The BVI Business Companies (Amendment) Act was gazetted on the 5 January 2016. The aim of the Act is to ensure that the BVI corporate vehicle is modern and well suited for current conditions and international standards. It is also intended to provide for greater flexibility and certainty for those operating BVI Companies.
We have highlighted certain amendments which include:
- A new requirement to file a register of directors with Registrar of Corporate Affairs. The new provisions in relation to the register of directors comes into force on 1 April 2016, all other provisions are effective 15 January 2016We have already noted this requirement in an earlier article but now wish to highlight further aspects of the amendment.
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- A copy of the register of existing companies has to be filed with the Registrar by 31 March 2017(although it is possible to obtain an extension of up to 6 months) whilst new companies will need to file within 14 days of appointment of the first directors.
- There is no requirement to file a register of members.
- Any changes to the board need to be filed within 21 days of a change.
- Please note that the register is not a public document and remains confidential. The register may only be obtained by the company itself, its registered agent, by court order or a request by a competent authority imposed under an automatic exchange of information treaty or FATCA or CRS requirement. The requirement is a follow on to the FATF requirement to maintain director information on a register. This puts the BVI in the forefront of international compliance in this regard.
- Any company that fails to file such a register within the time period mentioned (or any extension) mentioned above will incur a penalty of $100, and a further $25 per day after the original deadline until filed.
- The register is also required to include additional information on the director, to include residential address, date of birth;
- and nationality for an individual and business address and place of incorporation of a corporation.
- Companies listed on a recognised stock exchange are allowed to dispense with the requirement to maintain a register of members with the info required under the Act. Instead the company itself can determine the requirements that allow it to be listed on a recognised exchange. The benefits to this will allow a listed company to record information on the shareholder register such as the identity of any person whose shares are held by broker or nominee services, or where the interest in the shares is based on a disclosure notice. We attach the list of recognised exchanges here. Furthermore shares listed on such an exchange can be transferred without a written instrument of transfer in accordance with the relevant stock exchange rules.
- Shares issued as bonus shares or non-cash consideration. Bonus shares are deemed to have been issued as fully paid unless otherwise provided in the article of association. In order to simplify the issue of shares for a non-cash consideration, a resolution needs to state that the amount credited for the value of the shares is in the opinion of the directors not less than the amount credited for the issue of the shares.
- Registered agents acting on instructions from directors are entitled to act on instructions as set out in a resolution and are not obliged to seek out instructions from their client of record, unless a company’s M & A state otherwise. We welcome this amendment as providing clarity to agents and simplifying corporate transactions. Furthermore, a registered agent must accept the appointment or removal of a director of a BVI company by the shareholders of that company.
- Records to be kept. BVI companies have always had to maintain records of the company at the office of the registered agent or at such other place inside or outside of the BVI as determined by the directors. If the company’s records are not kept at its registered agent’s office, the registered agent must keep a record of the name and physical address of the person who retains these documents on behalf of the company. The extent of these records and further documentation has now been clarified. This includes accounts and records such as underlying invoices, contracts and similar documents in relation to monies received and expended. All sales and purchases of goods as well as the assets and liabilities of the company. These documents must be retained for a period of 5 years from the date of completion of the transaction or the termination of a business relationship to which the documents apply. If not kept at the office of the registered agent, the company must supply the registered agent with that address and the name of the person controlling the documents. The penalty for contravening this section is a massive $50 000.
Should you require further information then please contact:
Miles Walton
miles@osiristrust.com | www.osiristrust.com
Telephone: +1 284 494 9820