Business Environment

A number of local banks as well as the Bank of Guam and the Bank of Hawaii offer financial services.

All of the major islands have their own power and water systems. It is possible to use the following telecommunication services on the major islands: telex, cellular, Internet, international calling, caller ID, and leased data circuits. Only Majuro Atoll and Ebeye and Kwajalein islands have direct dial telephones. The other islands are connected to one another with shortwave radiotelephones – these are mostly used for government purposes.

The World of Business

The government of the Republic of the Marshall Islands is very interested in encouraging private investment in a many different sectors of its economy. In addition it has a policy of proactively encouraging foreign direct investment as a means of meeting economic goals. In order to facilitate direct foreign investment, the government established the Trade and Investment Services Division, which is under the auspices of the Ministry of Resources and Development. The Trade and Investment Services Division is also responsible for promoting investment opportunities and providing information relating to investment conditions, the cost of doing business in the Marshall Islands, and investment authorization procedures. Lastly, helps to arrange meetings with government officials and identifies local private consulting, accounting and legal services to make it easy for investors to comply with the various approvals that are required conduct business activities in the jurisdiction.

All non-citizen investments must acquire a Foreign Investment Business License (FIBL). In this case, a non-citizen investment is defined as having any level of its equity held by a non-citizen (i.e. foreign citizen, corporation, joint venture, partnership or other legal entity). In order to get an FIBL, the prospective investor must apply to the Registrar of Foreign Investment in the Office of the Attorney General using a standard form.

Non-citizen investments must either incorporate as a domestic limited company in the Republic of the Marshall Islands or register as a foreign entity, which can be a limited company, partnership or sole proprietorship.

As a rule the Republic of the Marshall Islands does not discriminate against investment from any particular countries and makes a practice of welcoming most foreign investment. There are, however, certain sectors, listed below, have been reserved for citizen investment.

• Small scale agriculture for local markets;

• Bakeries and pastry shops;

• Motor garages and fuel filling stations;

• Land Taxi Operations, not including airport taxis used by hotels;

• Rental of all types of motor vehicles;

• Small retail shops with a quarterly turnover of less than US$ 1,000.00 (including mobile retail shops and/or open-air vendors/take-outs);

• Laundromat and dry cleaning, other than service provided by hotels/motels;

• Tailor / sewing shop;

• Video rental;

• Handicraft shop;

• Delicatessen, Deli Shop or Food take-out.

With the aim of ensuring food security, the government of the Marshall Islands is committed to maintaining its marine resources and the only resource that is promoted for industrial-scale fishing is tuna.

In an effort to meet private sector objectives, the government offers tax and duties exemptions for investments in selected sectors. The government does not discriminate between citizen and non-citizen investors in these cases. In order to qualify for these exemptions it is necessary to write the Minister of Finance a letter showing that the investor will make an investment of at least US$ 1.0 million, or provide employment and wages in excess of US$ 150,000 per annum to citizen workers.