Offshore Companies: British Virgin Islands
BACKGROUND | COMPANY FORMATION | SHARES, TAXATION AND OTHER MATTERS
MANAGEMENT STRUCTURE | CORPORATE HIGHLIGHTS

BACKGROUND

The British Virgin Islands consist of 60 islands and cays having a total land area of 150 sq. km. They lie to the north west of the United States Virgin Islands and are separated from them by a channel only five kilometers wide. The neighbor with the largest land area is Puerto Rico, 96 km to the west. The islands promote two successful economies, tourism and offshore finance.

POPULATION
The largest and most heavily populated Island is Tortola, which has about 9,000 inhabitants. The capital, Road Town, is on the southern shore near Sir Francis Drake Channel. Tortola is connected by a bridge to Beef Island. There are a further 3,000 inhabitants who reside on the other islands, 1,000 of which are in Virgin Gorda which is noted primarily for its unusual and interesting scenery and rock formations.

POLITICAL STRUCTURE
The British Virgin Islands were discovered by Columbus who is said to have been so impressed by their large number that he named them "Las Virgenes" in honor of St. Ursula and her 11,000 attendant virgins. During the 16th and part of the 17th centuries the Islands harbored Dutch and English Buccaneers.

In 1672, Britain claimed Tortola. Simultaneously, Denmark asserted her sovereignty over St. Thomas and St. John; then in 1773 Denmark purchased St. Croix from France. The Danish Islands were sold to the United States in 1917 for US$ 25 million. Relations between the United States and British Virgin Islands are good.

The British Virgin Islands is an internally self-governing colony with a ministerial system of Government operating under a Constitution adopted in 1967. The Governor, appointed by the Crown, remains responsible for defense and internal security, external affairs, the civil service, the administration of the courts and finance. He continues to reserve the legislative powers necessary for the exercise of his special responsibility. However, on other matters he is normally bound to act in accordance with the advice of the Executive Council. This consists of the Governor as Chairman; two ex-officio members (the Attorney General and Financial Secretary); the Chief Minister, appointed by the Governor as the elected member who appears best able to command a majority in the Legislative Council; the Deputy Minister; and two other ministers appointed by the Governor on the advice of the Chief Minister.

Elections are held at intervals of not more than five years.

INFRASTRUCTURE AND ECONOMY
There is an excellent daily air service between the Islands and the USA. Cruise ships call in weekly to the Islands and there are freight carriers. There are excellent telephone, telex and fax facilities. Courier services are well represented on the BVI, including DHL, DTL and Federal Express, who provide a daily worldwide service.

The economy, one of the most prosperous in the Caribbean area, is highly dependent on the tourist industry, which generates about 21% of the national income.

In 1985, the Government offered offshore registration to companies wishing to incorporate in the islands livestock raising is the most significant agricultural activity. The Islands’ crops, limited by poor soils, are unable to meet local food requirements.

LANGUAGE
The official and spoken language is English.

CURRENCY
US Dollar.

EXCHANGE CONTROL
None.

TYPE OF LAW
Common Law, based on English Common Law with local modifications and local statutes.

PRINCIPAL CORPORATE LEGISLATION
The Companies Act 1985, International Business Companies Ordinance 1984 (as amended and the Banks and Trust Companies Act 1990).

COMPANY FORMATION

TYPE OF COMPANY FOR INTERNATIONAL TRADE AND INVESTMENT
International Business Company.

PROCEDURE TO INCORPORATE
Submission of the Memorandum and Articles of Association and a Certificate from the Registered Agent confirming compliance with the requirements of the ordinance.

RESTRICTIONS ON TRADING
Cannot trade within the British Virgin Islands or own real estate there. Cannot undertake the business of banking, insurance, assurance, reinsurance, fund management, collective investment schemes, trust management, trusteeship, the rendering of investment advice or any other activity that would suggest an association with the banking or insurance industries. Cannot offer its shares for sale to the public.

POWERS OF COMPANY
A company incorporated in the British Virgin Islands has the same powers as a natural person.

LANGUAGE OF LEGISLATION AND CORPORATE DOCUMENTS
English.

TIME TO INCORPORATE
Two days, but allow ten working days for receipt of documentation.

NAME RESTRICTIONS
Any name that is identical or similar to an existing company, or any name that suggests the patronage of the Royal Family or the Government of the British Virgin Islands.

LANGUAGE OF NAME
Whilst the name of company can be in any language, the documentation will be in English. Any name in a language other than English must be accompanied by a translation to ensure that the name is not restricted.

REGISTERED OFFICE REQUIRED
Yes, must be maintained in the British Virgin Islands, and must be maintained at the office of a licensed trust and management company.

NAMES REQUIRING CONSENT OR LICENSE
Bank, building society, savings, loans, insurance, assurance, reinsurance, fund management, investment fund, trust, trustees, Chamber of Commerce, university, municipal or their foreign language equivalents.

SUFFIXES TO DENOTE LIMITED LIABILITY
Limited, Corporation, Incorporated, Sociètè Anonyme, Sociedad Anonima or their relevant abbreviations.

DISCLOSURE OF BENEFICIAL OWNERSHIP TO AUTHORITIES
No.

SHELF COMPANIES
We have a number of existing companies (both aged and new) for sale and immediate delivery. These companies are "clean", that is to say, they have never traded nor engaged in any transaction whatsoever.

SHARES, TAXATION AND OTHERS

AUTHORIZED AND ISSUED SHARE CAPITAL
The normal authorized share capital is US$ 50,000 divided into 50,000 shares at US$1.00 each, this being the maximum share capital for the minimum duty payable upon incorporation and annually thereafter. The share capital may be expressed in any currency. The minimum issued capital is one share of no par value or one share of par value.

CLASSES OF SHARES PERMITTED
Registered shares, bearer shares, shares of no par value, preference shares, redeemable shares and shares with or without voting rights.

BEARER SHARES PERMITTED
Yes.

TAXATION
An International Business Company does not pay any tax on its worldwide profits to the British Virgin Islands authorities.

DOUBLE TAXATION AGREEMENTS
The British Virgin Islands has treaties with Japan and Switzerland, although they have limited benefit and are not applicable to offshore business.

LICENSE FEES
Companies with an authorized capital up to US$ 50,000 pay US$ 300 per year.

Companies with a share capital more than US$ 50,001 pay the sum of US$ 1,000 per year.

Companies with a share capital that does not exceed US$ 50,000 and having some or all of its shares with no par value pay the sum of US$ 350 per year.

FINANCIAL STATEMENT REQUIREMENTS
Whilst there is no requirement to file audited accounts with the authorities, a company is required to keep financial records which reflect the financial position of a company.

MANAGEMENT STRUCTURE

DIRECTORS
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. Directors may hold meetings in any country and they may attend such meetings by proxy.

COMPANY SECRETARY
A company secretary must be appointed. The company secretary may be a natural person or a body corporate. They can be of any nationality and need not reside in the British Virgin Islands.

SHAREHOLDERS
The minimum number of shareholders is one.

SHAREHOLDER MEETINGS
Shareholders may hold their meetings in any country and they may attend such meetings by proxy.

REGISTERED OFFICE
The Registered Office should be in the British Virgin Islands.

SEAL
The Company Seal is mandatory.

CORPORATE HIGHLIGHTS

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