BVI News
Contact Us
Costas Christoforou
Dir: +357 22 474000
Email: costas.christoforou@cpm.com.cy
Rodoula Demetriades
Dir: +357 22 474814
Email: rodoula.demetriades@cpm.com.cy
Cyproman Services Ltd
12 Esperidon Street
4th Floor, 1087 Nicosia
Cyprus

Phone: +357 22 474000
Fax: +357 22 474808
Email: info@cpm.com.cy

Key Changes - BVI Business Companies Act

On 31 December 2015 the BVI Business Companies Act (the “Act”) amendment was gazetted.  These amendments will come into force on 15 January 2016, except for sections 118, 118A and 118B, which are the sections that address requirements to file registers of directors and set out the particulars of directors that must be contained in the register.  Sections 118, 118A and 118B will come into force on 1 April 2016.  More detailed information about the requirements for record keeping (section 98) and registration of registers of directors (sections 118, 118A and 118B) will be sent to you separately.

Sections 41(1A) and 54A address requirements for share registers for listed companies and share transfer rules for listed companies not requiring written instruments of transfer.

Section 47A provides that bonus shares be deemed fully paid at issue.

Section 59(1A) will permit companies to accept shareholders surrendering shares for no consideration.

Section 91B provides that registered agents shall act upon a valid resolution of the board of directors, intended to address the current practice where some registered agents only act on instructions of their intermediary client.

Section 92(4B) addresses law firms being able to make payments, intended to address the current practice of some registered agents not cooperating with filing changes of registered agent.

Section 98 has been amended to consolidate record keeping obligations that had been in both the Act and Mutual Legal Assistance (Tax Matters) Act within the Act.

Section 118A and 118B will require new companies to file a register of directors within 14 days of appointment of the first directors.  Existing companies have until 31 March 2017 to file a register of directors, which will be the current register of directors as at the date of filing, not the full historical register.  Where registers of directors have been filed and there are changes to that register of directors, companies have 21 days to file a copy containing the changes.  The amendments expressly state that the information shall not be made available to any person except on an order of the Court or written request of competent authorities, such as law enforcement and financial regulators. 

Section 162(2A) imposes a filing timeframe of 14 days of any change to the register of charges, currently there is no filing timeframe specified.

Section 180 codifies the Registrar’s practice of accepting a directors’ certificate confirming compliance for continuations.

Section 184(1A) will require companies continuing to another jurisdiction to release registered charges, obtain consent of the charge for the continuation or satisfy the Registry that the security interest will not be diminished or compromised.

Section 184(2) will require companies continuing to file a notice of continuance, which is currently voluntary;

Section 197(2) will permit a company that has a charge registered against it to be put into liquidation and the liquidator will have to deal with the charge/charger.

Requirements to File Registers of Directors with the Registrar of Corporate Affairs

Amendments to the BVI Business Companies Act (the “Act”) that govern the registration of registers of directors and the particulars that are to be contained in to registers will come into force on 1 April 2016. The filing of the company's register of members with the Registrar is not required and continues to be optional. 

The requirement to file the register of directors stems from the FATF 40 Recommendations, which require director information on companies to be maintained on a central register and ensures that the BVI remains compliant with international initiatives in relation to the automatic exchange of information and the fight against money laundering and terrorist financing. 

With effect from 1 April 2016 new companies will need to file their register of directors within 14 days of the appointment of the first directors of the company.  

All existing BVI companies will be required to file their register of directors with the Registrar by 31 March 2017. 

Updated registers will need to be filed with the Registrar within 21 days of a change being made. 

It should be noted that filed registers will not be publicly available and may be obtained only by the relevant BVI company, its registered agent, any other person authorised in writing by the company to have access to it, by court order or on the request of a competent authority acting in the exercise of its powers or dealing with a matter for which is has authority under an enactment.  

All BVI companies existing as at 31 December 2015 will be permitted to file their register of directors with the Registrar without incurring a statutory filing fee if they file the register before 30 September 2016.  If they file the register between 1 October 2016 and 31 March 2017 the statutory filing fee will be USD25.  Companies incorporated on or after 1 April 2016 will be required to pay a statutory filing fee of US$50 to file their registers of directors.  The statutory fee for registering any changes to a register of directors held by the Registrar will be US$50. 

A BVI company which fails to file a register of directors by 31 March 2017 or the date of an extension approved by the Registrar will incur a penalty of US$100 and for every day after the deadline that the company fails to file its register an additional penalty of US$25 per day will be applied to the company.   This penalty regime is also expected to apply to late filings of changes to a register of directors.

Statutory Record Keeping

For BVI Companies, the following documents must be kept by the company at the office of its registered agent: the memorandum and articles of association, the register of members or a copy of the register, the register of directors or a copy of the register, details of the location of the books and underlying accounting records and who maintains them and copies of all notices and other documents filed by the company in the previous ten years.

If it keeps only copies of the registers of members/directors with the registered agent, it must notify the registered agent in writing within 15 days of any changes to the registers and also provide the registered agent with physical address where the originals are maintained.

Minutes of meetings of members, directors, may be kept with the registered agent or at some other place.  If the originals are not kept by the registered agent, the registered agent must be notified of the physical address where they are kept.

BVI companies are required to keep the records and underlying documentation of the company at the office of the registered agent or at such other place inside or outside the BVI as determined by the directors of the company. 

Records and underlying documentation must be sufficient to show and explain the company’s transactions and enable the financial position of the company to be determined with reasonable accuracy.

Documents and underlying records must be retained for at least five years from completion of the transaction or when the company terminates the business relationship that the records and underlying documentation relate to.

The records and underlying documentation required to be maintained includes accounts and records such as invoices, contracts and similar documents in relation to all sums of money received and expended by the company and the matters in respect of which the receipt and expenditure takes place, all sales and purchases of goods by the company and the assets and liabilities of the company. 

Where this documentation is not kept by the registered agent, the company is required to provide the registered agent with a written record of the address where such documents are kept and the name of the person who maintains and controls these documents.  Where the location of the records or the identity of the person maintaining and controlling the documents changes, the company must provide the registered agent with updated information within 14 days of the change. 

The penalty for contravening these requirements is US$50,000.