements | If applicable income | If applicable income |

**Use cases for IBEs**
- International holding companies for non-resident entrepreneurs
- IP holding vehicles for royalty streams outside Guernsey
- Joint venture vehicles between non-Guernsey parties
- Securitisation and structured finance vehicles

**Substance considerations**
IBEs earning intellectual property income, finance and leasing income, or headquarter income must meet Guernsey's economic substance requirements under the Economic Substance (Companies and Limited Partnerships) (Guernsey) Law 2018. An IBE that fails substance requirements can be penalised and reported to the EU Code of Conduct Group or OECD.

**Annual filing**
IBEs must file an annual validation with the Guernsey Registry (similar to a confirmation statement in the UK) and a company tax return with the Revenue Service.

Source: https://www.guernseyregistry.com/article/1505/International-Business-Entities

## Related terms

- [Exempt Company (Guernsey)](https://accounts-os.com/gg/glossary/exempt-company-gg)
- [Corporate Income Tax (Guernsey)](https://accounts-os.com/gg/glossary/corporate-income-tax-gg)
- [Guernsey Registry (Companies Registry)](https://accounts-os.com/gg/glossary/guernsey-companies-registry-gg)
- [Economic Substance Requirements (Guernsey)](https://accounts-os.com/gg/glossary/substance-requirements-gg)