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Seychelles IBC Prohibited Activities: What Needs a Licence
What a Seychelles IBC cannot do: banking is banned everywhere, and 6 other activities, from securities and funds to gambling and crypto, face licence rules.
Licensed auditor & chartered accountant · 6 years of experience in offshore accounting
A Seychelles IBC can carry on almost any lawful business, from consulting and e-commerce to holding shares and intellectual property. A short list of activities is either banned or locked behind a licence, and it is worth checking before you apply. In this post, we’ll walk you through the full list under the current IBC Act, how the rules differ inside and outside Seychelles, and the businesses providers have to turn away.
Quick Summary
An IBC cannot carry on banking business anywhere in the world.
Insurance and securities business are banned for an IBC in Seychelles and allowed abroad only where the company is licensed or otherwise legally allowed to operate.
Mutual funds, gambling (including online gambling) and corporate, trustee or foundation services are allowed only under the matching licence or legal permission.
Crypto mining and mixer services are banned, and virtual asset services, ICOs and NFT issuance in or from Seychelles need FSA approval under the VASP Act 2024.
Everything else lawful is open to an IBC, and a company that breaches these rules can be struck off.
Providers must turn away any client whose due diligence they cannot complete.
What a Seychelles IBC Can Do
Section 33 of the International Business Companies Act 2016 gives a company full capacity to carry on any business or activity, subject to the Act and other Seychelles law. The memorandum can list objects but does not have to, and without them a Seychelles IBC can do anything the law does not prohibit (section 17).
That covers the ways most owners use one:
selling services, software or goods to customers outside Seychelles
consulting and freelance work billed internationally
holding shares in other companies
holding intellectual property, investments and other assets
running an online business
None of these needs a licence under the IBC Act, and each fits our US$850 all-in IBC formation.
Seychelles IBC Prohibited Activities: The Full List
Section 5(2) sets out the activities an IBC cannot carry on, and for most of them the answer depends on where the business happens.
Activity | In Seychelles | Outside Seychelles |
|---|---|---|
Banking | Prohibited | Prohibited |
Insurance | Prohibited | Only if licensed or otherwise legally allowed where it operates |
Securities business | Prohibited | Only if licensed or otherwise legally allowed where it operates |
Mutual funds | Only if licensed or legally allowed under the Mutual Fund and Hedge Fund Act or a recognised jurisdiction’s law | Same rule |
Gambling, including online | Only if licensed or otherwise legally allowed under Seychelles law | Only if licensed or otherwise legally allowed where it operates |
Corporate, trustee or foundation services | Only as permitted by the International Corporate Service Providers Act | Also only if licensed or otherwise legally allowed in each country where it operates |
A company that fails to comply with section 5(2) can be struck off the register under section 272.
Crypto and Virtual Assets: What an IBC Cannot Do
The Virtual Asset Service Providers Act 2024 added a crypto paragraph to section 5(2). Under it, an IBC cannot:
carry on crypto mining, or operate a mixer or tumbler service
carry on virtual asset services in or from Seychelles without a licence under the VASP Act
issue, or claim to issue, an initial coin offering or an NFT in or from Seychelles without FSA authorisation
promote an ICO, or the sale of or investment in NFT development, in or from Seychelles without authorisation
The FSA has published a caution notice about IBCs providing virtual asset services. The VASP Act defines what counts as a virtual asset service, so check that definition before building a crypto business on an IBC.
Licensed Activities Outside Seychelles
For insurance, securities, gambling and corporate services abroad, the Act looks to the law of the country where the business actually runs. An IBC selling insurance in another country must hold that country’s licence or otherwise be legally allowed to operate there, and the same test applies to an online casino.
Incorporating in Seychelles does not replace those licences. If an activity needs a licence where the business runs, it still needs one when the company running it is an IBC.
Doing Business and Owning Property in Seychelles
The current section 5(2) does not list trading in Seychelles or owning property there. Two rules still shape those decisions:
Seychelles-sourced income is taxed. Under the territorial system, income earned in Seychelles is taxed at 15% on the first SCR 1 million and 25% above that, according to the Seychelles Revenue Commission.
Seychelles property is not stamp duty exempt. Section 362 exempts most company transactions from stamp duty, but not a transfer of Seychelles immovable property, or deals in the shares, debt obligations or other securities of a company that has an interest in Seychelles property directly or through a subsidiary.
Local trading and property deals also fall under Seychelles’ other laws, such as business licensing, which sit outside the IBC Act.
Which Businesses Formation Providers Refuse
Every licensed provider is a reporting entity under the Anti-Money Laundering and Countering the Financing of Terrorism Act 2020, so some refusals are set by law. These are the cases where the answer is no, or where the file gets extra scrutiny first:
No completed due diligence. Section 43 bars a provider from taking on a client whose identity, beneficial owners or business purpose it cannot verify, and requires it to end an existing relationship for the same reason.
An unlicensed regulated activity. A company whose planned business sits on the section 5(2) list, without the matching licence or legal permission, would breach the IBC Act from day one.
Politically exposed persons. Anyone who holds, or has held in the last 3 years, a prominent public role, their immediate family (spouse or partner, children and their spouses, parents and siblings) and close associates can only be taken on with senior management approval and evidence of source of wealth and funds (section 36).
High-risk countries. Clients linked to countries that do not fully apply FATF standards get enhanced checks (section 41), and for countries under an FATF call for action, the Counter-measures Regulations 2022 allow authorities to require providers to limit business with those countries.
Higher-risk features. The AML/CFT Regulations 2020 treat nominee and directorship services, unusually complex structures, cash-intensive businesses and remote onboarding without safeguards as higher risk, which means more questions before approval.
Each of these can be prepared for. The KYC checks every owner goes through move fastest when the file answers these questions up front, and leaving them open is one of the costlier Seychelles company formation mistakes.
Changing What Your Company Does Later
An IBC can change its business at any time, within the same limits. Whatever the memorandum and articles say, they have no effect where they conflict with the IBC Act (section 11(4)), so no clause can authorise a prohibited activity.
Due diligence is also ongoing. Section 35 of the AML/CFT Act requires providers to monitor every business relationship, so tell your provider before a new line of business starts. The activity description you submitted during Seychelles company formation is the baseline those checks compare against.
