Declaration Of Beneficial Ownership In A Corporation Or: Fill & Download for Free

Equity refers to the ownership interest of shareholders in a corporation.Shares are units of ownership interest in a corporation or financial asset that provide for an equal distribution in any profits, if any are declared, in the form of dividends.Stock refers to a form of security that indicates the holder has a portion of ownership in a corporation. The capital raised by a corporation through the issue of shares entitling holders to an ownership interest.There is a very thin difference between these three terms. But in my opinion stock or equities can be beneficial if you invest in it wisely with proper research and analysis. However, you can also consult stock and commodity advisory company that provide accurate and profitable tips on the basis of technical and fundamental analysis of the market.

Nations like China could possibly survive and grow stronger from the experience of an American attack in the style of Shock-and-Awe against the government headquarters. Consider a war conducted similar to the War in Iraq 2003. The Americans could, hypothetically conduct an assault on its regime and topple it in the same way as we did with Iraq. For the Chinese, however, though the buildings may be hollowed, the offices remain. By this I mean that the political structure will remain and they have a ruling class, the Chinese Communist Party, with many who would be capable of filling several roles and replace others once they fall. Second, many of the offices are housed in culturally significant Chinese structures. Destroying any of these would not have the same effect as was the case with the Iraqi Baath Party Headquarters, a modern office building. Bringing down one of these key public works would likely only raise legions of embittered Chinese peasants. This attack would likely only cause a surge of Chinese nationalism from the impoverished majority, giving a profound dose of energy toward the fractured regime. Having a nebulous governmental body with a horde or high quality replacements, backed by the largest land army in the world, backed by a fanatical population, that just so happens to share thousands of miles of border with Russia and Afghanistan and an endless supply of arms is the worst case scenario for fighting an invasion against the Chinese mainland. The Americans couldn't win that fight any easier than the Chinese could win in the United States.A better scenario would be to challenge the Chinese military directly rather than attacking their government. A worse option would be to blockade the nation until economic and social pressures force a surrender. Both options leverage the United States' naval superiority. Assuming war is the name of the game, our Navy is still overwhelmingly more powerful than theirs, which it should be said before anything else, guarantees the rest of this answer never happens.The Sino-American WarTo begin, we need to say one thing very clearly; the Chinese have absolutely no chance of beating the Americans in a full out war similar to the re-envisioned World War II conflict, with hordes of Chinese troops landing in Oregon to conquer all the way to the Continental Divide. For reasons that will be clear later, China simply does not have the capabilities, either in manpower, diplomatic leverage, nor in naval power to defeat the Americans in a total war scenario. While, yes, the Chinese could deal a devastating blow to the United States at sea, and could push back any attempts at American invasion to the Chinese mainland, they do not have any capability whatsoever to achieve strategic gains through an actual conquest of American soil. Once they reach the overlapping shells of American missile defense and aerial bombings, any force they attempt to send would be sent to the bottom of the sea. In truth, the United States wouldn't prosper much better in an overland invasion, but as I will show, this isn't as meaningful to the Americans as it would be to the Chinese. The only hope of China would be to gain effect through military victories and in gaining permanent control of territory currently under the United States' umbrella of protection. This, however, wouldn't grant China the ability to cut off supply lines to the United States and could not enact the type of crippling economic pressure that they are susceptible to, a fact I will also show later.War for the PacificChina has been working prodigiously to grow its military capabilities in the sea. Its interests are to secure its territorial claims in the South China Sea and to project power throughout the region. It wants to dominate the Eastern Pacific through trade. They've attempted to do this by quickly acquiring many ships making headways into theoretical new technologies and approaches to naval warfare. China has been attempting a great deal of research into a lot of really powerful technologies, including ship destroying missiles and a fleet of submarines, they haven't reached the point that they have unquestionable dominance in even their own region, much less the rest of the world's oceans. They also haven't overcome many strategic barriers to ensuring that these new technologies are functionally capable of achieving victory at sea.Most of the Chinese Navy's strength lies in its submarine fleet, which are both older and fewer than what could be fielded against them in a Pacific war, disregarding all American and allied forces in reserve in the Atlantic and North Sea. Currently, the Chinese sub-surface warfare fleet is only 70% modernized. Many are simply bought from other forces, such as the Soviets after the Soviet Union collapsed. Among their modern forces, including their fleet of Song-class (Type 039) diesel-attack subs, the imbalance isn't from their capabilities, but from their engineering, according to a RAND corporation report and elaborated upon by a U.S. conference on the Chinese Navy’s capabilities at the U.S. Naval War College.One of the major structural weaknesses of the force is Chinese propulsion engineering, or the lack thereof, since the majority of engines used in Chinese subs are imported foreign technology, often license-built in the country.According to the conference host and Naval War College professor Andrew Erickson, propulsion engineering remains a work in progress in the PLAN’s underwater force:Here’s where things become more demanding for them (…) They’re going to want to be able to build a significant number of [attack submarines] whose reactors are efficient, long-lasting, reliable, and quiet enough. There’s no way to compensate for quietness if you don’t have it.China's requirement to produce so many of their most crucial systems through third party because of their own local expertise puts them at a drastically reduced technological curve, and also reduces their capabilities. From an engineering standpoint, these systems must be redeveloped to work together, rather than to be designed holistically. This also serves as a security risk, increasing the chances of their system's intelligence to be made available to others, namely, the American CIA. Licensing in this way would open the door to exploitation of weaknesses literally built into the Chinese fleet.Examples of China's new technological initiatives beyond submarine warfare is the Dong-Feng 21D. DF-21D is said to be the world's first anti-ship ballistic missile. United States Naval Institute in 2009 stated that such a warhead would be large enough to destroy an aircraft carrier in one hit and that there was "currently ... no defense against it" if it worked as theorized. Dubbed the "carrier killer" by media, many who only passively take in military studies have believed this will mean the end of the era of American carrier dominance, at least in the region directly surround China.More thorough readings of the literature, as provided by United States Naval Intelligence, shows that the system still has a few vital flaws limiting its true combat efficiency beyond the theoretical. This is outlined well by Forbes contributor, Loren Thompson.With China gradually pushing its maritime defensive perimeter out into the Pacific and deploying everything from nuclear-powered attack subs to anti-ship ballistic missiles, isn’t it just a matter of time before U.S. carriers have to retreat to a distance where their planes can no longer reach China?The answer to that question, it appears, is “no,” for at least four reasons. First, whatever weapons China may be buying, it lacks the sensors and command system to track and promptly target a carrier. Second, U.S. forces have multiple options for actively and passively impeding the effectiveness of any attack, including targeting forces ashore. Third, if a carrier actually were hit by anything less powerful than a nuclear weapon, it could absorb the damage and continue operating in some diminished capacity; it almost certainly would not be sunk. Finally, the U.S. Navy is taking numerous steps to enhance the flexibility and effectiveness of its aircraft carriers, enabling them to cope with whatever new capabilities the Chinese field.He elaborates on many of these points including the existence of anti-ballistic ships and attack submarines.[Aircraft carriers] typically are escorted by cruisers or destroyers carrying the Aegis combat system — the world’s most sophisticated air defense system — and nuclear-powered attack submarines. Since the carriers themselves are nuclear-powered, they are always moving and unconstrained by logistical needs.Can China Sink A U.S. Aircraft Carrier?A principle consideration to take from this article is the failings of Chinese target acquisitions and tracking. These leave so much to be desired that, it shouldn't be laughed out of consideration, that it is quite possible to miss with an atomic weapon. Another little known fact about the carriers as well, is that they are among the fastest ships in existence, contra to what one would assume from by them being the largest ships ever created. Their massive engines give them moving power to outpace most any other surface vessel. With lead time provided by the most advanced launch detection satellite detection in existence, a carrier group may have the means to escaped the deadliest area of effect, which would be required to sink rather than destroy the carrier, or to avoid its effects altogether. This obviously wouldn't be a permanent solution, but add this that it is suspected that China has, at max, 60 of these weapons to fight off seven American carrier fleets and China's odds favoring some new superweapon begin to dwindle.This is not to ignore the significance of the political risks involved in using a ballistic nuclear weapon, the likely counter strike that will incur from American launch capable submarines, and the fallout, figuratively speaking, that would follow. Geopolitically, this would throw the nuclearly armed world into chaos. Between the United States and China, it must be remembered that the US still vastly surpasses China in multiple means of delivery systems as well as dwarfing their total number of nuclear weapons.Though the loss of one of America's aircraft carriers would be a profound blow to the American psyche, abysmal as the question is, in a nuclear exchange between China and the United States, China would lose far more than a few ships of her surface fleet. Still susceptible to American attack submarines, likely other targets would be the Chinese Army, the largest military force in the world, and necessary for preservation of China in the event of civil unrest. The loss of a large enough percentage of the Chinese PLA would serve as far more than a spiritual defeat to the Chinese - it would be nothing less than an existential threat to the continuation of the Chinese civilization.Chinese technologies, even if they are lacking the crucial layers of guidance or engineering cohesiveness to work on the level envisioned, are both innovative and impressive to the point that China is quickly becoming one of the world's most powerful nations. Their handful of advanced technological capabilities, which themselves vary in realistic strength and effectiveness, however, don't aid China enough to overcome the massive gulf of power difference that exists between the United States Navy and any other world power. To make this clear, China has announced a plan to double the size of its carrier fleet. This will improve the Chinese carrier forces to only being one thirteenth the size of the United States. I'm not trying to be insulting, this is just stating fact.What's more, the Chinese Navy wasn't built specifically to deal with the American Navy, but to serve as a force to check the Japanese fleet, the South Koreans, the Russians in the Pacific and all other East Asian potential forces. The reason behind the existence of the the Chinese military is to gain and strengthen Chinese regional supremacy, rather than to make a force able to beat the Americas. These other forces are going to have to be considered in the question.It will be a tough and anxious fight. I would be surprised if both sides didn't lose greatly, but a fight between the United States military and that of the Chinese is one the Chinese can't win, especially considering the fact that any American offensive will include a Japanese alliance, most likely bring in the Australians, with the possibility of inclusion of the South Korean forces, as well. Given this reality, the Chinese navy would eventually be crushed if they insisted on a prolonged fight or even one which could only last a couple of days.Following direct fighting, and the destruction of the Chinese Navy by an alliance of Pacific powers, China would very quickly face a radical shift in management of their regime. Such an inevitable failure would signal an incompetence in the Chinese leadership unimaginable. This could force a change of power through the appointment of different factions of the CCP to head the crucial chairs of governing power, or perhaps the abandonment of the Chinese Communist Party to internal reforms. This is if the Chinese PLA is not destroyed in the event of a nuclear exchange. They would be necessary in such a crisis to keep order so that the population doesn't plunge the nation into utter chaos. If China were to hold out and attempt a long run strategy, or if they were to attempt to sink United States carriers with nuclear weapons, this option would include the destruction of literally billions of lives with massive economic restructuring across the world. The better option would be to quickly show the Chinese that they cannot win such a war, reduce their means and willingness to participate militaristically and allow their economy to continue.Economic WarfareThe reason a direct attack on the Chinese Navy is the better option is that the second best option is to completely destroy China's economy, their ability to make war, by attempting to not engage in a quick, bloody fight. Realism would say that this is the best option for the Americans, placing their carrier fleet in less risk, along with the American lives onboard, though even in the long run, the complete desolation of China to internal collapse hurts the United States, not to mention the world, more than the risk of fighting a hard quick war. What follows is why.The Chinese economy requires monumental growth to continue to maintain governmental legitimacy. We've already seen the end of their miraculous boom with the recent Chinese Stock Market Collapse, which, if nothing else, proved that the Chinese markets aren't capable of maintaining the 7% growth they needed to hold without dangerous artificial mechanisms propping up their economy.Couple this with resounding income and wealth inequality in China, and you see a China which teeters dangerously on the edge of instability, even beyond the realm of hypothetical questions such as this. While the perception of China's rise to wealth is one of all Chinese universally being pulled from the dredges of post World War II oppression, the reality is one of incredible inequality, where most of the wealth is now being directed toward the heirs of party leadership during those formative years of the Chinese Communist Party. The Chinese economy is becoming the largest in the world, yet in spite of this, more than four-hundred million of their people still live in abject poverty. Any decline in growth will result in a decline of the living standard for all Chinese. For the rest of China, including the 93% of the population not entitled to privileges granted by being members of the CCP, when you already function on the extreme low margins, such as this impoverished majority, any threat to the economy is a threat not just to your current standard of living, but to your survival. You just can't take ¥1000 away from the coffers of someone who only makes ¥10,000 a year. It isn't just a reduction of 10% when you were already where you only just barely were surviving. When we deal with the sheer volume of humanity that is ever present in Chinese discussions, such an event would pose a real threat for the current ruling regime. To suffer economic collapse would mean a revolution the likes that CCP could not withstand. At that point, the only thing that would keep the country together would be the People's Liberation Army.Having made that clear, returning to the naval war, let's consider embargos. Who would be most hurt by this; American's needing to switch their producers of iPads, or the Chinese completely reliant on Western trade and import of raw materials from overseas? We've already discussed the Americans, along with their allies' overwhelming military advantage, so rule of the seas would remain with American political leadership. The global presence of their forces means that, while the Chinese fleet will have to secure numerous positions with relatively few forces to do so, the Americans, alone or with their allies, could potentially block off many layers of the Chinese import/export economy by parking carrier fleets outside the Strait of Hormuz, in Singapore, off the coast of South Africa, by augmenting Taiwan's forces, and still have carriers to spare for maneuvering and to function for other security threats in Europe.Tabling specifics on all other industries, let's focus on China's energy sector, the driver of their economic boom, and the most clear display of China's economic crutch and the stranglehold an economic embargo would have on it. Most of China's energy usage can be summed up in this graph.The oil, accounting for 19% of Chinese energy needs, along with most of its transportation fuels, can be easily cut off at the Gulf of Hormuz by the United States 5th Fleet housed in Bahrain. Coal is a different story. With coal, the number one economic partner is Australia, serving as China's supplier for more than half of their their coal needs and thereby, more than a third of China's total energy supply.I don't suspect that Australia would be extremely pleased to discover their two most massive economic partners just went to war overnight. The question should be asked then, "what would Australia be able to gain from an energy embargo against China?" How could they make up for the monumental loss to their own economy? In most cases, this would be the end of the discussion, except that there is another power, which, in the absence of China, would like very much to the take over as the region's dominant manufacturing economic power.India and the Sino-American WarIndia's growth in the last two decades has seen drastic transformation in the communications and technology sectors have driven a rise to that nation that took the rest of the world by surprise. They serve as a second massive power in the region, but one forced to exist in the shadow of China for the foreseeable future. Between the two are an impossibly large mountain range, along with thousands of miles of either inhospitable desert or impassable jungle terrain. For this reason, direct conflict, along with direct partnership between the two are incredibly limited, ensuring a level of peace in the world's most populous extend region. The two great powers exist, however, in a monumental tug-of-war for external resources. In this competition, India is almost always the loser to Chinese dominance in global trade due to their mature industrial and manufacturing capabilities. India wants to be an industrial power, knowing that there are few better routes for them to gain international relevance on the world stage. They also long for the means to be able to politically dominate the region of the Indian Ocean, including their long standing local enemy, Pakistan. China, however, will never allow India's billion people to compete with their own in this regard.For that reason, a war between China and the United States would benefit no one more, with the exception of perhaps Japan and one other, than India. India would gladly soak up Australian coal surpluses in the event of such a monumental supply being created. Along with this, India would love to deal with the hundreds of thousands of suppliers and international manufacturers being forced to find a new manufacturing superpower to produce their low end goods in bulk. Leveraging India's recent surge in technology and engineering, they may even be able to direct this evolution into high tech sectors better than even the Chinese did, moving from the level of low end goods, to high end electronics in only a matter of years instead of decades. Along with what amounts to the largest sale in history by way of Australian coal, India would likely see the largest boom to its economy the world has ever seen.Of course, a sudden rise in the power of India comes with it the unavoidable risk of conflict with Pakistan. For that reason, as India's economy surges, it's military will be focused more and more to their Northwest. They will have the incentive to begin operations in Afghanistan in earnest, because of Afghanistan's ability to quickly destabilize Pakistan. Upon encroachment, Pakistan may feel a conflict is necessary to preserve their own future security. This conflict could likely pull the rest of the Middle East into a prolonged conflict with India years after the Sino-American War. That, however, is beyond the scope of this question.Returning to the subject of a war between China and Asia, India is poised to take over where China would fall. Geographically and economically, it has the means to do for the world what China currently is. In the event of a major Chinese conflict, resources currently being bought up by them could very easily find clients in India - switching the role of the dominant economic power in Asia. This time, it would likely be China which could never overcome the shadow of the new reigning local economic force.Japan and the Sino-American WarJapan's role can't be ignored in the conflict either. Currently, they are seeing their economic roles challenged more and more by the Chinese. As an island nation, Japan could not compete with China in manufacturing anything other than high-end equipment, and their fate is tied to naval trade for the good to create it. For this reason, the Chinese movements into broadening their own sphere of economic influence has served as a bone in the throat of Japan. Conversely, as the Pacific Rim countries continue to develop, the competition for trade in the Pacific places Japan at an advantage for the future of trade due, again, to its geography. This competition, which will only grow in the future, also exists fully realized in the real world irrelevent to a hypothetical war with the United States. This negative energy has showcased itself in increased racial tensions between the Chinese and the Japanese, resurrecting a resurgence in Chinese resentment towards the Japanese because of the actions taken by Japan's Imperial Forces in China nearly a century ago. A future where China no longer threatens Japan economically would see Japan incentivized to do whatever was necessary to aid an American assault against the Chinese, not so much with the intent of aiding the Americans, but to reduce the influence of the Chinese.Europe and the Sino-American WarThe United States would likely find few supporters for such a conflict as is the subject of this question from its traditional allies in Europe. Geopolitically, powers like France and the UK have little to gain from seeing a collapse of China and much to lose, which I will discuss shortly. Russia, however, would very much favor it.The economics of Europe center on a few key elements where the United States are concerned. First, and foremost, preservation of the global commons, in this case the continuation of trade falls almost primarily on the shoulders of the Americans. For that reason, destroying trade networks established between the European Union and China, is in direct contradiction to this. The seven hundred million living throughout Europe would each feel the strain of this trade collapse and would see no new options until India comes online as a global manufacturing power. In some cases, they would be forced to attempt to rebuild old relationships with their once colonial territories in Africa. For nations like France in Algeria, this may be a fruitless endeavor.Until that point, economic power in Europe will shift from overseas to the manufacturing powers in Europe currently, Germany and Russia. Germany and Russia share a tenuous geopolitical alliance already. Germany is a power in technology, finance, and manufacturing, whereas Russia has vast resources, including energy resources, and military strength. Russia benefits from German technology and wealth, while Germany requires Russian energy to survive at its current level of output. In this case, Germany is currently the weaker of the two nations of the de facto economic alliance since Russia could find other means to gain technology, but Germany is enthralled to Russian energy. In the future, their relationship may grow much, much closer to the point that a Russo-German entente could destabilize the balance of power in Europe.This is a threat to Western Europe beyond Germany. France and the UK would openly attack the move toward an American War in Asia on moral grounds, when really, their aim is to keep American forces entrenched in NATO, the blanket of security which has provided Europe with the prosperity it has enjoyed since the end of World War II. With America distracted abroad, actors such as Russia would likely maneuver to regain their former sphere of influence under the former Soviet Empire. This happened before in 2004 with the Russian invasion of Georgia, and again with the almost unchallenged Ukrainian Civil War, caused by Russian interference in 2013. France and the United Kingdom would be left to push the Germans into maneuvering the Russians diplomatically while they attempt to leverage the Russian military with the relatively minor forces they control for deployments across all of Europe.For this reason, Russia is benefitted by a prolonged war between China and the United States without directly being involved. How this would manifest would be in trying to destabilize China in whatever means it had possible.The Best and Worst Case Scenario for the Sino-American WarThe greatest outcome would be for China to realize upon the loss of their naval forces, that economic collapse was inevitable, bringing about their surrender quickly. Within the first few weeks, they would suffer such massive economic crises that they would reasonably sign over some forms of surrender with little loss of life and the maintenance of a working Chinese government. The worst case is a prolonged conflict. The government could attempt to nationalize enough business to keep themselves afloat during this period with the attempt to make the economy as efficient as possible in the short run for the purposes of winning the war. While they would be doing this, they will have lost the loyalty of both the wealthy elite and the half a billion poor Chinese who either live in extreme poverty or worked in the closed down factories. From here, the nation would see a period of intense internal strife that could descend into the kind of conflict we saw in Syria, also a victim of Russian meddling.What prevents a large scale popular uprising in China is the People's Liberation Army. This is true even today, complete absent any military encouraged by international superpowers. It must be remembered that China's majority currently enjoys little democratic representation because of a single party system consisting of less that 7% of the population. The majority also exists primarily in abject poverty with high unemployment. For this reason, China or more precisely, the Chinese Communist Party, has the largest Army in the world, the People's Liberation Army. Due to the many failings between its branches, namely in the way that the PLA can't adequately communicate between the Chinese Navy, it becomes more and more obvious that the PLA was never intended to be a force meant to fight foreign wars in the name of China, but to stand ready to put down civilian uprisings within her own borders.China is aided in its internal security by the outlawing of weapons to the civilian population. Gun ownership in the People's Republic of China is heavily regulated by law. Generally, private citizens are not allowed to own guns with the exception of law enforcement, the military and paramilitary, and security personnel protecting property of state importance. Civilian ownership of guns is largely restricted to authorised, non-individual entities, including sporting organisations, authorised hunting reserves and wildlife protection, management and research organizations. The chief exception to the general ban for individual gun ownership is for the purpose of hunting. Illegal possession or sale of firearms may result in a minimum punishment of 3 years in prison and penalties for arms trafficking include death.- Overview of gun laws by nationThis imbalance of civilian power and privilege, coupled with the economic hardship of a naval blockade would normally be the kind of event that would be perfect to transition a hostile regime into one more friendly to a conquering power. The problem for the Americans, is that China cannot be conquered any more than could the Americans themselves. In fact, the Americans could never set foot on mainland China. There is simply no way an American landing force could invade with the kind of power necessary to beat back the waves of Chinese military and paramilitary forces. This is coming from a United States Marine, so understand the sincerity. No landing force could ever succeed in China by the Americans, or anyone else.It also isn't possible for the Americans to be able to do much in the way of arming any rebels who might be beneficial to the American cause. The geography of China along its borders makes it unsuitable to smuggle in millions of weapons and armaments to fight a prolonged civil war against the Chinese PLA. An internal collapse of China would be slow and come at the cost of many millions of innocent Chinese lives. In the end, such an outcome would probably end when the Chinese PLA, itself atrophied from desertion due to lack of confidence in the CCP, not to mention not being not being paid, would be forced to coup, replacing the Chinese government. The risk with this is that the mostly economic leaders of the nation would be replaced with military leaders holding the same offices of civilian political power. The nation that most closely resembles this today, is North Korea.The war, or more precisely, the insurgency that absolutely no one wants save one party, can be made worse by said party - the Russians. The Russians, as I said before, are incentivized by American forces tied up in East Asia for them to pursue goals in Europe. The Russians have the almost singular strategic advantage to a Chinese insurgency in that they have a massive number of arms and one of the longest borders in the world whereby they could funnel them. Russian arms can flow to whatever force the Russians want that would award them a strategic leg in the region following the end of the war. This would mirror the strategy of Soviet communists and the Chinese Communist Party against the Chinese Imperial forces during and after World War II. North Korea, once again not to be forgotten, also has this capability, but less so than the Russians.Russia gains a second advantage from the prolonged conflict in China strategy. Being the most powerful and most secure nation remaining in the region, Chinese refugees would flood north over the Russian border in the largest flight of humanity the world may have ever known. With the embargos still in place, Chinese refugees would become the largest Chinese export. Russia, as it turns out, would greatly benefit from this influx in much the same ways the Germans will eventually from the European Refugee Crisis. Russia suffers from a declining population. This means that soon, they will not have the population of workers needed to supply their ageing population.Because they haven't maintained the required 2.1 births per woman to hold a stable population, they will need to find a source for new blood. In the case of a Chinese collapse, Russia would be drastically infused by a new population of workers capable of manning Russian factories, Russian mines, the Russian military, and in a few years birth a new generation of ethnically diverse second-class Russian citizens.For that reason, in the worst case scenario, one which would cost the lives of millions of Chinese, the compromise of security throughout all of Europe, the disruption of trillions of dollars of the world economy, the winner of a war between the United States and China would most likely be none other than Russia, an outcome they would surely seek to ensure.More like this:Given that China is fine without blue-water navy, why does the US need one?How vulnerable are the US aircraft carriers and battle groups to enemy attack?In the event of a US - China military conflict, how would the fact that the Chinese military has virtually no combat experience affect the outcome?Liked this? You might also like my YouTube Channel. You can also connect with The War Elephant on Facebook. If you want to help me make more content like this, please visit my Patreon Page to find out more.

Hello Buddies, so the whole world is hit by the word "Panama Papers". We have analysed the topic and presented in FAQs. Hope you will get all your answers.1. What are the 'Panama Papers'?The 'Panama Papers' are a set of confidential documents leaked from one of the biggest law firms of Panama - 'Mossack Fonseca'. The Panama Papers provide information about thousands of offshore entities, identities of their shareholders and directors. It listed various world leaders, public officials, billionaires, celebrities, sports stars and politicians.2. How much data has been leaked and by whom?a) The leaked data consists of 11.5 Million Documents in around 2,600 GB taken from the Mossack Fonseca's internal database by one of its employees.b) These documents were obtained by Sueddeutsche Zeitung, a daily newspaper headquartered in Munich, Germany. Sueddeutsche shared the Panama Papers with the Washington-based International Consortium of Investigative Journalists (ICIJ) and other news outlets, including the BBC, the Guardian and the Indian Express.c) Sueddeutsche mentioned that an employee at the law firm had leaked the data, telling the newspaper that he had risked his life in doing so.3. What does the Panama Papers reveal?a) The Panama Papers contain information on 2.15 lakhs offshore entities connected to people from more than 200 countries.b) The leaked data covers nearly 40 years period from 1977 through the end of 2015.c) It reveals the database of individuals who have set-up offshore entities through the Panama law firm.d) These individuals are either holding direct ownership or indirect ownership (beneficial ownership) in the offshore entities.e) Some of the Indians have also floated offshore entities at a time when foreign exchanges laws of India did not allow them to do so.4. What is the authenticity of documents leaked?Ramon Fonseca, one of the co-founder of the Mossack Fonseca, confirmed the authenticity of the papers being used in articles published by more than 100 news organizations around the world. He told to one of the Panama's news channel that the documents are real and were obtained illegally through a hacking method.5. Who is 'Mossack Fonseca' and what is its role in this entire controversy?a) Mossack Fonseca & Co. is a law firm and corporate service provider based in Panama with more than 40 offices worldwide.b) It specializes in commercial law, trust services, investor advisory and international structures.c) It provides services like incorporating companies in offshore jurisdictions, wealth management, private banking, accounting services, etc.d) This law firm is one of the seven firms that collectively represent more than half of the companies incorporated in Panama.e) It also provides assistance in transferring funds, buying property, setting-up trusts or signing agreements with entities.f) Mossack Fonseca plays a crucial role in incorporating entities in tax havens. It had incorporated 14,658 active companies in Panama till August, 2013 out of which 4,646 companies were incorporated without providing any information about their shareholders.6. How entities incorporated in Panama provide secrecy about the beneficial owners?a) Panama offers the most favorable and most flexible company incorporation laws available in the world. Private Interest Foundations are also available, and are one of the most widely used estate planning structures in the world today.b) Panama is the registered domicile for over 400,000 corporations & foundations, making it one of the most popular jurisdictions in the world to incorporate.c) Panama does not impose any reporting requirements for non-resident Panamanian corporations.d) Panama does not allow "piercing the corporate veil".e) Panamanian corporations share certificates can be issued in Nominative or Bearer form (anonymous form of ownership), with or without par value.f) Panamanian Companies can have directors, officers and shareholders of any nationality and resident of any country.g) The offshore entity in Panama need not appoint natural persons as directors or have individuals as shareholders.h) Neither the directors nor the officers of Panamanian corporations need to be shareholders. Meetings of directors, officers, and shareholders may be held in any country and accounting books may be kept in any country.i) It is not necessary for the interested parties to be present in Panama for the purpose of establishing a corporation. Corporations conducting business outside of Panama do not require a commercial license for offshore business activities.j) Registered Panamanian Agents offers its own executives to serve as shareholders or directors. Sometimes an intermediary law firm or a bank acts as a director or a nominee shareholder. So the real beneficiary remains hidden.k) The registered agent provides an official overseas address, a mail box, etc., none of which traces back the entity to the beneficial owner.7. What are the key advantages of incorporating a Panamanian Company?a) The incorporation process is fast and can be achieved in 3 days.b) The identity of the shareholders is not publicly available.c) Nominee and bearer shares are allowed.d) There are no currency restrictions although the US dollar is regularly used.e) The transfer of shares can be done freely, which facilitates the transmission of assets in a confidential manner.f) The shareholders, directors and officers can be of any nationality and residents of any country.g) Meetings can be held in Panama or in any jurisdiction, subject to tax advice.h) Accounts do not need to be held in Panama.8. What are Panama foreign exchange rules?a) Panama's circulating currency is the US Dollar, and Panama has no currency exchange controls or currency restrictions, so funds can flow in and out of the country freely.b) Panama uses the U.S. dollar as its legal currency, instilling tremendous fiscal and monetary discipline while keeping inflation very low - under 2 percent for the last 40 years.c) Panama has no restrictions on monetary remittances abroad, including dividends, interests, branch profits and royalties. No restrictions on funds flowing in or out of the country.d) A dollar economy insulates Panama from global economic shocks. During the Asian monetary crisis of 1998, Panama became one of the healthiest economies in Latin America.9. How secure is banking infrastructure of Panama?a) Panama is one of the most secure offshore financial center - where privacy and confidentiality is vigorously protected by constitutional law.b) Panama offers the best bank secrecy and corporate book secrecy laws in the world.c) Panama has no provision for "piercing the corporate veil".d) Revealing banking information to third parties is a crime, punishable by prison.e) Panama has no mutual legal assistance treaties (MLAT's) for sharing of banking information with any other nation and does not recognize court rulings from other countries.f) Panama City is home to the second largest international banking center in the world next to Switzerland. Panama has the most modern and successful international banking center in Latin America, with more than 150 banks from 35 different countries.g) Approximately 150 international banks are located in Panama. Total assets in Panamanian banks are over US$150 billion.h) Some of the banks present in Panama's banking center are: Citibank, HSBC, Dresdner Bank, Bank of Tokyo, Bank of Boston, Banco Nacional de Paris, International Commercial Bank of China, Societe Generale, Banque Sudameris, BBVA, Banco Uno, Banco General, PriBanco, Banco del Istmo, Global Bank, MultiCredit Bank, PanaBank, ABN Amro, Banco Aliado, Banco Continental, BancoLat, BIPAN, Lloyds TLB Bank, Bank of Nova Scotia BIPAN, Bank of Nova Scotia, and much more.10. Why an offshore company is incorporated in Panama or other tax havens?a) Shell Companies are non-operational companies. These are legal entities having no independent operations, significant assets or employees.b) It is not time consuming or expensive to establish anonymous shell corporation. Agents charge fees of $800 to $6,000 as upfront cost and an annual charge for formation of companies and other additional services such as nominee director arrangement or annual documentation.c) The two big draws that offshore entities in jurisdictions such as British Virgin Islands, Bahamas, Seychelles or Panama offer are: secrecy of information relating to the ultimate beneficiary owner and zero tax on income generated.d) In fact, in Panama individuals can ask for bearer shares, where the owner's name is not mentioned anywhere. Besides, it costs little or nothing to set-up an entity abroad.e) The Registered Agent charges a few hundred dollars to incorporate an entity. It doesn't take much time to incorporate one either. Companies are available off-the-shelf and can be registered in a couple of days.11. What is the purpose of creating "Shell Companies"?Generally, Shell Companies are used to hide the real identity behind creators or buyers of assets. These are not established to pursue a legitimate business but to obscure the identity of beneficial owners.By utilizing an offshore company, it may be possible to secure a number of advantages. The motivations for individuals and corporations to utilize offshore planning and offshore companies include following:a) Have low tax in the country of residenceb) Anonymity of the shareholders or directors so as to shield private assets from third parties.c) The compliance reporting requirements for offshore companies are limited, as most offshore shell companies are not required to file annual reports and accounts in the jurisdiction of the company formation.d) Registering an offshore company requires minimal capital, usually less than what is required for an onshore registration. In certain jurisdictions there is, in fact, no capital needed for registration.e) Offshore companies are regularly utilized to own property and real estate. In addition to confidentiality, the benefits and advantages they offer include exemption from certain types of taxes.f) Offshore companies are very often used for share or foreign exchange transactions. The main reasons being the anonymous nature of the transaction (the account can be opened under a company name) and little or no tax levied on profits made.g) Capital gains arising from the disposal of particular investments can be made without taxation. In the case of dividend payments, lower withholding taxes can be achieved through the use of a company incorporated in a zero or low tax jurisdiction that has double tax agreements with the contracting state.h) Companies wishing to invest in countries where a double tax agreement does not exist between both countries can establish an intermediary company in a jurisdiction where there is a suitable treaty.i) Intellectual property including patents, trademarks and copyrights can be owned by, or assigned to an offshore company upon acquisition of the rights. The rights can then be franchised to companies around the world and the resultant income can be accumulated offshore.j) Individuals who provide professional services, such as consultants, entertainers, aviators, film executives, etc., can realize considerable savings by accumulating fees in offshore entities.k) Internet traders can use an offshore company to maintain a domain name and to manage internet sites.12. Is incorporating an overseas company allowed?RBI has permitted resident individuals to remit up to US$ 2, 50,000 abroad per year for any purpose under the Liberalised Remittance Scheme (LRS). Under LRS, Indian residents were permitted to acquire immovable properties or shares or any other asset outside India.In the year 2010, RBI clarified that the LRS scheme only allows residents to purchase shares outside India and it does not allow setting-up a company abroad. Thus, companies incorporated abroad during this period were considered as having violated FEMA.From 2013 onwards, RBI allowed a resident individual (single or in association with another resident individual or with an 'Indian Party') satisfying the prescribed criteria, to make overseas direct investment in the equity shares and compulsorily convertible preference shares of a Joint Venture (JV) or Wholly Owned Subsidiary (WOS) outside India.13. What is Liberalised Remittance Scheme?Under the Liberalised Remittance Scheme all resident individuals, including minors are allowed to freely remit up to USD 2,50,000 per financial year (April – March) for any permissible current or capital account transaction or a combination of both. If an individual remits any amount under LRS in a financial year, then the applicable limit for such individual would be reduced from USD 250,000 by the amount so remitted.Limit under LRS schemeYearLimit[2004] $25,000[2006] $ 25,000 to $50,000[2007] May $50,000 to $ 1,00,000[2007] September $100,000 to $ 2,00,000[2013] $ 2,00,000 to 75000[2013] $75000 to $125000[2015] $125000 to $ 2,50,000There are no restrictions on the frequency of remittances under LRS. However, the total amount of foreign exchange purchased from or remitted through all sources in India during a financial year should be within the cumulative limit of USD 2,50,000.Once a remittance is made for an amount up to USD 2,50,000 during the financial year, a resident individual would not be eligible to make any further remittance under this scheme, even if the proceeds of the investments have been brought back into the country.14. What are the prohibited items under the LRS Scheme?The remittance facility under the Scheme is not available for the following purposes:a) Remittance for any purpose specifically prohibited under Schedule I (i.e., purchase of lottery tickets, prohibited magazines, etc.) or any item restricted under Schedule II of FEM (Current Account Transactions) Rules, 2000.b) Remittance from India for margins or margin calls to overseas exchanges/overseas counterparty.c) Remittances for purchase of FCCBs issued by Indian companies in the overseas secondary market.d) Remittance for trading in foreign exchange abroad.e) Capital account remittances, directly or indirectly to countries identified by the Financial Action Task Force (FATF) as "non- cooperative countries and territories", from time to time.f) Remittances directly or indirectly to those individuals and entities identified as posing significant risk of committing acts of terrorism as advised separately by the Reserve Bank to the banks.15. Can a person resident in India hold assets outside India?a) A person resident in India is free to hold, own, transfer or invest in foreign currency, foreign security or any immovable property situated outside India if such currency, security or property was acquired, held or owned by such person when he was resident outside India or inherited from a person who was resident outside India.b) Further, a resident individual can also acquire property and other assets overseas under the Liberalised Remittance Scheme.16. Is it illegal to invest in foreign countries or acquire foreign assets?Rule 3 of the FEM (Acquisition and Transfer of Immovable Property outside India) Regulations, 2000 restricts acquisition or transfer of immovable property outside India without general or special permission of the Reserve Bank.17. In which circumstances a person is allowed to invest in foreign companies or acquire foreign assets?An individual person resident in India may acquire immovable property outside India or invest in companies outside India:a) by way of gift or inheritance from prescribed personsb) by way of purchase out of foreign exchange held in Resident Foreign Currency (RFC) account maintained in accordance with the FEM (Foreign Currency Accounts by a Person Resident in India) Regulations, 2000.A company incorporated in India having overseas offices may acquire immovable property outside India for its business and for residential purposes of its staff in accordance with the direction issued by the Reserve Bank of India from time-to-time.As per Sec. 186 of the Companies Act, 2013, a company can't make investment through more than two layers of investment companies. However, a company can acquire any other company incorporated in a country outside India if such other company has investment subsidiaries beyond two layers as per the laws of such country.18. What are offshore accounts?a) Offshore bank accounts are located outside a person's country of resident, usually in a 'tax haven' because of financial and legal advantages.b) Companies or trusts can be set-up in offshore locations for legitimate uses such as business finance, amalgamation or merger and tax planning.c) However, these accounts are being used to avoid tax. The secrecy they provide make them attractive to corporates and high-income earning individuals who wish to conceal the sources of their funds or to evade payment of taxes.19. Will regulators be interested in Panama Papers?a) Non-disclosure of an overseas assets by resident individuals or companies or other legal entities will be of interest to Indian authorities and regulators.b) Floating these companies could also violate following laws, individually or jointly:■ Foreign Exchange Management Act■ Prevention of Money Laundering Act■ Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act■ Prevention of Corruption Act■ Income-tax Act■ SEBI Act■ Companies Act20. How Panama Papers will be relevant under Anti-Black Money Act?a) With increased globalisation and economic liberalisation, there has been manifold increase in cross-border transactions. This has also resulted in increased opportunities for avoiding tax though use of tax havens. The main objective of the Anti-Black Money Act is to tax the undisclosed foreign income or asset of a person resident in India.b) The Anti-Black Money Act came into force with effect from 01-07-2015. This Act is applicable to all persons resident in India (not being 'not ordinarily resident'). This Act has been enacted to tax the foreign income and assets (including financial interest in any entity located outside India) of a resident individual which were not declared earlier to the tax authorities.c) If information leaked in the Panama Papers provides evidence that Indian residents did not declare their foreign income or foreign assets in their return of income or under Voluntary Disclosure Scheme, they shall be taxed at a flat rate of 30%. The penalty for such suppression of income or asset shall be equal to 3 times of the amount of tax payable thereon. Further, there shall be rigorous imprisonment from 3 years to 10 years for such tax evasion.21. What action can CBDT take on basis of these leaked documents against persons involved?If the persons named in the leaked documents have not disclosed their financial interest, income or assets in overseas entities, CBDT can take following action against them under Income-tax Act:a) A notice can be issued under Section 147 or Section 143(2).b) Survey under Section 133Ac) Search and seizure under Section 132d) Can call for information under Section 133e) Imprisonment of minimum 6 months which can be extended to 7 years with fine.f) Penalty of 100% to 300% of tax evaded.g) Transfer pricing provisions can be invoked in case of under-invoicing or over-invoicing, etc.22. When income or asset shall be deemed to be un-disclosed one?All ordinary residents filing return of income for the financial year 2011-2012 and subsequent years were required to disclose their foreign assets and income earned outside India, even though they were not liable to file their returns. If resident individuals have not disclosed the following information in their returns of income, it shall be deemed to be un-disclosed:a) Details of income earned outside Indiab) Details of Foreign bank accounts and peak balance of that account.c) Details of foreign interest in any entity with total investment in rupeesd) Details of immovable property with total investmente) Details of concerns in which the person have signing authorityf) Details of any other overseas assetg) Details of trust in which individual is a trustee23. Requirement to disclose the foreign assets to the RBI?Annual return on Foreign Liabilities and Assets ('FLA') has been notified under FEMA 1999. It is mandatory to submit the returns by all the Indian companies which have received FDI and/or made overseas investment. Non-filing of the returns before due date will be treated as a violation of FEMA and penalty may be invoked for such violation.Website: www.taxmann.comPS: FAQs are in context of Indian rules and regulations