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XXXX “Trading Company” S.a.r.l.

by Consulting & Promotion

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Overview

This document explain the establishment of aSociety "Sarl" Monegasque capable ofmarketing of any product / service.

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Current situation

In some CEE Countries there is a problem of anyrefunds of value added tax and in particular thetaxation of profits, not adapted to the Company thatthey intend to trade in goods or services

In Italy it is likely to indicate that the taxation imposedon business profits is 50% (direct and indirect)*see attached prospectus (p.6) *

These and other issues are the limits to corporate andeconomic development in Europe

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Current situation EEC Countries

With current legislation there is no progressand the Anglo-Saxon model of "TradingCompany", a true expression of the freemarket is not applicable to countries with hightaxes (including obviously, Italy)

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Possible alternatives

Establish a Trading Company in other countries es : Switzerland: the Constitution are fast but require a structure that is very

close to the Spa for the characteristics of real operations on the Italianterritory as well as other important limitations;

Not all costs incurred by the company are deductible from the profits ; NON €uro Area; England: it is apparently easier constitution but its remoteness prevents a

quick and direct control; Other countries: not recommended. NB And then unlikely if not improbable that a company with Head too far

from the Italian borders work "really" on the territory ...

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Taxex in Italy (example)NB: The following example is of course lack of real corporate data of the "Mother

House" and therefore do not consider that these were any exemptions, applicationof reduced%, of which the company could use and that the amount of incomeconsidered for IRAP is the same as that for IRES.

We imagined a Taxable Income (allegedly based on current tax and the "Field Studies"in force for the Srl in Italy, amounting to about €75,000.00) on sales and incomearising from trading amounted to €100,000.00 :

it appears that the rate of increase in taxes payable amounted to 150% because : - IRAP + IRES on base income euro 75.000,00 - IRAP + IRES on base income including increased euro 186.250,00 for a difference of EUR 111,750.00, which represents a percentage

150%

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Objectives

Open a Company Srl (Limited Liability Company, Srl comparableto Italian and other "European" but with less red tape in businessoperations) in the Principality of Monaco;

Need to rent premises where the activity will be undertaken.(The rent can also be relatively low operating costs on the localmarket in an appropriate manner)Development of business in the jurisdiction.

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Costs Constitution Terms of Registration Notary + public cost: €10,000 approx Share Capital: €20,000 fully paid Rent: €35.000/Year (the newly formed company can rely on

Business Center and the cost month is equal to €700/ca butmaximum for 6 months)

Secretariat €15,000 years (if supported a Business Center is thecost stated above)

Tax advisory / administrative €10,000 years Telephone + Fax + Internet €10,000 years (if supported a

Business Center is forfeitized) Representation costs and travel : € ? Taxation: see below (pag.9)

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Benefit For Companies that perform less than 25% of their turnover

outside the Principality is in effect the total exemption from taxesfor a higher percentage, the maximum tax is 33.33%besides:

Shall assume all the costs related to the activity itself (andtherefore, suppose that adds to fixed costs the "salary" to be paidto the Director, it will be completely deducted from the profits ofthe Company) and, moreover, they will not have to worry , beingthe person totally exempted from payment of taxes in Monaco

Is there a program to help businesses "that requires the highesttax brackets to be reached, the first and second year of operationare NOT taxable, the third year the tax is calculated on 25% ofprofits, the fourth year calculated on 50% of profits, the fifth yearin the 75% of profits and the sixth year on 100% of profits.

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Timing

Months 1: to prepare the necessarydocumentation to be submitted to theDirectorate of economic expansion "in Monaco;

Months 1: waiting for the answer;Months 1: we need this time to estimate the

true activation of the Company (theConstitution, research location, connections,etc.. Etc.).

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Disavantages Costs of setting up relatively high compared to other countries, but offset by deductions and

exemptions significantly more money. Overhead costs appear higher but to be asked in connection with the appeal of the

Principality, which may become an additional attraction for the better management of ourcustomers.

Taxation in the EEC is a topic of interest to customers who appreciate the convenient "tax" orthe ability to operate in "Tax Planning" for his company, which is impossible if you work with aCompany Law Italian (no need to abuse it because in any case it is not pleasing to theDirectorate of economic expansion that makes the controls).

The constitution of the Company is still subject to approval of the Directorate of economicexpansion of Monaco, which means that without the support of an accountant on the spot Epdifficult (impossible) to establish an in Monaco.

The operation of the Company should include the presence of the individual member toperform the work on site, this means that should be taken from the residence of the Chief(who will enjoy the tax benefits of the Principality, but must demonstrate, according to Italianlaw in force, their stay in Monaco for at least 6 months and 1 day / year) and must bear theburden (rent etc.).

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Advantages

Lower taxes in absolute terms; Safe from the prestige of the location and related

infrastructure (the loyalty of customers is also thevarious events taking place during the year in thePrincipality and that it "catalyst" for other businessopportunities);

Proximity to Italy, there is no real "frontiers" andtherefore quick control and management of theactivity.

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Other possible scenarios

Opening the Sarl is also possible to exploit the addressfor possible synergies in collaboration with otherentities in order to allocate the costs in various ways,as required by existing legislation.

This addition to the savings, it could represent afurther opportunity for expansion of the business.

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