The BVI Financial Services Commission (“FSC”) has recently published the BVI Business Companies (Amendment) Act, 2022 (“Amendment Act”) and BVI Business Companies (Amendment) Regulations, 2022 (“Amendment Regulations”), making the below various significant changes to the BVI Business Companies Act (“BCA”) and BVI Business Companies Regulations (“BCR”) which will come into effect on 1 January 2023.
Filing of Annual Financial Returns
According to the current BCA, all BVI companies are required to keep at their registered agent’s office or such other place the financial records that are sufficient to show and explain the company’s transactions and, at any time, enable the company’s financial position to be determined with reasonable accuracy. Under the Amendment Act, all BVI companies will be required to file with their registered agent an annual financial return (“Annual return”) which will include certain financial information of the company. The Annual Return must be filed with the registered agent within 9 months after the end of the company’s financial year. The prescribed form of the Annual Return will be published by the FSC after it has been finalized.
Under the Amendment Act, registered agents are obligated to notify the BVI Registrar (the “Registrar”) of any breach, within 30 days of the due date by providing the name of the company concerned, the relevant year to which the Annual Return relates, and the last time the company filed its Annual Return.
The registered agent will not be required to file a company’s Annual Return with the Registrar and the Annual Return filed with the registered agent will not be made public.
This new requirement to file an Annual Return will not apply to listed companies, certain BVI regulated companies and companies that file annual tax returns to the BVI Inland Revenue Department accompanied by the company’s financial statements.
Failure to file an Annual Return could lead to a penalty up to a maximum of USD 5,000.
Director’s name will become publicly available
Currently, the names and particulars of a BVI company’s directors are not publicly available. However, according to the Amendment Act, certain changes to section 118B of the BCA has been made so that the Registrar will make available, upon application, a list of directors contained in the BVI company’s register of directors filed with them. Additional costs are expected for the application.
In additional, the names of alternate directors must be included in a BVI company’s register of directors. However, the current filing requirements of register of directors remain unchanged.
Struck-off companies and dissolution
With effect from 1 January 2023, where the company is struck off the Registrar under the Amendment Act, that company is dissolved on the date the Registrar publishes a notice of the striking off in the Gazette.
Residency requirement for voluntary liquidators
A new definition of “voluntary liquidator” has been introduced. Under the Amendment Act, “voluntary liquidator” means a liquidator who is a resident in the BVI and appointed as a voluntary liquidator or an Insolvency Act liquidator. A liquidator is considered to be resident in the BVI if, prior to his or her appointment as voluntary liquidator, he or she has been living physically in the BVI for a period of not less than 180 days, whether continuously or in aggregate.
For voluntary liquidators who appointed prior to 1 January 2023, they are allowed to continue to the conclusion of the voluntary liquidation.
Restoration of dissolved companies
Under the current BCA, dissolved companies may only be restored by court order. A new restoration regime under the Amendment Act brings in a simpler process for restoring a dissolved company without applying to the Court, subject to certain conditions which including that the restoration application must be made to the Registrar within 5 years of the date of dissolution.
Resignation of registered agent
Under the Amendment Act, if the business relationship between the registered agent and the BVI company has been terminated according to the laws relating to money laundering, terrorist financing and proliferation financing, the registered agent shall resign. In addition, the period of written notice of intent to resign as registered agent of the company will be reduced from 90 days to 60 days. Where a notice of intent to resign is given and it is not rescinded, the resignation automatically becomes effective, and the registered agent shall be deemed to have resigned on the expiry of notice date.
Certificate of Good Standing
As per the Amendment Regulations, an additional statement indicating whether a BVI company has filed its Annual Return with its registered agent will appear in the Certificate of Good Standing that issued by the Registrar.
What should you do now?
- If you are considering liquidating your BVI company, please consider taking necessary actions to commence the process before 1 January 2023 so as to save cost for engaging a BVI resident liquidator.
- Please ensure the financial records of your BVI company are up-to-date so as to comply with the new requirements under the Amendment Act on filing of the Annual Return with the registered agent, i.e., Sertus.
- Please ensure the register of directors of your BVI company are complete and correct. Should there be any changes, please contact us without delay
If you have any questions regarding the above, please feel free to contact your Sertus Client Services Representative or contact us at info@sertus-inc.com. Thank you.
Disclaimer Kindly note that this note is not exhaustive but just intended to provide a general reference. This is not a legal advice and should not be regarded as a substitute for a specific legal advice that meet your circumstances. Sertus does not accept any responsibility for any errors or omissions of the contents of this note.