British Virgin Islands earned its success in the offshore services industry by adopting, as it turned out, an extremely well-written and flexible law on offshore corporations – the BVI International Business Companies Act 1984. Under this law, hundreds of thousands of BVI International Business Companies were registered during the past 22 years. The Act proved to be so good, that it was widely imitated by other aspiring offshore jurisdictions, in Caribbean and elsewhere.
The recenly adopted BVI Business Companies Act 2005 represents a further modernisation of the BVI offshore services laws. The new law successfully resolves many of the modern age problems faced by the offshore services industry, in particular the criticism against discrimination and lack of “even playing field” between domestic and offshore companies. Quite notably, the new Business Companies Act replaces the two earlier laws, which regulated domestic and offshore companies separately. Corporate income tax is now abolished for all companies, including domestic. For all practical intents and purposes, there is no legal distinction between a local BVI company and an offshore BVI company. The new BVI Business Company also represents a more sophisticated offshore corporation than the former IBC.
Apart from being virtually a tax-free company and at the same time legally qualifying as a domestic entity, the new BVI Business Company has a few more remarkable features. It does not need to state the monetary value of its authorized capital. There is no requirement to file the particulars of directors or shareholders with the Registrar of Companies – but a company may choose to do so. No financial reports or accounts are required for filing. No operational objects need to be stated in the Memorandum of Association of the company, however, the company may choose to do so by becoming a “restricted purpose company”. In reverence to the international pressures, bearer shares have been burdened by new “immobilisation” rules and much higher government fees.
For a full and detailed review of all corporate features of the BVI Business Companies, please follow the link to BVI Business Company.
The new BVI Business Companies Act 2005 features a new roster of the government registration fees. The minimum government registration fee for BVI Business Companies is $350 per year, for a company having up to 50`000 shares and no bearer shares. The government fee will go up, incrementally, to $1350 per year for a company having more than 50`000 shares of which some or all ar bearer shares, if the bearer shares are not kept with a BVI-licensed custodian. While not among the lowest in the word, BVI companies definitely remain competitive due to the good recognition and value that they represent.
For a complete list of fees and charges in relation to BVI incorporations, including the professional fees of Fidelity Corporate Services in the BVI, please click away to the BVI company pricelist.