Laws of the Federated States of Micronesia

This page provides information on the Code of the Federated States of Micronesia, laws and regulations related to the registration of corporations, as well as amended laws and regulations.

Laws of the Federated States of Micronesia

 

Code of the FSM, 2014 Edition (Annotated)

Corporations Law

 

FSM National Corporations Law (PL 20-35)
Corporations Law is provided in Title 36 of the Federated States of Micronesia Code. It was amended in 2017 and the law of the above link (Public Law No. 20-35) is the latest law.

Corporate Income Tax Law

 

FSM Corporate Income Tax Law
Corporate Income Tax Law is provided in Chapter 3 of Title 54 of the Federated States of Micronesia Code (Article 311 through 378). The law of the above link incorporates laws passed up to the 17th Congress of 2014.

 

The Public Laws that have passed since then are as follows:
PL 18-103, December 19, 2014 (Amendment of Sections 312-314, 322, 331, 352, 360 to include Major FSM Branches)
PL 20-100, July 20, 2018(Addition of Section 324 to give the Secretary of Finance & Administration the authority to require a third-party appraisal to determine fair market value of certain assets)
PL 20-158, January 31, 2019 (Amendment of Section 352 to eliminate interim payment of corporate tax)
PL 21-09, July 5, 2019 (Amendment of Section 321 to establish graduated tax system with three corporate income tax rates for different levels of taxable income)

 

Corporate Income Tax Regulations, December 10, 2009

 

Law regarding exchange of tax information (PL 19-143, February 6, 2017)
Tax Ruling 18-01(Corporate tax treatment of dissolution of FSM corporation after transfer of assets to affiliated foreign entity)
Tax Ruling 18-02(Corporate tax treatment of dissolution of FSM corporation and distribution of assets to shareholders)
Tax Ruling 18-03(Corporate tax treatment of FSM corporation converting into foreign corporation)
Tax Ruling 18-04(Corporate tax treatment of FSM corporation merger with an affiliated foreign corporation)

Captive Insurance Act

 

Captive Insurance Act of 2006
Captive Insurance Act is provided in Chapter 10 of Title 37 of the Federated States of Micronesia Code (Article 1001 through 1016). The law of the above link incorporates laws passed up to the 17th Congress of 2014.

 

The Public Laws that have passed since then are as follows:
PL 21-49, October 19, 2019(Amendment of Section 1007 to amend the minimum statutory capital and surplus requirements for captive insurance company)
PL 21-65, December 23, 2019(Amendment of Sections 1003, 1008, 1013, and 1016 regarding the Insurance Commissioner’s authority and 30-day rule on approvals)
PL 21-199, November 5, 2020 (Addition of Section 1017 to allow for licensed captive insurance companies to become dormant)

 

Captive Insurance Regulations, January 5, 2009
Amendment of the Captive Insurance Regulation, February 9, 2016(Amendment of Sections IX and X regarding capital requirements and solvency margin)

Venture Funds Law

 

FSM Venture Funds Law
Venture Funds Law is provided in Chapter 4 of Title 30 of the Federated States of Micronesia Code (Article 401 through 425). The law of the above link incorporates laws passed up to the 17th Congress of 2014.

 

The Public Laws that have passed since then are as follows:。
PL 18-124, May 8, 2015(Amendment of Sections 402-404, 406-409, 420, and 422-425)