<instructions>Your goal is to analyze the following comment and estimate how highly it will be upvoted by the Hacker News community.</instructions><comment><author>Hermel</author><text>There are various valid use cases for companies without business. Examples include:&lt;p&gt;- 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.&lt;p&gt;- Investment funds: investment funds (especially passive ones) are companies whose only business is to own shares in other companies. There is no &amp;quot;real&amp;quot; operating business.&lt;p&gt;- 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.&lt;p&gt;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.</text><parent_chain><item><author>BLKNSLVR</author><text>&amp;quot;Shell corporations are companies that don’t actually do any business&amp;quot;&lt;p&gt;This, I think, is a fairly key differentiator between valid and invalid use of incorporation. If a company doesn&amp;#x27;t do any business, then it shall not have a right to exist as it has no reason to exist, as the reason companies exist is to do business.&lt;p&gt;One may argue there are other reasons a company may exist, but I&amp;#x27;d argue those reasons only exist as an unintended consequence of the ability to exist as &amp;#x27;shields&amp;#x27; or &amp;#x27;cut-outs&amp;#x27; as discovered by those familiar with the peculiarities of international law and accounting&amp;#x2F;finance.</text></item></parent_chain></comment><story><title>Tips for linking shell companies to their secret owners</title><url>https://gijn.org/stories/tracking-shell-companies-secret-owners/</url></story>
<instructions>Your goal is to analyze the following comment and estimate how highly it will be upvoted by the Hacker News community.</instructions><comment><author>defrost</author><text>&amp;gt; If a company doesn&amp;#x27;t do any business, then it shall not have a right to exist as it has no reason to exist, as the reason companies exist is to do business.&lt;p&gt;One &lt;i&gt;typical&lt;/i&gt; use of shell companies in mineral exploration is to obfuscate regions of interest from the prying eyes of competitors.&lt;p&gt;If some wants to gather lease ownership of a large number of small leases in (say) a province of Canada then it&amp;#x27;s a matter of public record that mining|exploration leases change ownership in public records.&lt;p&gt;The end goal here is to &lt;i&gt;publicly&lt;/i&gt; declare ownership &lt;i&gt;after&lt;/i&gt; exploration results (geochimistry, prelim drilling, etc) have been assesed by third party technical reports and put a prospect on the stock market to attract investors. This gets a bit complex when someone else owns a band of rights dead centre through your ROI.&lt;p&gt;This is a use of shell companies that&amp;#x27;s distinct from hiding assets from taxation, it&amp;#x27;s obfuscation for the purpose of getting ducks lined up before going public.</text><parent_chain><item><author>BLKNSLVR</author><text>&amp;quot;Shell corporations are companies that don’t actually do any business&amp;quot;&lt;p&gt;This, I think, is a fairly key differentiator between valid and invalid use of incorporation. If a company doesn&amp;#x27;t do any business, then it shall not have a right to exist as it has no reason to exist, as the reason companies exist is to do business.&lt;p&gt;One may argue there are other reasons a company may exist, but I&amp;#x27;d argue those reasons only exist as an unintended consequence of the ability to exist as &amp;#x27;shields&amp;#x27; or &amp;#x27;cut-outs&amp;#x27; as discovered by those familiar with the peculiarities of international law and accounting&amp;#x2F;finance.</text></item></parent_chain></comment><story><title>Tips for linking shell companies to their secret owners</title><url>https://gijn.org/stories/tracking-shell-companies-secret-owners/</url></story>