The Bahamas bans nominee directors and tightens rules on nominee shareholders
The Bahamas' Companies (Amendment) Act 2025 and International Business Companies (Amendment) Act 2025, enacted on 19 June 2025, prohibit anyone acting on a third party's instructions from serving as a company director. Acting as a nominee director is an offence with fines up to USD 50,000 and 12 months' imprisonment. Nominee shareholders remain allowed but must be disclosed and backed by a declaration of trust.
The amendments target misuse of nominee arrangements ahead of the Bahamas' Caribbean Financial Action Task Force mutual evaluation. Amendments to the Register of Beneficial Ownership Act were made alongside them.
What changed
- Nominee directors banned: a new section 41A of the International Business Companies Act and section 80A of the Companies Act prohibit people acting on the instructions of a third party, such as a beneficial owner, from serving as directors.
- Penalties: acting as a nominee director is an offence punishable by a fine of up to USD 50,000, up to 12 months' imprisonment, or both. A company that knowingly keeps a nominee director faces a civil penalty of up to USD 1,000 a day.
- Nominee shareholders: still permitted, but their status must be recorded in the company's memorandum and register of members, and a declaration of trust naming the beneficiary must be kept at the registered office.
- Beneficial ownership: register of beneficial ownership provisions extend to nominee arrangements.
- Sources describe a transition period for existing companies to replace nominee directors and update records.
Who is affected
Bahamian companies and international business companies, their registered agents and corporate service providers.
What to do
Replace any nominee directors, and document nominee shareholdings with declarations of trust.