An international business company (IBC) is a corporate entity that is not allowed to engage in business in the jurisdiction where it is incorporated. It can only engage in “international business”, and not in domestic business. It is usually an untaxed company that is also not required to file accounts and annual returns.
When people talk about an offshore company they are usually talking about an IBC. IBCs are usually incorporated in an offshore financial centre which is “offshore” from where the owners are. The IBC then also operates “offshore” as well, that is, in other jurisdictions and not where the IBC is incorporated.
A number of jurisdictions offer IBCs and IBCs vary little between such jurisdiction. Most usually include exemption from local corporate taxation and stamp duty, provided that the company engages in no local business (annual agent”s fees and government registration fees are still payable, which are normally a few hundred U.S. dollars per year), preservation of confidentiality of the beneficial owner of the company, wide corporate powers to engage in different businesses and activities, reduced requirement to demonstrate corporate benefit, no requirement to appoint local directors or officers, and the requirement for a local registered agent providing a registered office.
Advantages of one jurisdiction over another mostly relate to price, availability of names, familiarity, and speed of incorporation and order completion.