Structuring a Business in Manufacturing and International Trade
Point A: The Starting Position
GLS Law was approached by a client with an active international business in equipment sales. The operational geography was impressive: Poland, Germany, the USA, UAE, and Hong Kong. Manufacturing was based in China under a trademark registered in Germany.
However:
- the companies operated independently and were not structurally linked,
- the trademark was used by all entities without any licensing agreement,
- profits were scattered across jurisdictions with no centralized control,
- the scheme appeared overly complex and raised red flags for banks and regulators,
- there was no clear model for scaling or profit distribution.
🎯 Client’s goals:
- Consolidate the business into a logical and secure corporate structure
- Protect the trademark and brand rights
- Reduce tax burden within legal boundaries
- Build a transparent model for profit distribution and reinvestment
- Prepare the business for potential investor involvement
🛠️ Our implementation approach:
- Cyprus holding
We established a Cyprus-based holding company as the parent entity. It manages operations and receives licensing and dividend income. - UAE sub-holding
To handle procurement from China, transactions with Hong Kong, and intra-group supplier contracts, a company was set up in a UAE free economic zone. - Ownership restructuring
Ownership of key jurisdictions (Poland, Germany, USA) was transferred to the Cyprus holding, with full documentation for corporate and transactional compliance. - Contractual framework
- The trademark license was formally transferred from the owner to the group entities
- Agency agreements were signed for sales and supplier relations
- Transfer pricing documentation was prepared in compliance with local laws
✅ Results for the client:
- ✔️ Transparent and legally compliant structure
- ✔️ Intellectual property (brand) protected
- ✔️ Clear profit distribution and reinvestment logic established
- ✔️ Tax risks reduced and double taxation avoided
- ✔️ Business ready for scaling and investment attractiveness increased
