The International Business Company Act (The IBC Act) of British Virgin Islands is a modern piece of corporate law tailored specifically to the needs of international businesses. The Act makes it possible for the administration of an IBC to be undertaken either in the BVI or from another jurisdiction.
ADVANTAGES OF INCORPORATING IN THE BVI
Incorporation under the IBC Act of the British Virgin Islands provides the following advantages and benefits:
BVI companies are exempt from all BVI taxes and stamp duty (except for registration fees and annual license fee) even though the administration of an IBC may be from within the BVI.
There is no requirement to disburse a minimum capital.
A BVI company is required to have a Registered Agent and a Registered Office in BVI.
Both registered and bearer shares can be issued (and converted from one to another). However, whenever a company issues bearer shares it will be required to deposit them or deliver them into the custody of a custodian. There are two (2) types of custodians: an Authorized Custodian and a Recognized Custodian, both of which must be approved by the FINANCIAL SERVICES COMMISSION (FSC) of the British Virgin Islands in accordance with the Financial Services Commission Act, 2001, which will be amended to provide for an approval and recognition process. It is intended that an Authorized Custodian will be either a BVI licensed bank or trust company. In addition, an overseas company that is regulated in a jurisdiction acceptable to the Commission may also qualify as an Authorized Custodian.
It is acceptable to have only one (1) shareholder.
It is acceptable to have only one (1) director. Another company or entity may serve as the sole director.
There are no nationality requirements for directors or shareholders. They could be of any nationality or domicile.
Board meetings of stockholders/directors/officers may be held anywhere in the world and may be conducted by telephone or through electronic means. Circular resolutions are acceptable.
BVI annual license fee is very competitive.
The identity of shareholders and directors is not a matter of public record.
The Directors have the power to protect the assets of the company by transferring them to trustees, other companies or legal entities, for the benefit of the company, its beneficial owners or creditors.
Registered Agents are authorized to authenticate the signatures of directors, officers, or agent, which expedites the business affairs of the company.
e BVI legislation allows that a company incorporated outside the BVI may be redomiciled in the BVI under the “continuation” feature of this legislation.
The books and records of the company may be maintained anywhere in the world.
No accounts or annual summaries have to be filed with the Government, with the exception of the annual fee form to be completed and filed and paid by the Registered Agent in BVI.
BVI companies may merge or consolidate with other BVI or foreign companies where permitted by the law of the country of residence of the foreign company.
Any person (natural or juridical) may individually or jointly with others (in the BVI or elsewhere) incorporate an IBC by subscribing to a Memorandum and Articles of Association. The usual procedure is for a nominee to act as incorporator. Our firm, BUFETE BERROCAL, offers the service to act as the sole incorporator.
Upon registration of the company, control of the company is passed over to the beneficial owner by appointing as first director(s) (individual or corporate) that(those) indicated by the client. The director(s), in turn, arrange(s) the issuance of shares and take(s) the other decisions to commence business. Service of nominee directors/officers and/or shareholders can be discussed. The length of time required for the organization of the BVI company is of approximately five (5) working days as of the date in which final instructions are received by us.
The Memorandum/Articles of Association may be amended by either a resolution of the directors or shareholders and such amendment must be registered.
BOOKS, RECORDS AND COMMON SEAL
All BVI companies are required to have a common seal (which may be kept inside or outside BVI) and an imprint thereof must be kept at the company’s Registered Office in BVI. Seals must be used at any time the company executes a contract, which if entered between individuals, would be required by law to be in writing and under seal. A BVI company shall keep accounts and records as the directors consider necessary or desirable in order to reflect the financial situation of the company, at the Registered Office of the company in BVI or at any other place outside the BVI, as determined by the directors.
POWERS OF ATTORNEY
Any BVI company may grant General or Special/Limited Powers of Attorney to any person (Natural or juridical), to act on its behalf to execute contracts, agreements, deeds and/or any other instruments, notes or contracts. Powers of Attorney in the BVI are not a matter of public record.
CERTIFICATE OF GOOD STANDING
Certificates of “good standing” of any BVI company can be obtained from the Registrar of Companies at any time.
REGISTRATION OF SHARES
There is no public record of shareholders. Every BVI company is required to keep at least one Stock Register Sheet, and at least one copy of such must be kept at the Registered Office of the company in the BVI. The Registered Agent must be informed of any changes in the ownership of the shares at all times.
It is acceptable to have only one (1) shareholder and one (1) director. Every company is required to appoint one or more directors [natural or juridical person(s)] at the time of incorporation or within the following thirty (30) days as of its incorporation date and they could be of any nationality and domicile.
A minimum of least of one (1) President and one (1) Secretary must be appointed and one person can hold both or more offices.
Every company formed in the BVI is required to establish and maintain a Register of Directors. The name of the Directors must be kept at the Registered Office of the company and will remain confidential in our files.
TRANSFER OF JURISDICTION
Any BVI company may transfer its domicile to any foreign jurisdiction allowing such transfer.
On the other hand, any company organized under any foreign jurisdiction may continue its existence as a BVI company upon approval of the necessary resolution by its proper corporate body, or as provided by the foreign legislation. In any case, registration of the Articles of Incorporation of a foreign company with the Registrar of Companies of BVI, will enable such company to continue its existence as a BVI company, regardless of any provisions to the contrary in the laws of its previous jurisdiction.
All BVI companies (standard companies with an authorized capital of up to US$ 50,000.00) must pay an annual license tax of US$ 350.00, as of the second year of incorporation. The amount of such tax depends on the authorized capital of the company. If the annual license tax is not paid on the corresponding period, a fine will be imposed:
COMPANIES ORGANIZED DURING THE FIRST SEMESTER
The annual tax must be paid before May 30
10% late payment penalty will be applied up to July 31
50% late payment penalty will be applied up to October 31
And if tax plus fines are not paid on November 1, the company will be stricken from the record. However, it may be subsequently restored by payment of all taxes plus fines and a restoration fine of US$ 600.00.
COMPANIES ORGANIZED DURING THE SECOND SEMESTER
The annual tax must be paid before November 30
10% late payment penalty will be applied up to January 31
50% late payment penalty will be applied up to May 30
And if tax plus fines are not paid on June 1, the company will be stricken from the record. . However, it may be subsequently restored by payment of all taxes plus fines and a restoration fine of US$ 600.00.
Through its affiliate offices in the BVI, BUFETE BERROCAL can provide trusts services in the British Virgin Islands, to engage in trust business and act as a professional trustee of trusts.
We wish to inform you that the British Virgin Islands Legislative Council has recently enacted the Trustee Amendment Act (1993), a modern piece of legislation on trusts. This legislation covers important issues such as:
The law which shall govern a trust in cases of conflicts of laws.
The law that shall govern a trust in case there is a “forced heirship” provision in the law of the settlor.
Please do not hesitate to contact us if you require any further information regarding this recently enacted trust legislation.
We may also provide trustee services for trusts governed by laws other than those of the British Virgin Islands.
Quotation of expenses and fees in connection with the organization of a BVI company will be provided upon request.