An Analysis Of BVI Corporate Law

By Kevin Wagner


Laws are part and parcel of the norms and cultures of all countries, with individuals and corporations alike mandated to adhere to certain codes of conduct. While regulations may not be the same in all countries, there are some that are universally recognizable. Companies that are based in the British Virgin Islands ought to abide by the stipulations of the BVI corporate law formulated in 2004 and amended in the year 2015.

It is most notable for its wholesome inclusivity, with all sorts of companies getting room to operate in the country. This inclusivity works as an incentive that lures many international corporations to set base locally. Limited liability companies hold the record for being the most popular business entities within the BVI. Others that are part of the fray are unlimited corporations and corporations limited by guarantee.

All individuals who wish to register their companies in the territory must do so through the Financial Services Commission. This is the sole body mandated to issue registration certificates. Besides registration, the commission is also tasked with the regulation and supervision of all local financial services.

The conditions for registering a company differ slightly from what is common in most countries. For starters, the only people who can make formal applications for incorporation are registered agents. Ordinary people are not allowed to fill paperwork and approach the commission for this purpose.

There are a plethora of steps that come before the issuance of an incorporation certificate. Firstly, one ought to identify a suitable company name. The law is quite clear on this, with applicants required to present names that are unique and have no similarities to the names of other existing companies.

Next, one ought to draft a memorandum of association. This is where all the crucial details about the company are laid bare. Simply put, it is its constitution. It must clearly provide details about the type of the entity, its regulations and share capital distribution.

All companies are also required to have a physical address. In addition to this, they must have registered agents in place. It is also mandatory to have an elected director in all corporations. Those that violate any of these statutes are often struck off the list of companies and have their certificates of incorporation revoked.

There are many other conditions that corporations must meet annually. They include accounting records, audit reports, registers, shareholder meetings, financial statements and license fees. License fees can be paid one of two times in a year, this being before the last day of November or May, albeit depending on the date of incorporation.

The tax laws in the country are generally known to favor businesses, a factor that explains why many investors favor the location. For example, there are zero taxes on capital profits. Furthermore, VAT is not recognizable under the law. The best part is that the authorities have no double taxation partnerships with other nations.

All said and done, setting up a company locally is relatively easy. It is a recommended destination for investors who want to avoid crippling government bureaucracy. Once you identify a registered agent to help you out, you should be good to go.




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