Economy and Infrastructure of BVI
The economy, one of the most prosperous in the Caribbean area, is highly dependent on tourism, which generates about 45% of national income. There is a daily air service between the Islands and the USA. T
elecommunication facilities are excellent and courier services are well developed for the BVI business companies. There is a good commercial and professional infrastructure and the Government is actively encouraging the development of the offshore finance business. The Government has now upgraded the Companies Registry by installing state-of-the-art technology. In recent years the BVI have become an extremely popular jurisdiction due to extensive marketing, particularly by lawyers who moved from Panama during the Noriega regime and set up offices in the BVI.
The official currency on the BVI is the US Dollar, and there is no currency exchange control.
BVI company corporations
In 1985, the Government offered offshore registration to companies which had a wish to incorporate in the Islands. The principal BVI incorporation legislation is The Companies Act 1985, the International Business Companies Ordinance 1984 as amended and the Banks and Trust Companies Act 1990.
The type of BVI Company used for international trade and investment is called an International Business Company (IBC). A company incorporated in the BVI has the same powers as a natural person. Off-the-shelf BVI corporations are available. The language of legislation and corporate documents is English.
BVI incorporation procedure for an IBC includes the submission of the Memorandum and Articles of Association and a Certificate from the Registered Agent confirming compliance with the requirements of the Ordinance.
As a matter of local BVI business company law, the Company must maintain a registered office address within the BVI and must also appoint a BVI resident as registered agent. There are no specific statutory provisions governing secrecy in relation to companies but English Law, which applies within the BVI and requires that professionals would keep the affairs of their clients absolutely confidential.
An IBC is subject to the following restrictions on trading and business activities:
- A register BVI companydoes not have the right to trade within the British Virgin Islands or own real estate there;
- BVI company formationis not permitted to engage in banking, insurance, assurance, reinsurance, fund management, collective investment schemes, trust management, trusteeship, giving investment advice or any other activity that would suggest an association with the banking or insurance industries;
- A British Virgin Islands companycannot offer its shares for sale to the public.
Company names are subject to the following restrictions:
- A BVI Companycannot use a name that is identical or similar to that of an existing company.
- BVI Company formationcannot use any name that suggests the patronage of the Royal Family or the Government of the British Virgin Islands.
- BVI corporationsnames could be in any language, although the documentation must be in English and an English translation of the name must be given.
- A BVI companyname containing such words as Bank, Building Society, Chartered, Co-operative, Savings, Loans, Insurance, Assurance, Reinsurance, Fund Management, Investment Fund, Trust, Trustees, Chamber of Commerce, University, Municipal or their foreign language equivalents require consent or a license.
- Limited, Corporation, Incorporated, Societe Anonyme, Sociedad Anonima or abbreviations thereof are the required suffixes denoting limited liability.
The minimum number of directors is one. They may be natural persons or bodies corporate. They may be of any nationality and need not reside in the British Virgin Islands. Details of the directors do not appear on the public files. The minimum number of shareholders is one. No details of the shareholders appear on the public files but a register of shareholders must be kept at the BVI business company’s registered office address.
The normal authorized share capital is US$ 50,000. It is the maximum share capital to qualify for the minimum duty payable upon BVI incorporation and annually thereafter. The share capital may be expressed in any currency. The minimum issued capital is one share without par value or one share with par value. The following classes of shares are permitted: registered shares, bearer shares, shares of no par value, preference shares, redeemable shares and shares with or without voting rights.
Annual Taxation and Fees
A BVI company tax does not exist on its world-wide profits, when we talk about IBC. The British Virgin Islands company has treaties with Japan and Switzerland, although they are of limited benefit and are not applicable to offshore business.
The license fees depend on the company’s share capital:
- BVI business companieswith an authorized capital of up to US$ 50,000 pay US$ 350 per year;
- BVI companieswith a share capital of over US$ 50,001 pay US$ 1,100 per year;
- BVI corporationswith a share capital not exceeding US$ 50,000, whose some or all of shares without par value, pay US$ 350 per year;
- A penalty of up to 50% of the annual Government fee will be incurred if the license fee is not paid when due.
Though there is no requirement to file audited accounts with the authorities, a BVI business company is required to keep financial records that reflect its financial state.