Posted on: October 9, 2021 Posted by: Hailey Zachary Comments: 0

Suppose you are considering doing business in Vanuatu. In that case, the first thing you need to know is it is a legal requirement for any foreign investor wishing to establish a business or corporation in Vanuatu to register with the Vanuatu Financial Services Commission, also referred to as the VFSC.

The VFSC is a government-established statutory organisation tasked by its governing laws, the Vanuatu Financial Services Commission Act No. 35 of 1993, to undertake business registration tasks. There are several business structures under which your firm might be registered. As a new business owner, it is up to you to understand the difference between the formations and choose the one that will work best for you and your business.

Here is a quick look at how the VFSC defines the following business structures.

Sole Trader

When it comes to company formations in Vanuatu, a sole trader is often defined as a tiny company. When you are trying to picture these smaller companies, think of a market stall or a tiny shop along the street. The lone proprietor is individually accountable for any obligations incurred by her or him. There is no legal distinction or difference between the individual and the corporate entity.


The partnership is formed when two or more individuals each contribute their own resources, whether in the form of money, property, or even their time. They then come to an agreement on how they would divide the earnings between themselves. The term “partnership” is often reserved for professionals such as accountants and attorneys.


A corporation is the most widely used business form around the globe. In some areas of the world, the corporation is also referred to as a company. When a corporation is formed, it becomes a separate legal entity from its owners, who are referred to as shareholders. The importance of this distinction is that, in the vast majority of circumstances, shareholders are not personally accountable for the firm’s obligations they own shares in.

It is usually the case that when a company fails, a shareholder’s sole obligation is the amount of money they have placed in the firm to acquire their shares. Limited liability is the term used to describe this form of obligation. Because of this, the name of a corporation is always preceded by the word “limited” or the word “ltd.”