Registration of Company on British Virgin Islands

Company registration in the BVI

The British Virgin Islands (BVI) is a British overseas territory located in the Caribbean (the Francis Drake Channel), it is bordered by the east to Puerto Rico. The capital city of the British Virgin Islands is Road Town with a population consisting of over 30,000 people. The official currency of the British Virgin Islands (BVI) is the United States Dollar (USD) with the English language as its official language.

The BVI Business Companies Act 2004 is the legislative framework regulating Company formation, regulation and other incorporation related activities in the British Virgin Islands. The government is a political democracy under a constitutional monarchy.

Company formation in BVI is a solid source of annual revenue to the government of this jurisdiction as it contributes more than 50% obtained from licensing fees paid by the companies. The BVI is a reputable offshore regulatory jurisdiction. The BVI Financial services commission is an autonomous regulatory authority responsible for company activities and other related financial services on the Island.

Benefits of Company Formation in BVI

• Political and economic stable state;
• Ease of incorporation, operation and maintenance;
• A classic offshore jurisdiction;
• Tax-free regime;
• Minimum of one shareholder;
• No minimum paid-up share capital requirement;
• Confidentiality of the directors, shareholders and beneficiaries’ details (not available to the public);  
• Non-residents are allowed to register offshore companies in the BVI in any sphere of activity permitted by the legislation of the state;
• Offshore companies in the BVI can be established by non-residents or citizens of the country, and it is possible to re-register the company outside the borders of the islands;
• Nominee service is allowed;
• Asset protection.

Business in BVI: Types of Companies

• International Business Company and shelf corporations (both available).
• The company limited by shares;
• The company limited by guarantee;
• Hybrid company (limited by guarantee but has the right to issue shares);
• Unlimited company (without the right to issue shares);
• A segregated portfolio company (Protected cell company).

 The following are certain conditions that must be met depending on the type of business companies, they include:

• The company name should end with the following any of these suffixes indicating its form of activity, namely: Limited, Incorporated or Corporation (LTD, Inc and Corp, respectively). The regulation admits the preparation of names in Chinese;
• The amount of the authorized capital equals to US$50,000. The contribution is made to a local bank account by the founder (not mandatory);
• Issue of registered shares is allowed, and bearer shares are not used;
• When registering a company in the BVI, the company should consist of the following persons: 1 shareholder and 1 director. A Legal entity can act as the latter, and the appointment of nominee directors and shareholders is permitted;
• Zero taxation does not require audit and submission of annual reports.

Business in BVI: Taxes

1. Corporate tax rate - 0%.
2. Personal income tax - 0%.
3. Value Added Tax rate - 0%.
4. No taxation treaty access.
5. BVI signed Tax Information Exchange Agreements.

Bookkeeping in the British Virgin Islands

• Account filing requirements - NO
• Statutory audit requirements - NO
• Annual return filing requirements - NO

Company Formation Requirements for BVI

• Certificate of incorporation;
• Articles and Memorandum of Association;
• Minimum of one shareholder and director;
• A legal registered office;
• A legal registered agent;
• Directors Acceptance Letter;
• Share(s) certificate;
• Articles and Plan of Consolidation;
• Notarized passport copies.

It is important to note that the procedure for company registration in BVI is quite straightforward but the company legislation is constantly amended, it should be monitored and taken into account at all times. The last amended rules have been made stricter in the identification of investors coming to the jurisdiction.

Now, to complete the registration of a company in the British Virgin Islands, the beneficial owners must provide bank statements (resident bank) dating at least six months. In addition, confirmation of the registered address of the founders and their personal data is required.

Furthermore, The BVI’s Economic Substance (Companies and Limited Partnerships) Act, 2018 (BVI Substance Act) came into force on 1st January 2019. The BVI Substance Act is supplemented by the BVI’s Economic Substance Code (BVI Substance Code). This law applies to the following legal entities, they include:

• Companies and foreign companies incorporated/registered under the BVI Business Companies Act, 2004 (as amended), excluding companies which are not resident in the BVI; and
• Limited partnerships and foreign limited partnerships formed/registered under the Partnership Act, 1996 or the Limited Partnership Act, 2017, excluding limited partnerships which are not resident in the BVI or do not have a legal presence;

The following legal entities are exempted from the act, they include:

• An investment fund (within the meaning of applicable BVI legislation); or
• A non-resident company and a non-resident limited partnership.

An entity is a “non-resident company” or “non-resident partnership” if the company/partnership is resident for tax purposes in a jurisdiction outside the BVI which is not on Annex 1 to the EU list of non-cooperative jurisdictions for tax purposes.

Entities Which are Subject to The BVI’s Economic Substance Requirements

The BVI Substance Act imposes economic substance requirements on all BVI legal entities carrying any of the legalized “relevant activities” in its jurisdiction.

A legal entity incorporated or registered in the BVI will have to adhere to the BVI Substance Act.

The details of all “relevant activities” are defined in the BVI Substance Act with further clarifications seen in the BVI Substance Code.

Economic Substance Requirements in the BVI

Each legal entity which is not a tax resident outside the BVI (other than a pure equity holding entity) must, in relation to any relevant activity, carry out defined core income-generating activities in the BVI and demonstrate economic substance by reference to the following criteria with with regards to the nature and scale of the relevant activity:

• The relevant activity being directed and managed in the BVI;
• Adequate numbers of suitably qualified employees who are physically present in BVI (whether they are employed by the relevant legal entity or not and either on temporary or long-term contracts);
• Adequate expenditure being incurred in the BVI;
• Appropriate physical offices or addresses in the BVI; and
• The relevant activity is an intellectual property business requiring the use of specific equipment located in the BVI.

Enhanced Substance Requirements for Intellectual Property (IP) Activities in the BVI

A BVI entity engaging in the intellectual property business and possesses holding intellectual property assets like (but is not limited to) copyright, patents, technical know-how, trademarks, brands and goodwill. This applies to a broad range of businesses and is not restricted to IP businesses. The BVI Substance Act places enhanced requirements on entities involved in intellectual property businesses.

BVI Pure Equity Holding Entities

A BVI pure equity holding entities are entities that fall within the scope of the BVI Substance Act but have no other relevant activity other than holding equity participation in other entities earning dividends and capital gains. Pure equity holding entities are subject to reduced substance requirements under the BVI Substance Act.

BVI pure equity holding entities have an adequate substance within the BVI if they meet the following conditions, they include:

• Comply with their statutory obligations under the BVI Business Companies Act, 2004 (as amended) or the Limited Partnership Act, 2017, whichever is relevant ( for example, requirements to pay annual fees and make certain filings following corporate events); and
• Have, in the BVI, adequate employees and premises for holding equity participation and management, including those (employees) who will be responsible for the management.
• BVI reporting obligations.

All entities must file information related to their tax residency and activities, this ensures that the BVI International Tax Authority has adequate information to monitor compliance with the BVI Substance Act. They must be filed through the BVI entity’s registered agent in the BVI, who will then input the information to the BVI’s existing Beneficial Ownership Secure Search System.

How to Register a Company in BVI: The Registration Process

Step 1. Law and Trust works with the client to get the company’s name and activity approval from the Registry;

Step 2. Law and Trust works with the client to secure the Memorandum of Association (MOA);

Step 3. Law and Trust collects, prepares and files the necessary incorporation documents on behalf of the client to the relevant authorities for approval;

Step 4. Law and Trust works with the client to open a corporate bank account in BVI;

Step 5. Law and Trust deliver the certificate of incorporation personally to the client or via courier service.

BVI Company Formation FAQs

How long does it take to register a company in the British Virgin Islands (BVI)?

It takes from one week to complete the company registration in the British Virgin Islands.

How much does it cost to register a company in the British Virgin Islands?

The cost of registering a company is US$1195, the total cost includes the preparation of legal documents, company registration, payment of all taxes and fees at the time of registration and legal address for the company (a year).

What are the minimum company formation requirements for setting up in BVI?

A minimum of one director, one shareholder and the registered office address in BVI.

Does a BVI company have to file accounts or financial tax return statements?

There are no requirements to file account and financial tax return annually, nor is there the need for statutory audit.

Does a BVI Company need a legally registered office and registered agent?

A company in the British Virgin Islands must have a legally registered office and agent.

Why Incorporate with Law&Trust International?

Benefits of company registration, formation, and incorporation services with Law&Trust International in the British Virgin Islands includes:

Full range of related services: Provision of a full range of legal, corporate, government, and business intelligence related services in BVI. A detailed overview of our services includes full legal support of the company registration procedure, obtaining a legal address, interaction with the official government authorities of the jurisdiction, state fees, legal address of the company for a year, production and registration of company stamps and advising the client as part of the registration process. Opening a bank account and the cost of these services are discussed during the consultation.

Professionals and expertise of Law: Worldwide registration and legal maintenance of companies, accounting services, and audit, tax planning and optimization, trademark and patent registration. Law and Trust provide clients with the best company incorporation services.

Domestic service: Law&Trust ensure our services cover every region in BVI. Be rest assured that no matter where the new company intends to incorporate in BVI, we’ve got the location covered.

Free initial advice: Free consultation from the lawyers of Law&Trust International regarding strategies or the provision of services for analyzing and developing a legal position on an issue the client raises in BVI.

Confidentiality: Law&Trust makes use of modern technological features to keep the records and details of every client safe.

Efficiency and productivity: Strategically providing up to date personalized services to help your business succeed.

Ready for Company Incorporation?

If you are interested in registering and incorporating a company in BVI, contact Law & Trust International by simply sending an email or call now to take your business to the next level!