shell corporation

Information about shell corporation

For the oil company, see Royal Dutch Shell.


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 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, called transfer pricing, 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.

See also

Royal Dutch Shell plc

Public
(LSE: RDSA / RDSB )
(NYSE: RDS.A / RDS.B )
Founded 1907
Headquarters The Hague, Netherlands

Key people Jeroen van der Veer, CEO
Jorma Ollila, Chairman
Industry Oil and gas
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Limited company
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A tax haven is a place where certain taxes are levied at a low rate or not at all. This encourages wealthy individuals and/or firms to establish themselves in areas that would otherwise be overlooked.
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investment company is a company whose main business is holding securities of other companies purely for investment purposes. The investment company invests money on behalf of its shareholders who in turn share in the profits and losses.
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A front organization is any entity set up by and controlled by another organization, such as intelligence agencies, criminal organizations, banned organizations, religious or political groups, advocacy groups, or corporations.
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Economic policy
Monetary policy
Central bank   Money supply
Fiscal policy
Spending   Deficit   Debt
Trade policy
Tariff   Trade agreement

Finance
Financial market
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Transfer pricing refers to the pricing of goods and services within a multi-divisional organization, particularly in regard to cross-border transactions. For example, goods from the production division may be sold to the marketing division, or goods from a parent company may be
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For the television series, see Profit (TV series)
Profit generally is the making of gain in business activity for the benefit of the owners of the business.
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Oxfam International is a confederation of 13 organizations working with over 3000 partners in more than 100 countries to find lasting solutions to poverty and injustice.
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market is transparent if much is known by many about:
  • What products, services or capital assets are available.
  • What price.
  • Where.
This is a special case of the topic at transparency (humanities).
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worldwide view.


A holding company is a company that owns part, all, or a majority of other companies' outstanding stock. It usually refers to a company which does not produce goods or services itself, rather its only
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A front organization is any entity set up by and controlled by another organization, such as intelligence agencies, criminal organizations, banned organizations, religious or political groups, advocacy groups, or corporations.
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