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Background
Since the adoption of its pioneering International Business
Companies (IBC) legislation in 1984, the British Virgin
Islands has become a high quality international financial
center, and is regularly undertaking programs to expand
its financial service offerings to meet the needs of
international financial markets.
In the 12 years since the adoption of its IBC Act, the
BVI has firmly established itself as the world’s
premiere corporate domicile, with more than 210,000 companies
registered in the jurisdiction. The BVI has undertaken
an extensive legislation and regulatory program starting
with the adoption of new trust legislation in 1993 and
new insurance legislation and regulations in 1994 and
1995. In 1996 the legislative calendar included the passage
of legislation on mutual funds and limited partnerships.
Based on the BVI’s integrity, flexibility and
responsiveness to the interest of the financial community,
it has become the only Caribbean Dependent Territory
to which the British Government has devolved responsibility
for developing and managing its own financial services.
The BVI’s operating advantages are:
• uncomplicated, swift approval procedures.
• innovative, flexible legislation.
• zero tax rate for offshore entities, low tax rate
for BVI entities;
and no wealth capital gains or estate taxes.
• maximum privacy and confidentiality.
• asset security, and the freedom to transfer and
merge assets.
• protection of wealth benefits, inheritance wishes
and trust interests.
• minimum requirements in relation to (for example)
the insurance of shares, designation of directors and
shareholders, and maintenance of records.
• legislative exemptions for qualified institutions.
The advantages offered by the legislation have attracted
many blue chip international service firms to the BVI.
The financial services community presently includes
six out of seven major worldwide accountancy firms,
domestic and international legal practices, on and off
shore banks, and insurance companies. International
trust and management companies are prevalent, all staffed
by a well trained local and expatriate labor force.
Most of the firms are members of the Association of Registered
Agents. The Association of Registered Agents a is licensed
by the BVI Government. They enjoy 24 hour, on line computer
access to the Companies Registry for the registration
and amendments to companies and corporate structure. |
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Banking
The Bank and Trust Companies Act of 1990 defines 3 categories
of bank licenses
and two categories of trust company license:
Banks
1. General Banking License:
Holders of a general banking license must have a minimum
paid up capital of $2,000,000,000 and must deposit the
sum of $500,000 with the BVI Government. The annual
fee is $20,000.
2. Class I Restricted Banking License:
Holders may not take deposits from or make investments
in or with any BVI resident except another licensee
or an IBC. Minimum paid up capital is $1,000,000,000.
A deposit to the BVI Government of $500,000 is required.
The annual fee is $8,000.
3. Class II Restrictive Banking License:
This banking license has the same restrictions as a
Class I, but can only receive funds from undertakings
named in the license. A minimum capital of $1,000,000,000
and a deposit of $500,000 with the BVI Government is
required. The annual fee is $16,000.
Private Banking
Private banking services are growing. Local trust companies
can refer their clients to on island private banks with
assurance that their clients needs will be met. It is
often advantageous in a variety of circumstances for an
off shore company and or trust, to be registered in the
same jurisdiction as that of their bank.
Substantial investments in state of the art equipment
and personnel have been made by several banks in order
to be able to offer the best banking services possible.
One bank is linked through satellite with the Reuters
information system, which is the basis for dealing in
currencies and securities.
Clients have the opportunity to take advantage of Investment
Counseling and Discretionary Investment Management services
from Private Banks
The BVI does not grant offshore banking licenses to individuals
or unproven entities. Banks with proven records are invited
to consider the BVI. Their applications can be expedited
through a local advocate or through a trust or service
management company licensed in the BVI.
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Insurance
The BVI now offers an attractive environment for a wide
range of insurance services, which includes, but not limited
to, single parent and group owned captives both direct
and by way of reinsurance, companies formed to offer cover
to Risk Purchasing Groups and Risk Retention risk insurance
program, protected life policies and annuities that are
free of attachment and credit life reinsurance companies.
In addition to its overall assets ass an international
financial center, the BVI offers a number of competitive
advantages that are specific to the insurance sector.
These competitive advantages reflect the three guiding
principles that underpinned the development of the Act
and the Regulations: responsibility, flexibility and innovation.
They include:
• Privacy - provision
of a blanket of confidentiality with appropriate gateways
for justifiable disclosures of information to assist
regulatory and law enforcement authorities in the investment
of criminal activities.
• Exemptions - provision of exemptions
offers and attractive environment for high quality insurance
undertaking, such as mutual insurance companies, offshore
captive insurance companies and major international
insurance groups.
• Balance - establishment of
an appropriate balance between the avoidance of excessive
bureaucratic and legalistic requirements and the maintenance
of the BVI’s well earned reputation for integrity
and vigilance.
• Licensing Strategy - maintenance
of a selective licensing strategy to preserve the stature
of the BVI as an up market, well regulated jurisdiction.
• Simplicity - simple, swift
procedures of the establishment and management of operations.
• Cost Competitiveness - freedom
from oppressive fiscal burdens combined with highly
competitive costs, in terms of both government fees
and operating cost.
• Government Attitudes - open
door policy of consultation and dialogue between the
Commissioner and Supervisor of Insurance and the private
sector.
For more information see members listed in the Insurance
Section. |
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Government
contact
Elton Lettsome Ag.
Supervisor of Insurance
Financial Services Department
Government of the British Virgin Islands
Road Town, Tortola
British Virgin Islands
Tel: 284-494-6430
Fax: 284-495-5016
e-mail:
commissioner@bvifsc.vg
Trust Companies
The BVI is a location of choice for reputable, well capitalized
international trust operations. The BVI legislation provides
a flexible vehicle for the establishment of trust to hold
shares in an IBC and in a variety of asserts based outside
the BVI.
By utilizing a BVI trust in combination with an underlying
company formed under the BVI’s IBC legislation,
a company gains a wide range of competitive advantages.
These advantages are based on the two guiding principles
of the BVI’s legislation: namely, protection of
the trust’s interest and assets and facilitation
of its management and operations.
The BVI Trust operations include:
• flexibility in planning.
• protection of privacy, wealth assets, and inheritance
wishes.
• tax exemptions, competitive costs, and swift,
simple procedures.
• strong network of experienced trust professionals
in the BVI.
• governmental commitment to a modern trust regime
and effective partnership with the private sector.
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Main Legislation
Provisions
The BVI’s trust legislation is based on
the English Common Law System, and the
BVI High Court follows English case law even when this
is not technically binding, except where this is specifically
varies from local legislation or case law.
It provides for three categories of trust:
•
charitable
• personal
• purpose
And two categories of trust licenses:
• General Trust License
• Restricted Trust License
Mutual Funds
Recently, the Mutual Funds Act has attracted this investment
instrument.
For further information see members listed under Financial
Sector.
Above information
provided by:
Robert Macthavious
Director of Financial Services
Financial Services Department
Government of the British Virgin Islands
Road Town, Tortola
British Virgin Islands
Tel: 284-494-4190
Fax: 284-494-5016 |
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