When Austin, Texas-based Freescale Semiconductor Holdings I Ltd. went public last month in the U.S., the company followed the footsteps of generations of American high-tech companies, including its former parent, Motorola Inc.

But unlike its predecessors, Freescale wasn't going public as a U.S. company. As part of a private-equity buyout that took the chip maker private in 2006, it became a Bermuda incorporated company, according to securities filings. Freescale retained its incorporation in Bermuda, a tax haven, as the company returned to public trading.

As savvy investors and entrepreneurs search for ways to minimize the impact of the U.S. tax system, with its relatively high rates and global reach, they are increasingly incorporating overseas, tax experts say. Some private-equity firms have relocated U.S. companies or divisions to tax-haven countries. U.S. multinational companies have spun off foreign subsidiaries in tax havens. U.S. start-ups are even beginning life offshore.

"It's certainly a growing trend, and managers and firms are getting smart about it," said Mihir Desai, a Harvard business professor. Mr. Desai calculated that in 2008, there were three U.S. initial public offerings of stock by tax-haven-incorporated companies for every 10 U.S.-incorporated IPOs. There has been no similar uptick in European markets.

U.S. IPOs by companies incorporated in two tax havens—the Cayman Islands and Bermuda—have grown steadily in recent years, according to research firm Dealogic, from about 1% of the total a decade ago to 26% in 2010 and more than 21% so far this year. Most of those IPO companies are headquartered in Asia, but a substantial minority—18—have been U.S.-based. Other U.S. companies that already were publicly traded have moved to lower-tax countries through reincorporations.

As other countries have reduced corporate taxes, the U.S. has one of the world's highest top rates, at 35%, although effective rates everywhere can be substantially lower depending on tax breaks and other incentives. The U.S. also is one of the few developed countries that still seek to tax their companies' global earnings; most countries tax only profit earned inside their borders.

"If you're going to take a privatized company public, why wouldn't you say, 'What are the pluses and minuses of being incorporated in the U.S. versus somewhere else?' " said Willard Taylor, a tax lawyer with Sullivan & Cromwell LLP. "Very often, depending on what the business is, you'll conclude there are no pluses to being in the U.S."

A decade ago, a handful of U.S. companies sought to move to offshore havens such as Bermuda to reduce their tax bills. An outcry led Congress in 2004 to bolt the door. But the law left exceptions for U.S. companies that undergo a substantial change of ownership, such as being acquired by a private-equity firm. The Internal Revenue Service in 2009 tightened the rules but left some exit doors open, for example in the case of a complete buyout.

Luggage maker Samsonite, founded in Denver a century ago and more recently based in Massachusetts, is now incorporated in Luxembourg, the consequence of a 2007 takeover by private-equity firm CVC Capital Partners. With Asia now its largest market, the company went public last week in Hong Kong. It is expected to keep its tax-haven address in Luxembourg, which has a corporate-tax rate of about 22% and exempts some holding companies.

Avago Technologies Ltd. began life as the semiconductor arm of Hewlett- Packard and later was part of U.S.-based Agilent Technologies Inc., an H-P spinoff. Avago retains a headquarters in San Jose, Calif. But as part of a buyout by Kohlberg Kravis Roberts & Co. and others, Avago was incorporated in low-tax Singapore a few years ago, where the company has manufacturing and other operations, as well as a headquarters. Most of its employees are in Asia. It went public in the U.S. in 2009.

Freescale declined to comment. It was bought in 2006 by a consortium led by Blackstone Group, which declined to comment. Samsonite, CVC, Avago and KKR also declined to comment.

The move toward offshore incorporation is likely contributing to an explosion in U.S. investment in securities of offshore-incorporated companies. Treasury data show that U.S. holdings of securities of Cayman Islands companies have grown nearly twenty-fold since 1997. U.S. holdings of Cayman securities totaled $373 billion in 2009, the latest year available, the fourth-highest total for any foreign country. It also is likely contributing to erosion of the U.S. tax base, although it is difficult to say how much.

The basic outlines of the U.S. corporate-tax system are little-changed since the Kennedy years, when America didn't have to worry about attracting and keeping business. Today, its relatively uncompetitive position is helping drive efforts in Washington to revamp corporate taxes, and these corporate-tax relocations are likely to figure prominently in the discussion.

"It is troubling that today's tax code has become so complex and the current rates so high that some businesses are making the determination that it's more of a disincentive than an incentive for business growth," said Michelle Dimarob, a spokeswoman for the House Ways and Means Committee, which writes U.S. tax law.

Some Democrats disagree, saying tax havens are the real problem, not the U.S. tax system.

"Simply lowering our statutory rate or moving to a territorial system will not end these transactions," said Rep. Sander Levin (D., Mich.), the committee's top Democrat. "As we discuss corporate-tax reform, tax havens are yet another problem that is going to require careful thinking and detailed investigation."

President Barack Obama and lawmakers of both parties expressed interest in a corporate-tax overhaul earlier this year, but action has been delayed, particularly by the debate over reducing federal spending.

This article has been prepared by specialists of ABLV Corporate Services based on mass media publications. Specialists of ABLV Corporate Services provide legal and tax advise, including advise on international tax planning, establishment of holdings, trade, investment, and protection structures, purchase of real estate and other assets, as well as advise on change of residence and acquirement of residence permits. More detailed information on services provided by ABLV Corporate Services can be found at http://www.ablv.com/ru/services/advisory