Applying the ‘Keep it Simple’ principle to corporate structures Senior managers and board members are increasingly recognising that simplifying the legal structure of a group can reduce the regulatory compliance and corporate governance burden on a business and increase transparency.
At the same time, there is a growing understanding of the consequences of a misalignment of the operational and legal structure and the negative impact on business efficiency that comes with maintaining a number of non-trading or dormant entities.
Historically, tax consequences, stamp duty and operational issues have been hurdles to simplifying corporate structures. But many of these have been removed and the availability of a variety of stamp duty exemptions for corporate reorganisations and liquidations means there has never been a better time for corporates to simplify their group structures.
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