An offshore company can purchase or be assigned the right to use a copyright, patent, trademark or know-how by its original holders, with a power to sub-license and subsequently exploit the intellectual property right in various countries. Such arrangements must be properly planned, as many high-tax countries impose withholding tax at source on royalty payments. An existence of a double-tax-avoidance treaty between the countries involved may reduce such withholding tax.
An offshore company can be used by internet-businesses to hold domain names and operate websites in a tax-free environment. An offshore company may be especially useful for businesses selling any non-material products through internet. In fact, operation of a high-tech, global, internet-based business through an offshore base is probably the best application of an offshore company, ever.