British Virgin Islands (BVI) is a British dependency located in the Caribbean. BVI is
one of the most popular offshore jurisdictions for company formation. The
company law system is based on British law but with great flexibility in terms of
filing requirements.
International Business Companies (IBCs) registered in BVI are private limited
companies offering the “Zero tax base” (no tax on profits).
History and Government
Geography
Legal System
The British Virgin Islands is a British protected territory and a member of the British
Commonwealth of Nations. It became self-governing in 1967 and has a democratically elected Legislative Council comprising the Governor, the Attorney General and four Ministers drawn from the Legislative Council.
The British Virgin Islands is a group of more than forty islands situated in the Caribbean approximately sixty miles east of Puerto Rico. It is one hour ahead of United States Eastern Standard time and is connected by numerous daily flights to San Juan in Puerto Rico. San Juan is an international junction with direct flights to the United States, South America and Europe.
The legal system is based on the English Common Law. The judiciary are appointed by the Territorial Government. The ultimate appellate court is the Privy Council in London.
BRITISH VIRGIN ISLANDS
CHARACTERISTICS OF A BRITISH VIRGIN ISLANDS IBC
BRITISH VIR
GIN ISLANDS
Governing corporate legislation
Time-scale for incorporation and availability of ready-made companies
The regulations governing availability of names
Documents filed on incorporation
Are details of the beneficial owners disclosed
Minimum and maximum number of shareholders
Standard authorized capital
Classes of share capital
Denomination of share capital
The BVI Business Company Act 2004, (the “ACT”) as amended
Usually 48 - 72 hours are needed and ready made companies are generally available
The words “Limited”, “Corporation”, “Incorporated”, “Societe anonime”, “Sociedad anonima” or the abbreviation “Ltd.”, “Corp”, ”Inc”, or “SA” must be a part of the name of every company incorporated under the Act. No company shall be incorporated under the Act with a name that is identical to a company already in existence or which closely resembles an existing name. Words such as “Assurance”, “Bank”, Building Society”, “Royal”, “Trustee Company” etc. will require justification.
Memorandum and Articles of Association
Not on public record
A company may be formed without shareholders although at least one shareholder will be required upon commencement of business. There is no maximum number of
shareholders provided by the Act.
Companies are normally incorporated with $50,000 to qualify for the lowest annual license fee of $350.
Share capital may be divided into different classes. “No par values” shares may be issued as may redeemable shares, bearer shares, etc.
If bearer shares are issued they must be held by an authorised custodian.
Capital taxes
Residency requirements on shareholders or shareholders meetings
Information published relating to shareholders
Minimum and maximum number of directors
Nature of the power of directors
Conclusion of contract on behalf of the company
Appointment and removal of directors
Director meetings
Information published relating to directors
Must accounts be prepared by the directors?
Must the company have a registered presence in the territory of incorporation?
None
There are no residency requirements on shareholders or their meetings.
The company must keep a share register at the registered office address. This is available for inspection by the members. There is an optional register of members maintained by the Registrar of Companies.
A company may be registered without directors. However the 1st Director must be appointed within 6 months of incorporation. Sole directors are allowed and there is no statutory maximum although the articles may impose a limit. Corporate directors are permitted and there are no nationality or residency requirements.
The directors have all the power of the company that are not reserved to the members under the Act or in the memorandum and articles.
A contract required to be executed in writing and under seal may be entered into by or on behalf of the company in writing under the common seal of the company. A contract required by law to be in writing and signed by the parties may be entered into by or on behalf of the company in writing and signed by a person acting under the express or implied authority of the company.
The first directors are elected by the subscribers to the memorandum and thereafter the directors are elected by the members. Where permitted by the memorandum and articles the directors may also elect directors for such term as the director may determine. A director may be removed from office by resolution of members or by resolution of directors.
The directors may meet at such times and in such manner and places within or outside the BVI as the directors may determine to be necessary or desirable. Telephone and other electronic meetings are permissible.
You can register both the Register of Members and Directors on public record if you so elect.
A company incorporated under the Act shall keep such accounts and records as the directors consider necessary or desirable in order to reflect the financial position of the company. The accounts do not have to be audited or filed with the financial authorities of BVI.
Yes. A BVI IBC must have at all times a registered office and a registered agent in the BVI.
What records must be maintained in the territory and are they available for public inspection?
What are the limits placed on the company’s borrowing powers?
Is there a register of company charges?
Company seal
Procedure for authentication of documents and contracts
Limitation on company to contract
Third party protection
Service of writs
A share register and an imprint of the common seal of the company must be
maintained at the registered office of the company. Other records such as minutes of meetings of directors, members and copies of all resolutions may be kept at such places as the directors determine. These are not available for public inspection.
None. There are no debt / equity ratios under the law.
A company may maintain at its registered office a register of mortgages, charges and other encumbrances. Similarly, a public register may be maintained at the option of the company.
A company incorporated under the Act shall have a common seal.
A document requiring authentication or attestation by a company incorporated under the Act may be signed by a director, secretary or an authorized officer or agent of the company and need not be under its common seal. If the signature of any director, officer or agent authenticating or attesting any document is verified in writing by the registered agent of the company, the company is bound by the document.
The capacity of a company to contract is limited by the doctrine of ultra vires. D
The directors, officers and agents of an IBC are required to act honestly and in good faith and to exercise the care, diligence and skill of a reasonably prudent person. No provisions in the Memorandum or Articles or the Act relieve a director, officer or agent of the company from the duty act in accordance with the Memorandum or Articles or from any liability arising from his management of the business and affairs of the company.
Effected at the company’s registered office.
octrine of ultra vire applies to a corporate body, so that any act done by the body which is beyond its capacity to act will be considered invalid.
BRITISH VIR
Information required to register a British Virgin Islands IBC
The corporate documents that are delivered to the shareholders of a IBC are as follows:
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Certificate of Incorporation;
Memorandum and Articles of Association;
A certified copy of the resolution appointing the first Director; A certified copy of the first minutes of the Board of Directors; Share certificates;
Company’s seal.
Corporate Documents
1. Certified copy of the passport of each beneficial owner by either a lawyer or a notary public or a bank.
2. Bank reference for each beneficial owner or a professional reference letter by a lawyer or an accountant.
3. A recent copy of utility bill (not more than 6 moths old water or electricity bill) that verifies home address of each beneficial owner
4.
Full name;
Address – business and private; Nationality;
Occupation;
Telephone and telefax numbers (private, home and mobile); E-mail.
Personal details:
