Important Amendments to the British Virgin Islands (BVI) Business Companies Act of 2004
The BVI Business Companies Act of 2004 has been amended by the BVI Business Companies (Amendment) Act of 2015. This amendment has come into effect on the 15th January 2016. The key amendments mainly relate to the following highlighted areas:
Register of Directors (ROD):
In the case of a new company, this Register must be filed with the BVI Registrar within 14 days from the appointment of the first company director, as of the 1st April 2016. For existing companies, the Register is to be filed between the 1st April 2016 and the 31st March 2017. An extension to the stipulated deadline may be obtained under valid circumstances.
In addition, changes to the presented ROD must be filed within 21 days of the day of change, while failure to file the ROD within the stipulated time frame without having obtained an extension will result in a $100 penalty as well as $25 fine to be incurred daily for each day of failure to submit the Register.
It is important to know that the filed ROD shall only be made accessible to the respective company and its Registered Agent. Third parties will only be able to access the Register if they obtain the written approval by the company. The only other circumstance in which third parties are able to access the Register is if a Court Order or a written request by another competent authority is obtained.
Records and Underlying Documentation
The relevant company records are to be kept for the period of 5 years, along with sufficient financial documentation clearly showing and explaining the company’s financial position at any given time along the 5 years.
The documentation includes:
- Sums of money received and spent by the company along with all the relevant receipts,
- Purchases and sales of goods by the company,
- Assets and liabilities of the company.
If such records and documentation are kept at a different address than the company’s registered office or agent address, this must be visible on the documentation, along with the name of the person responsible for the maintenance of these records.
Failure to comply will be penalised with a $50,00 fine that will be incurred by both Registered Agent and the company as opposed to the company only as per previous regulations.
Striking Off a Company
The new time frame within which a struck off company can be restored is 7 years as opposed to 10 years as per the previous rules. After 7 years, a struck off company will officially be deemed as dissolved and can no longer be restored.
Registered Agent Acting Upon Directors’ Resolution
A company’s Registered Agent is able to act according to directors’ instructions upon receiving a copy of the resolution by the directors of the respective company.
Arbitration
A company’s Articles of Association may now provide for specific disputes to be settled through arbitration.
Absence of Company Seal on Documents
The sole fact that a company’s seal may be absent from an instrument or deed does not render the instrument invalid. This includes contracts, deeds, agreements, wills, orders, warrants, letters, as well as any other document demonstrating the intent of making a formal arrangement.
Premium Services at the BVI Registry or Corporate Affairs to be Introduced
As of the 1st December 2015, the FSC established a Premium Services Department within the Registry in order to provide a customised and efficient service pertaining to a select set of transactions, which will attract additional processing fees.
Such transactions include:
- Continuations into and out of the British Virgin Islands,
- Amendments to M&A,
- Changes in authorised shares,
- Registrations of Charge and Merger
