Bearer stocks were once one of the offshore world's favorite tools. They offered total anonymity and could be easily bought or sold. But, like most of the tricks of the offshore world, they have almost completely disappeared. 

Between 2000 and 2019, mounting pressure from the OECD and other regulatory bodies forced offshore centers to completely phase out bearer shares. Today the only bearer shares available are a fraction of what they were before. They are rejected by banks, hated by tax authorities, come with special penalties and should be avoided almost 100% of the time.

Before the war on bearer shares (and the global obsession with transparency), he used to be able to set up a company and choose between keeping his shares as registered shares or bearer shares. This was true in almost all structuring jurisdictions.

In fact, the decline in bearer stocks didn't begin until 2000. It was then that the OECD began to pressure jurisdictions to eliminate them; otherwise, they would quickly be placed on a "blacklist" that would destroy their economy. Now only a few countries allow bearer shares. However, they have severe limitations and are best avoided in almost all circumstances.

What are mobile bearer shares?

Mobile bearer shares refer to unregistered securities that are owned by whoever has the physical documents of the shares in their possession. Literally, the owner of the is the one who owns the physical share certificates.

There is no public or private registry of ownership, nor is there a register of transfers of ownership. That means, if the owner loses or misplaces those shared documents, they don't own anything. If you give those shared documents to your aunt, your aunt owns the company.

If a co-worker those documents are shared from your vault, your partner instantly becomes the new owner of your company. This is the possession of physical shared documents. But, as mentioned, mobile bearer shares no longer exist and have been completely eliminated from all offshore jurisdictions.

Bearer stocks are demonized by governments. It allows criminals, terrorists and tax evaders to remain anonymous while circumventing regulators and authorities.
 
At present, the last remaining reserve in the bearer share family is the fixed bearer share.

What are fixed bearer shares?

Fixed bearer shares refer to securities that are held in custody for the owner by a registered agent, usually an authorized supplier, in the country of registration.

At the time of custody, the name of the final beneficiary is recorded along with the shares, providing a sworn record of the true owner. In other words, fixed bearer shares are not much different than having registered shares in a country with a private corporate registry.

Frankly, it's time to get comfortable with more transparency. And, if you're trying to achieve some of the goals that bearer stocks previously offered, there's a strong possibility that legal alternatives already exist.

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