While BVI registered agents have always maintained Beneficial Ownership records, to comply with the requirements of the Anti-Money Laundering Code of Practice, the Government of the British Virgin Islands has passed new legislation this month that will require each registered agent to maintain a database of beneficial ownership for all BVI companies that the registered agent provides services to. The database, known as the Beneficial Ownership Secure Search (BOSS) System, is being rolled out so that the BVI can comply with its obligations under the UK Exchange of Notes agreement entered into with the UK in April 2016.  This legislation will come into force on 30 June 2017.
 
Prior to this if there was an investigation, one of the Competent Authorities in the BVI, would issue a notice to the registered agent to produce information, with the recipient having a statutory obligation to comply within a short time frame.  Under the BOSS system, registered agents must maintain their own database of beneficial ownership information.  This database can be searched by designated BVI law enforcement officers after a formal request from one of the BVI competent authorities - the BVI Financial Investigation Agency, the BVI Financial Services Commission, the BVI International Tax Authority and the BVI’s Attorney General’s Chambers.   A BOSS search may be requested by a BVI Competent Authority solely to assist the BVI to comply with its obligations under the UK Exchange of Notes.  The initial request would need to originate from the UK authorities.
 
“Beneficial Owners” are defined as the natural persons who ultimately own or control twenty five or more percent of the shares or voting rights of the BVI company. Where there are no beneficial owners meeting the twenty five percent ownership definition, the beneficial owners will be deemed to be the natural persons who otherwise exercise control over the management of the BVI Company, which will include directors, settlors of trusts, personal trustees, insolvency practitioners and executors of the estate of a deceased person.  Exemptions have been established for exchange listed entities, Mutual Funds, regulated entities and sovereign states.
 
The registered agent must enter the following basic information for every Beneficial Owner that is a natural person and meets the definition: name, residential address, date of birth and nationality.
 
Going forward:
 
1. Every BVI company now has a statutory obligation to identify any person who is a Beneficial Owner and notify the Registered Agent within 15 days.  Failure to comply with these obligations is an offence, subject to penalties on summary conviction not exceeding $40,000 or on indictment to a fine not exceeding $250,000.
 
2. Companies that were struck off the Register for non-payment of license fees prior to 1 January 2016 have been excluded, but all companies struck off the Register for non-payment of license fees after 1 January 2016 are subject to the provisions of this Act.
 
3. Every BVI Company is required to notify its Registered Agent of a change of beneficial ownership within 15 days of becoming aware of a change.  Failure to comply with these obligations is an offence, subject to penalties on summary conviction not exceeding $5,000 or on indictment to a fine not exceeding $10,000.
 
4. Registered Agents are required to update their database within 15 days of being notified of a change of any of the prescribed information relating to beneficial owners.  Failure to comply with these obligations is an offence, subject to penalties on summary conviction not exceeding $20,000 or on indictment to a fine not exceeding $40,000.

Should you have any questions please contact your CPM Client Relationship Manager.  We will be pleased to assist.

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