In 2008, St. Vincent and the Grenadines passed
the Limited Liability Companies Act 2008 (the LLC Act). From a
tax-planning point of view its two most interesting features
are:
- The introduction of the Series LLC much used in jurisdictions
such as Delaware. The Series LLC could be a useful vehicle for
those persons wishing to establish mutual funds in a jurisdiction
but who do not wish to use an IBC structure.
- Under section 61, a judgment creditor’s sole remedy against the
economic interest of a member of an LLC is by way of charging order
and such creditor does not have any right to obtain possession of
or otherwise exercise legal or equitable remedies with respect to
the property or assets of the LLC.
At the time the legislation was passed it was
generally anticipated that it will prove attractive to (in
particular) American clients. The world economic situation and
regulatory framework has changed much since then.
1. Introduction
a. History and background
St. Vincent and the Grenadines (SVG) consist of a group of
islands approximately 100 miles due west of Barbados. The main
island is St. Vincent, the islets to the south of which consist
primarily of Bequia, Canouan, Union Island and Mustique, the home
of a large number of high-net-worth individuals.
After being a British (and sometimes French) colony for nearly
500 years, SVG gained its independence from Britain in 1979, as a
legacy of which its system of government has always been based on
the Westminster/ Whitehall model.
b. Legal system
The legal system of SVG is in many respects similar to that of
England and Wales. The local law has its foundations in English
legislation, English common law and the rules of equity. The
country has, since independence, developed its own body of
statutory laws, particularly in the areas of international
financial services.
The primary court of first instance is the High Court of
Justice, from which appeal is made to the Eastern Caribbean Court
of Appeal. Both these courts derive their jurisdiction from the
Eastern Caribbean Supreme Court Act. The court of final
appeal is Her Majesty’s Judicial Committee of the Privy Council,
based in London.