[Hermel]

There are various valid use cases for companies without business. Examples include:

- International holding companies: if there is Coca Cola France and Coca Cola Germany that economically belong together, you might not be able to just merge them into one entity for legal reasons (both countries might require you to have a locally incorporated presence). So to ensure that both always have the same owners, you create an international holding company that owns both of them.

- Investment funds: investment funds (especially passive ones) are companies whose only business is to own shares in other companies. There is no "real" operating business.

- Feeder funds: sometimes, the law requires foreign investment funds to create a local shell company to be allowed to accept investments from local retail investors. In this case, the only purpose of the shell company is to fulfill local regulatory requirements with regards to the legal form if the investment vehicle and to provide investors with someone local that they can hold liable in case things go wrong. There is no real business in such companies.

In fact, it is often regulation that requires you to create shell companies. If you want to get rid of shell companies, you should start by removing regulation that requires the creation of shell companies with no real business except to satisfy the regulators.

[goodlinks]

Are you not giving more examples of how shell companies are created to get around regulation here?

I.e. an indicator not really following the spirit of the regulation, only the letter?