NFT GAME – WHERE TO ESTABLISH THE COMPANY?
In 2017, NFT games began to emerge as a global craze. In this market have appeared businesses valued at billions of dollars. However, many projects are still struggling to choose a country to set up a company to match the operating model of the business. This article will partly help NFT game owners in finding their “home country”.
1. Countries with high risk
Currently, the field of NFT in general and NFT games in particular are still falling into the grey area in many countries when there is no specific regulation. Even so, projects should avoid countries with a negative attitude towards the blockchain industry in general such as China, Canada, the United States, etc.
2. Where should I set up a company?
To take advantage of legal and financial advantages in each country, project owners may consider opening a company in the following locations.
Singapore is the first choice of NFT game projects when establishing a company with the following advantages:
- Clear blockchain regulatory framework
Singapore is a leader among countries in building a blockchain regulatory framework. Currently, regulations on cryptocurrency, tokens and platform operators are being introduced by the Monetary Authority of Singapore (MAS), which are outlined in two main laws, the Securities and Futures Act (SFA) and Payment Services Act (PSA), followed by extremely detailed instructions. This helps game developers clearly understand the steps to optimize business operations while still complying with the law.
- Tax preferences
Corporate income tax from 0% to 17% depending on pre-tax profits and 0% capital gains tax and many other tax incentives of the Singapore government are among the highlights which attract projects to establish companies here.
- International capital attraction
Singapore becomes a regional and international financial hub with more than S$2,000 billion by 2020, topping the 2021 Global Investment Opportunities Index released by Whiteshield Partners. At the same time, setting up a company in Singapore also helps to enhance the brand value. Many popular games such as Axie Infinity, and Ethlas have also established companies in Singapore due to the incentives and environment here.
The positive attitude towards the blockchain industry in general and the NFT game in particular has defined BVI as one of the most friendly countries on the blockchain map. Some salient features of establishing a company at BVI include:
- 0% tax incentives
Offshore companies located in the BVI are not subject to any income taxes, corporate taxes, capital gains taxes, property taxes or similar taxes.
- Low cost
BVI does not require a minimum capital amount or a capital contribution within a specified period. This paves the way for businesses to open and run a company.
- Easy operation
Because the company does not have to pay tax, it does not need to submit an annual tax return to the authorities. At the same time, companies do not need to hold annual meetings and do not have to notify the authority if there is a change of directors or shareholders.
Panama emerges as a gathering place for blockchain companies with distinct advantages:
- Open regulation for blockchain
Currently, Panama does not have any existing regulations banning cryptocurrency or blockchain business, it even has a very positive attitude towards the industry.
- Tax advantages
Under the Companies Act, foreign companies that do not reside in Panama are completely exempt from paying taxes. This factor makes the country an attractive area for NFT game companies in particular when the operating capital is not much.
- Stable and growing economy
The inflation rate is low and the currency is stable as the US dollar is used as the legal tender of this country. Currently, Panama is aiming to allow the use of virtual currencies for payment.
2.4. Hong Kong
Hong Kong is an attractive option for NFT gaming projects not only because of the favorable conditions for businesses but also the very practical approach in the field. Some of the advantages of setting up a business in Hong Kong include:
- Attractive tax policy: Hong Kong does not apply capital gains tax, dividend tax, and VAT to foreign companies.
- One of Asia’s most developed financial hubs: Hong Kong’s simple rules and regulations will help build a smooth NFT gaming business operating here.
- Hong Kong Government encourages blockchain industry: The Monetary Authority is testing its own blockchain in the financial sector and applications. Blockchain remains one of the priorities of the Hong Kong economic development agency.
The common point of establishing a company in these regions is a positive attitude towards the blockchain industry and the NFT. Also, these regions do not require the company’s owners to be present in the country.
We believe that each NFT game project with different missions and operating models requires unique conditions. JNT always aims at comprehensive solutions suitable for each business problem and customer’s requirements.
Proud to be a pioneering professional legal and financial consulting unit in the blockchain, JNT has been helping hundreds of Clients achieve their business goals. Please contact JNT for the most comprehensive solution for your Project!
Auth. Zed Nguyen