BVI Background

The leading offshore jurisdiction.
High degree of market awareness and acceptability.
Excellent infrastructure and professional support.
Accepted for listings on the Hong Kong Stock Exchange.

Introduction

The British Virgin Islands (BVI) are a group of islands in the Caribbean Sea located approximately 80 kilometres east of Puerto Rico. The BVI are a British Dependent Territory which became self-governing in 1967 and are a member of the British Commonwealth. Since introducing its International Business Company (IBC) legislation in 1984, the BVI offshore financial services sector has developed, and is now the world's most popular offshore centre with around 700,000 companies having been incorporated. The newly enacted BC Act should further enhance the jurisdiction's popularity.

Law and Taxation

The legal system is based on English common law supplemented by local ordinances. There are no taxes levied on BC's with the exception of the annual government licence fee, which is US$350 for companies, with the number of shares that are authorised for issue being equal to 50,000 or less. Companies that fail to pay their licence fee by the due date are subject to penalties and will be struck off for non-payment five months after the due date. There are no exchange controls or restrictions on the flow of currency in or out of the territory.

Corporate Requirements

Each BVI company must have a Registered Agent and Registered Office in the BVI, provided by a licensed service provider.

Each company must have at least one director and corporate directors are permitted. However, under the Business Companies (Amendment) Act 2005, "the New Act", every newly incorporated company is required to appoint first directors within 6 months of the date of incorporation and the original or copy of the Register of Directors is required to be kept at the office of the Registered Agent. Details of the directors do not appear on any public records, although there are provisions for optional filing of this information with the Registry of Corporate Affairs if required.

The company should have at least one shareholder and bearer shares are allowed. Under the New Act, bearer share certificates have to be held by an approved custodian. The Register of Shareholders or a copy thereof should be kept at the office of the Registered Agent. Details of the shareholders do not appear on any public records, although there are provisions for optional filing of this information with the Registry of Corporate Affairs if required. Often, it is advisable to keep the original register in the BVI for stamp duty reasons.

There are no requirements for annual returns, annual meetings or audited accounts.

Local Infrastructure

The BVI have now attracted a healthy number of international accounting firms and law firms. There are at present relatively few banks or financial institutions. The Registry of Corporate Affairs in the BVI is technically advanced and efficient, and has kept pace with continuingly increasing demand.

There are no specific statutory provisions governing secrecy in relation to companies, however, statutory filing requirements are minimal and English law, which applies to the jurisdiction, does impose a common law duty on professionals to keep the affairs of their clients confidential.