TURKS & CAICOS Law and Practice Contributed by: Oliver Chapman and Chris Smith, Griffiths & Partners Attorneys
5. Investment Vehicles 5.1 Types of Entities Available to Investors to Hold Real Estate Assets Title to real estate must be held by a Turks and Caicos limited liability company or by a natural person, although the upstream ownership struc - ture is not regulated. 5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity The constitutional documents of a company incorporated in the Islands will set out its gov - ernance framework, including the powers of its board of directors, who ordinarily manage the day-to-day operation of the business. In rela - tion to a company incorporated as a company limited by shares, the liability of its shareholders is limited to the amount (if any) unpaid on their shares. 5.3 REITs Due to the relatively small size of the Islands’ real estate market, it is generally not common to see large portfolios of real estate held by REITs. Real estate can be held by a trustee or multiple trustees on behalf of the underlying trust, and foreign investors would be able to participate in such arrangements. 5.4 Minimum Capital Requirement There are no minimum capital requirements for a company. 5.5 Applicable Governance Requirements The company will typically have one or more directors who manage the day-to-day business of the company. The constitutional documents set out the governance framework, along with the Companies Ordinance (as revised).
5.6 Annual Entity Maintenance and Accounting Compliance Companies incorporated in the Islands are obliged to pay annual fees, which typically amount to USD1,500 to USD2,000, inclusive of the company agent and government fees. 6. Commercial Leases 6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time A person or company wishing to occupy another party’s real estate for a limited period may do so by contractual licence with the owner or, more commonly, by entering into a lease. 6.2 Types of Commercial Leases Given the size of the jurisdiction, there are no specific different types of leases. 6.3 Regulation of Rents or Lease Terms Rents and lease terms are freely negotiable. Cer - tain landlord and tenant covenants are implied in a lease by Sections 52 and 53 of the Registered Land Ordinance, unless otherwise expressly provided for in the lease. 6.4 Typical Terms of a Lease The tenant is typically responsible for repairing the demised premises, and the landlord is usu - ally under obligation to insure and maintain the building and the common parts, and will usually recover these costs from the tenant in addition to the rent. Rent is commonly paid monthly, in advance or arrears.
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