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BRITISH VIRGIN ISLANDS

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. Except for Anegada, which is a flat, coral island with little soil, the Islands are hilly. Their greatest tourist attraction is their superb beaches.

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 world-wide 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.

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.

Language: The official and spoken language is English.

Currency: US Dollar.

Exchange Control: None.

Law: Common Law, based on English Common Law with local modifications and local statutes.

Corporate Legislation: The Companies Act 1985, International Business Companies Ordinance 1984 (as amended and the Banks and Trust Companies Act 1990.

   Reasons Behind the Success of the BVI Financial Services Industry

The British Virgin Islands (BVI) has been a true phenomenon for the establishment of offshore companies in recent years.
Despite a trend by other offshore financial centers to replicate the pioneering International Business Companies Act legislation introduced by the BVI in 1984, the BVI has remained the clear leader in this field. Since 1984 almost 280 000 IBC's have been incorporated, approximately 40,000 British Virgin Islands IBCs were formed in 1996 alone.
It is instructive to assess the reasons behind this continuing success.
       

   Advantages of a non resident IBC in British Virgin Island

  • Setting up, formation is affordable and prompt.
  • Complete business privacy and confidentiality.
  • No requirement to disclose beneficial owners.
  • Income derived outside of BVI is not taxed.
  • No requirement to file annual returns or financial statements.
  • No requirement to hold annual general meetings of shareholders or directors.
  • No paid - in capital required.
  • Minimum registration fee on capital.
  • IBC's need not have more than one director.
  • IBC's may issue shares in any one or more currencies.
  • Bearer shares may be issued at owner's option.
  • BVI corporation can be managed from any place of the world.
  • Government does not control BVI corporation activities.

   International Business Company - IBC

Incorporation Procedure: Submission of the Memorandum and Articles of Association and a Certificate from the Registered Agent confirming compliance with the requirements of the ordinance.

Trading Restrictions : Cannot trade within the British Virgin Islands or own real estate there. Cannot undertake the business of banking, insurance, assurance, re-insurance, 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.

Time Schedule: Three days, but allow two weeks for receipt of documentation overseas.

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.

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.

Names Requiring Consent or License: Bank, building society, savings, loans, insurance, assurance, re-insurance, fund management, investment fund, trust, trustees, Chamber of Commerce, university, municipal or their foreign language equivalents.

Registered Office: must be maintained in the British Virgin Islands, and must be maintained at the office of a licensed management company.

Suffixes to Denote Limited Liability: Limited, Corporation, Incorporated, Sociètè Anonyme, Sociedad Anonima or their relevant abbreviations.

Beneficial Ownnership Disclosure To Authorities: No.

Authorized And Issued Share Capital: The normal authorized share capital is US$ 50,000 with all of the shares having a par value, 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: 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 world-wide 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: While 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.

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.

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.

The incorporation package contains the following:

  • Preparation and filing of Incorporation of Association with the Registrar of Companies to create and incorporate the International Business Company (IBC).
  • Appointment and payment of a registered agent and registered
  • Preparation of the initial Minutes, filing of the Notice of Registered Office, and issuance of Share Certificates.

You will receive a full set of apostilled corporate documents. The documents prepared allow confidential ownership of the company and are ready for the transfer to a new owner.
(You will receive blank share certificates and resolution appointed first director with blank space).

   Confidentiality Enforced By Law

The only documents of an IBC on public record are the Certificate of Incorporation and the Memorandum and Articles of Association. The address of the registered BVI office is shown, but share registers can only be disclosed to members with the permission of the Directors or the court. 

 


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