Druk Yul! If you are a business owner in Bhutan looking to expand your operations to the USA, it is important to understand the compliance, legal, and beneficial ownership reporting requirements that come with operating in a foreign country. As you navigate through the intricacies of doing business in the Land of the Thunder Dragon and the Land of the Free, it is crucial to stay informed and compliant with the regulations set forth by both countries to ensure the success and sustainability of your business ventures. Let’s explore together the steps and considerations needed to effectively manage your business operations in Bhutan and the USA while meeting all necessary reporting requirements.

Registration Requirements

The United States consists of 50 states and 5 territories, each with its own set of business regulations. To operate legally, businesses must adhere to both state-specific rules and federal laws.

State-Level Registration:

When establishing a business presence in the United States, businesses from Bhutan must complete state-level registration in any state where significant business activities occur. This requirement typically applies if your company:

• Has a physical presence in the state
• Frequently meets with clients in the state
• Derives a significant portion of revenue from the state
• Has employees working in the state

Incorporating your Bhutanese Company in the US

Even if none of the specific criteria apply, a Bhutanese company must still choose a home state for registration when conducting business in the US. This involves forming a U.S. entity, such as a corporation, LLC, or other business structure, in that state. This registration ensures that the company is officially recognized and compliant with US regulations, regardless of its level of business activity in any individual state.

The newly formed U.S. entity will operate as a subsidiary of the foreign company. This means that while the U.S. entity is legally independent, it remains under the ownership and control of the parent company based in Bhutan. This structure allows the company to conduct business in the US while maintaining its international headquarters.

We recommend using Northwest Registered Agent if your foreign company needs to incorporate. They offer expert guidance and can serve as a reliable registered agent for your business, ensuring compliance and smooth operations.

Federal Requirements

In addition to state requirements, Bhutanese companies must also comply with federal regulations:

• Federal Tax ID: Obtain an Employer Identification Number (EIN) from the IRS. This number is essential for tax reporting and opening U.S. bank accounts.
• Industry Regulations: Companies may need to follow specific federal regulations depending on the industry. For example:
• Import/Export Laws: If the company is involved in importing or exporting goods, it must meet U.S. customs regulations. This includes adhering to rules for tariffs, duties, and necessary documentation.

Beneficial Ownership Information Reporting Requirements

For Bhutanese businesses conducting operations in the U.S., adhering to Beneficial Ownership Information Reporting (BOIR) requirements is crucial. The Corporate Transparency Act mandates that companies disclose the individuals who own or control them. This applies to most entities, including those that are incorporated or registered in any U.S. state. The goal is to enhance transparency and combat illicit activities such as money laundering and terrorism financing.

A beneficial owner is an individual who controls the company or owns 25% or more of its shares, either directly or indirectly. For compliance with BOIR requirements, businesses must report information about these individuals, including their names, addresses, and identification details. Failure to file this report can result in significant penalties and legal consequences. Therefore, companies from Bhutan need to ensure they meet these reporting obligations promptly and accurately.

For your convenience, you can file your Beneficial Ownership Information Report directly on our website. Click here to complete the process in just a few minutes and ensure your business complies with U.S. regulations.

Additional Considerations for Bhutanese Businesses:

Tax Treaties

As a business operating from Bhutan, it’s crucial to understand that there is no tax treaty between Bhutan and the United States. This absence of a tax treaty means that your company may face double taxation on income earned in the USA. You’ll likely be required to pay taxes on your US-sourced income to both the US government and the Bhutanese government, potentially reducing your overall profits. It’s advisable to consult with international tax experts to explore strategies for minimizing this tax burden and ensuring compliance with both countries’ tax laws.

Trade Considerations

When conducting business with the USA, companies from Bhutan should be aware that there are no specific bilateral trade agreements between the two countries. However, it’s crucial to research and comply with industry-specific regulations that may apply to their particular business sector. These regulations can vary widely depending on the nature of the products or services being traded. Bhutanese businesses should consult the U.S. International Trade Administration and the U.S. Customs and Border Protection websites for detailed information on import requirements, tariffs, and any applicable restrictions. Additionally, they should familiarize themselves with U.S. standards and certifications that may be necessary for their products to enter the American market. It’s also advisable to seek guidance from trade associations or legal experts specializing in international trade to ensure full compliance with all relevant U.S. regulations and avoid potential legal issues or trade barriers.

Your Path to Compliance: Key Takeaways for Bhutanese Businesses in the U.S.

Operating a Bhutanese business within the USA requires careful attention to legal obligations, from establishing your home state to incorporating and filing a beneficial ownership report. Meeting these requirements is essential for ensuring compliance and securing your business’s success in the American market. By understanding and adhering to these steps, you can confidently navigate the complexities of doing business in the U.S. and focus on growing your enterprise.

Ready to get started? Click here to file your BOIR in just a few short minutes. We make the process easy, fast, and secure so you can focus on what matters—your business.