British Virgin Islands - Totalserve Trust Company Ltd

Fact Sheet
British Virgin Islands
The British Virgin Islands (BVI) has been a British colony in the Caribbean since 1672. Part of the
Virgin Islands chain, it primarily consists of the islands of Tortola, Anegada, Virgin Gorda and Jost Van
Dyke and 32 smaller, mostly uninhabited islands.
BVI has been an international business centre since the 1980s with constant updates to its legislation
to ensure it remains on the cutting edge of the international business industry. As such, BVI has been
placed on the “whitelist” of those countries that have substantially implemented the internationally
agreed tax standards as set by the Organisation for Economic Cooperation and Development (OECD).
Also, the Virgin Island’s Shipping Registry (VISR) has been upgraded to Category One of the Red
Ensign British Registry.
The total number of companies registered in the BVI exceeds 700,000 with more than 5,000 new
companies registered every month.
Basic Characteristics
Corporate requirements
Minimum Share Capital
Minimum Number of Shareholders
Minimum Number of Directors
Non-resident Directors
Bearer Shares
Corporate Directors Permitted
Company Secretary
Shelf Companies Available
Possible Name Endings
One share
Limited, Unlimited, (SPV) Limited, Corporation, Incorporated,
Société Anonyme, Sociedad Anonima, Segregated Portfolio
Company or the abbreviations Ltd., Ultd, Corp., Inc., SPC or S.A.
Local requirements
Registered Office/Agent
Local Directors
Local Secretary
Local Meetings
Government Register of Directors
Government Register of Shareholders
Annual Requirements
Annual Return
Submit Audited Accounts
Time to incorporate
Shelf companies
Necessary Documents for the
Same day
Immediate Delivery
Details of the Professional intermediary or shareholder,
including copy of passport, reference letter
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BVI Bearer Shares Conversion
Following an amendment in the relevant British Virgin Island legislation, as from 1 January 2010 all
BVI companies incorporated prior to 1 January 2005 and which retain the right to issue bearer shares
will be deemed to have amended their Memorandum & Articles to remove this right.
BVI Trusts
The principle statutes governing trusts in the BVI are the Trustee Ordinance 1961 (TO), based upon
the English Trustee Act 1925, and the Trustee Amendment Act 1993 (TAA). The TO has been
extremely upgraded and improved by the adoption of the Trustee (Amendment) Act 2003.
The purpose of the amendment was to establish certain new rules for trusts, which would make the
BVI an attractive trust jurisdiction. Such improvements include provisions relating to dealings between
trustees and third parties and a new and improved regime for purpose trusts. Most BVI trusts are
exempt from all taxes, as long as the beneficiaries are not BVI residents, the trust does not own land
in the BVI.
BVI Trusts, like all traditional trusts, require that trustees should be actively involved in the affairs of
the underlying company, thereby making the trusts an attractive vehicle through which to hold longterm assets.
VISTA Trusts
On 1 March 2004, the Virgin Islands Special Trust Act, 2003 (VISTA) came into force. The purpose of
the Act is to exclude the “prudent man of business rule” and allow shareholders of BVI companies to
establish trusts that disengage the trustee from management responsibilities in the underlying
company, leaving such responsibilities to the directors, without any power of intervention exerted by
the trustee.
The legislation permits the entire removal of the trustee’s monitoring and intervention obligations. It
also permits the settler to confer on the trustee a duty to intervene to resolve specific problems and
allows trust instruments to lay down rules for the appointment and removal of directors.
VISTA Trusts are extensively used in family-holding company structures.
Moreover, when setting up an off-balance sheet structure, serious consideration should be given to
establishing a VISTA charitable or non-charitable purpose trust to own shares in a Specific Purpose
Vehicle (SPV), which would take the form of a BVI company.
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VISTA Trusts can be used when:
The settlor wishes to retain control at the director (company) level
A trustee’s involvement in an underlying company’s affair is undesirable or inappropriate
The settlor intends the shares, which he wishes to settle on trust and/or the underlying assets,
to be retained
The underlying assets of a trust involve a degree of risk, which would be regarded as
inappropriate for a trustee of a non-VISTA trust.
The Act is confined to shares in BVI International Business Companies.
BVI Mutual Funds
Mutual Funds in the BVI are regulated by the British Virgin Islands Mutual Fund Act, 1996 as
amended by the Mutual Funds (Amendment) Acts, 1997 and 2001. The Acts define three categories
of investment funds: Professional, Private and Public
A BVI Mutual Fund enables efficient use of investment expertise and resources, while the relevant
Acts ensure a well-regulated regime with a policy of non-interference in the day to day operation of
the fund.
The number of Mutual Funds registered in the BVI currently exceeds 3.000.
BVI Business Company Act (BVIBCA)
The new BVIBCA which came into effect in January 2005 brought together the International Business
Companies Act of 1984 (IBC Act) and the Companies Act (Cap 285), which only applied to local
companies doing business within the BVI. Under the new BVIBCA, a BVI registered agent is required
to form the company.
As from 1 January 2006, all new companies in the BVI are being formed as BVI Business Companies
(IBCs) under the BVIBCA, which has become the sole Business Companies Act in the jurisdiction. The
new legislation was drafted to ensure the territory was fully compliant with the EU Savings Tax
Directive and the EU Code of Conduct on Business Taxation.
The new BVIBCA retains many of the benefits of the IBC Act, including:
 Same day incorporation
 Exemption from all BVI taxes, including income tax, stamp duties, dividends, interest, rents,
royalties, and compensations
 A high degree of confidentiality
 Limited statutory filings
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Ease of administration and operation
The BVIBCA provides for:
 Companies limited by shares
 Companies limited by guarantee not authorised to issue shares
 Companies limited by guarantee authorised to issue shares
 Unlimited companies authorised to issue shares
 Unlimited companies not authorised to issue shares
 Restricted purpose companies
 Segregated portfolio companies
The BVIBCA also provides for greater flexibility on the name that can be used by a BVI business
company. Amongst others, the company can also have an additional name in foreign characters,
making it particularly attractive for investors from the Orient.
Elevating the standards of corporate governance:
The new Act sets out directorship guidelines requiring the maintenance of registers of
directors at the companies’ registered office.
Due to its strategic geographic location, stable economy and UK-based legal and political system, BVI
has been and is expected to remain one of the world’s most attractive International Business
The above is intended to provide a brief guide only. It is essential that appropriate professional advice is
obtained. Totalserve Trust Company Ltd will be glad to assist you in this respect. Please do not hesitate to
contact us.
June 2011
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