Company Formation in BVI
General information
The British Virgin Islands comprise an archipelago of over 40 islands, 16 of which are inhabited. These islands, discovered by Christopher Columbus, earned their name “Las Virgenes” in homage to St. Ursula and her 11,000 attendant virgins. Situated northwest of the United States Virgin Islands, the largest neighboring landmass is Puerto Rico, located 96 km to the west. The islands, with the exception of Anegada, characterized by its flat reef-surrounded coral limestone terrain, are hilly and enjoy a subtropical climate. Their primary allure lies in their stunning beaches, making them a top tourist destination.
The British Virgin Islands boast an excellent daily air service connecting the islands to the USA, and cruise ships make weekly stops. Furthermore, freight carriers facilitate trade.
The BVI’s economy, which is among the most prosperous in the Caribbean region, relies heavily on tourism, contributing approximately 21% of the national income. In 1984, the government introduced offshore registration for companies seeking incorporation in the islands. By 2006, the number of incorporated companies exceeded 750,000, with over 51,000 incorporated in the first three quarters of 2006 alone, solidifying the British Virgin Islands’ status as a premier offshore jurisdiction. Notably, all five of the largest offshore law firms in the Caribbean region have a presence in the BVI, and the legal profession continues to expand in the territory. The Finance Sector and Ship Registration now contribute approximately 50% of government revenue.
BVI Company Formation services provided by TBA offer unparalleled simplicity! Business Companies, abbreviated as BCs, are entities registered in the British Virgin Islands (BVI) under the International Business Companies Act of 2004. (It’s worth noting that all companies formerly registered under the International Business Companies Act of 1984 automatically became subject to the BVIBC Act as of January 1, 2007).
BVI Business Companies are highly sought-after offshore entities due to their straightforward administrative procedures, adaptability, tax-exempt status, and their widespread acceptance and recognition within the global financial community. It’s important to emphasize that BVI BCs are prohibited from owning real estate in the BVI, except for leasing office space. Additionally, they are not authorized to engage in banking or trust activities (unless licensed under the Banks and Trust Companies Act of 1990) or insurance or reinsurance operations (unless licensed within the BVI for such activities). However, BVI BCs are free to partake in any lawful activity not forbidden by BVI laws, provided it aligns with the restrictions set forth in their Memorandum of Association.
Setting up your Business Company in BVI
Procedures
Language
English is the official and predominant language.
Currency
The official currency is the US Dollar.
Type of law
The legal system is Common Law, primarily based on English Common Law, with local adaptations and statutes.
Exchange control
There are no exchange control regulations in place.
Principal corporate legislation
The key corporate legislation includes the Companies Act (Cap. 285), BVI Business Companies Act of 2004 (referred to as the BVIBC Act), which applies to all companies previously incorporated under the International Business Companies Act of 1984, automatically transitioning to the BVI BC Act starting from January 1, 2007. Additionally, the BVI Business Companies (Amendment) Act of 2012 is also relevant.
Procedure to incorporate
To initiate the incorporation process, submission of the Memorandum and Articles of Association along with a Certificate from the Registered Agent confirming compliance with the ordinance is required.
Restrictions on trading
BVI companies face specific trading restrictions, including the prohibition of trading within the British Virgin Islands or owning real estate within the territory. Moreover, they cannot engage in activities related to banking, insurance, assurance, reinsurance, fund management, collective investment schemes, trust management, trusteeship, the provision of investment advice, or any other activities implying an association with banking or insurance industries. Additionally, offering company shares for public sale is not permitted.
Powers of the company
A company incorporated in the British Virgin Islands is endowed with the same legal powers as a natural person.
Shelf companies available
Yes, shelf companies are available for purchase.
Language of name
Company names must adhere to the Latin Alphabet. Any name in a language other than English must be accompanied by a translation to ensure that the name does not infringe naming restrictions. Detailed guidelines regarding the use of foreign characters in naming BVI Business Companies are outlined in the BVI Business Companies (Amendment) Act of 2012.
Registered office required
Yes, a registered office must be maintained within the British Virgin Islands, and it must be situated at the premises of a licensed management company.
Time to incorporate
The incorporation process typically takes two days to complete.
Name restrictions
Company names must not be identical or too similar to existing companies’ names. Names that suggest a connection with the Royal Family or the Government of the British Virgin Islands are also prohibited. The BVI Business Companies (Restricted Company Names) Notice of 2013 specifies the restricted words or phrases, totaling 217, whose use is not allowed.
Names requiring consent or license
Names implying associations with banking, building societies, savings, loans, insurance, assurance, reinsurance, fund management, investment funds, trusts, trustees, Chambers of Commerce, universities, municipalities, or their foreign language equivalents necessitate prior consent or licensing.
Suffixes to denote Limited Liability
Companies can employ suffixes such as Limited, Corporation, Incorporated, Société Anonyme, Sociedad Anónima, or their relevant abbreviations to indicate limited liability.
Disclosure of Beneficial Ownership to Authorities
No requirement exists for companies to disclose beneficial ownership information to authorities.
BVI Company Compliance
Share issue
The typical number of shares issued is 50,000, all with a designated par value. This represents the maximum share issuance for the minimum duty required during incorporation and annually thereafter. These shares can be denominated in any currency. Alternatively, a minimum of one share can be issued, either as a no-par value share or a par value share.
Permissible Classes of Shares
Companies can issue various classes of shares, including registered shares, no-par value shares, preference shares, redeemable shares, and shares with or without voting rights.
Taxation
Business Companies are not subjected to taxation on their global profits by the British Virgin Islands authorities.
Double taxation agreement
While the British Virgin Islands have double taxation treaties with Japan and Switzerland, it’s important to note that these agreements offer limited benefits and are not applicable to offshore business activities.
Financial statement required
Although there is no obligation to submit audited accounts to the authorities, the BVI Mutual Assistance (Tax Matters) (Amendment) Act of 2012 mandates that companies maintain reliable accounting records for a minimum of five years from the date of each transaction. These records should contain sufficient information to elucidate the company’s transactions and provide a reasonable understanding of its financial position. The Registered Agent must keep a written record of the physical location where these accounting records are stored for each company.
Licenses fees
License fees for BVI Business Companies were modified through secondary legislation enacted by the Cabinet, effective from January 1, 2018. Notable changes include an increase in the incorporation fee for standard companies authorized to issue up to 50,000 shares, which rose from $450 to $550. For companies authorized to issue more than 50,000 shares, the fee increased to $1,350.
Directors
A minimum of one director is required, and directors can be natural persons or corporate entities of any nationality, without the necessity of residency. A Register of Directors must be maintained at the Registered Office, and any updates to the Register should be promptly communicated to the Registered Office within 15 days of the change. Failure to comply with this requirement may result in a fine of US$10,000.
Company secretary
While a company secretary is not mandated by the Act, it is customary to appoint one to facilitate administrative tasks. An imprint of the Company Seal must be kept at the Registered Office, and failure to do so could result in a fine of US$10,000. If the Minute Books containing records of meetings involving members and directors are not stored at the Registered Office, the alternate address where these books are held must be provided.
Shareholders
The minimum number of shareholders is one. A Register of Members must be maintained at the Registered Office, and any changes to this Register should be reported to the Registered Office within 15 days of the modification. Non-compliance may lead to a fine of US$10,000.
BVI Company
Key corporate features
General information
- Company Type: Business Company (BC)
- Legal Framework: Common Law
- Availability of Shelf Companies: Yes
- Company Establishment Timeframe: 2 days
- Corporate Taxation: None
- Double Taxation Treaty Access: Not applicable
- Government Fees for Issued Shares up to 50,000: US$550
- Government Fees for Issued Shares exceeding 50,001: US$1,350
Share capital or equivalent
- Standard Currency: US Dollar (US$)
- Permitted Currencies: Any
- Minimum Paid-Up Capital: US$1
- Typical Number of Shares Issued: 50,000
Directors
- Minimum Number of Directors: One
- Local Director Requirement: Not required
- Allowance for Corporate Directors: Yes
- Accessibility of Director Records: Not publicly accessible
- Meeting Location Flexibility: Meetings can be held anywhere
Shareholders
- Minimum Number of Shareholders: One
- Accessibility of Shareholder Records: Not publicly accessible
- Meeting Location Flexibility: Meetings can be held anywhere
Company secretary
- Secretary Requirement: Optional
- Local or Qualified Secretary: Not required
Accounts
- Preparation Requirement: Yes
- Audit Requirement: No
- Filing Requirement for Accounts: Not required
- Public Accessibility of Accounts: Not publicly accessible
Other
- Annual Return Filing Requirement: Not required
- Change of Domicile Permitted: Yes
Our company licensing services
— What we do and do not do
Our company is EXCLUSIVELY engaged in assisting worldwide clients, either individuals or corporate entities, to get duly and properly licensed with local Regulators and Financial Authorities to get respective official licenses to legally carry out their cryptocurrency or financial related business activities.
TBA & Associates Tax Business Advisors does not provide or carry out any sort of Cryptocurrency or Financial services!
Disclaimer: While TBA & Associates strives to make the information on this website as timely and accurate as possible, the information itself is for reference purposes only. You should not substitute the information provided in this article for competent legal advice. Feel free to contact TBA Customer Services for advice on your specific cases.