BVI

The British Virgin Islands (BVI) lie east of Puerto Rico in the Caribbean Sea and form part of the archipelago known as the Leeward Islands.

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NEW DEVELOPMENTS
  • All existing bearer shares issued by BVI Business Companies (or former IBCs) that have not been lodged with authorised custodians by 1 January 2010 have been disabled. Application may be made to the court to extend the time for lodging with a custodian.
  • The Securities and Investment Business Act came into force on 17 May 2010. The Act provides for the licensing, regulation and supervision of investment business, the registration and recognition of mutual funds and the control of offers of securities to the public. It also creates offences relating to insider trading and market abuse.
  • Amendments to Proceeds of Criminal Conduct Act to increase certain penalties.
  • Further amendments to the anti-money laundering regulations make better provision for the appointment of money laundering reporting officers.
  • Labour Code was passed on 27 May 2010 and received assent on 12 July 2010. It will come into force on a date to be fixed. It repealed the previous Labour Code and provides, inter alia, for adherence to international standards, minimum conditions of employment, a system of labour administration and the settlement of labour disputes. It also increases the term of work permits from one to three years’ duration.

1. Introduction

a. History and background

The British Virgin Islands (BVI) lie east of Puerto Rico in the Caribbean Sea and form part of the archipelago known as the Leeward Islands. The Islands were originally occupied by indigenous people. In the16th and 17th centuries, however, they mainly provided a safe harbour for English, Spanish and Dutch seamen. In the late 1670s, the islands came under England’s direct rule. Today, the BVI is a United Kingdom Overseas Territory, which is almost entirely self-governing and which, since 1984, has emerged as an international financial services centre.

Although the islands had enjoyed a rather chequered economic history, the introduction of a double taxation treaty between the United States and the United Kingdom afforded them the benefit of commercial activity. This, however, came to an end with the unilateral revocation of the treaty in the mid-1980s. Joint government and private sector initiatives facilitated the introduction of the International Business Companies Act (IBCA) in 1984, which energised the BVI economy and established the BVI financial services industry.

The currency of the BVI is the US dollar (USD).

b. Legal system

The legal system of the BVI is based on English common law. As varied by local statute, the principles of English common law apply by virtue of the Common Law (Declaration of Application) Act 1705 and the rules of English equity apply by virtue of the West Indies Associated States Supreme Court (Virgin Islands) Act (Supreme Court Act). The BVI is an associate member of the Organisation of Eastern Caribbean States (OECS). The judicial arm of the OECS is the Eastern Caribbean Supreme Court (ECSC), administered from St Lucia. The ECSC appoints resident High Court judges to member states. A Commercial Division of the High Court was established in 2009. It is a specialist division dedicated to the hearing of corporate, commercial and trust disputes including insolvency matters. The ECSC sits in the BVI at least three times yearly, with provisions for special hearings either in the BVI or in any other member state should the need arise. Appeals lie from the Court of Appeal to the Judicial Committee of the Privy Council in England.

Editorial board
Hélène Anne Lewis TEP
SimonetteLewis, Tortola, British Virgin Islands
Jack Husbands TEP
Walkers, Tortola, British Virgin Islands

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