Let's suppose that a country (A) adheres to the incorporation theory. Could it be, that founding a (limited liability) company in another incorporation theory country (B) by a resident of A, and subsequently running it from A, would still be illegal in some cases?

Extra points for a bunch of illustrative examples.

Extra points for A being anything of: Switzerland, Ireland, UK, and B being anything of: Ireland, UK, USA, Estonia, Georgia (the country) or a tax haven country (B not equal to A).

Thank you

1 Answer 1


Neither the incorporation theory, nor the seat theory (which are discussed and compared in this answer) prohibit someone from incorporating a company in one country and having the company conduct activities in another country (possibly having to obtain licenses, etc. to operate in the country where it operates).

These theories pertain to which law applies to certain activities conducted by the company (e.g. corporate governance law), not to whether it is legal to be incorporated in one country and operate in another.

I know of no country's law that prohibits companies from operating internationally, or that prohibits companies from having a headquarters in a country other than the country where it is incorporated.

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