Offshore business is about using the possibilities offered by countries (commonly known as Jurisdictions), whose legislation allows for certain advantages (tax, confidentiality, company structure, etc.) to be used by non-residents.
This means that a country, or Jurisdiction, will allow registration of a company and offer them certain tax freedoms in exchange for an annual licence fee. It is normally a legal requirement that the registered company must not conduct any business or own any assets in the Jurisdiction of incorporation.
This in turn allows companies to be set up in that Jurisdiction, sometimes resident, sometimes not (depending on the legislation), to trade on an international basis taking advantage of the easier flow of money on the international markets. These Jurisdictions often allow another company to be appointed as the Director and Shareholder of a company. Most countries today still partake in the idea that the flow of money in or out of the country has to be restricted, regulated, or at least monitored, and of course, taxed.
