The LLC (Limited Liability Company) is a US invention. It has been very successful over there where it is the entity of choice for small (and some large) businesses. An LLC is essentially a partnership with corporate personality and limited liability. The UK Limited Liability Partnership (LLP) which came into existence later is the UK equivalent.
LLC legislation came into force in the Isle of Man in 1996 and is very closely based on the Wyoming Act. Less than 2000 LLC have been organised (incorporated) in the Isle of Man in the 15 years since its inception so I think it’s fair to say that it hasn’t been the success that was originally hoped.
I think the main reason for this is the change of attitude towards US clients in the Isle of Man and elsewhere. In the 1990s US clients were ‘fair game’ – both for tax planning and asset protection structures but the relentless pursuit by the IRS of US taxpayers using offshore structures has resulted in most service providers, especially on this side of the Atlantic shunning US clients – as not worth the hassle.
Nonetheless, LLC’s have their uses, my own firm Middleton Katz Chartered Secretaries is established as an LLC and they can be extremely useful for asset protection purposes. See here for more information.