Advantages of Registering an Offshore Company in the BVI

It would probably be safe to claim that the legislation of the British Virgin Islands is more beneficial for offshore companies than the legislation of any other country or territory. The authorities of the jurisdiction are interested in promoting their offshore services.

Today, offshore companies are registered in the BVI in accordance with the Business Companies Act that went into force on January 1, 2005. It replaced the International Business Companies Act that had been used since 1984. The new Act puts forward minimum requirements to offshore companies while giving them significant advantages. In particular, it guarantees information confidentiality and exempts offshore companies from taxes.

Admittedly, some other jurisdictions also offer serious advantages to offshore companies registered in their territories. The BVI, however, stands out for the flexibility of its legislation, the quality of its financial services, and political stability.

Reasons why you should consider establishing an offshore company in the BVI

Thanks to the advanced offshore legislation, the BVI has been a leading offshore jurisdiction over recent years with more than 650,000 companies registered on its territory.

A company registered in the BVI obtains the following competitive advantages:

Security of assets: company assets are protected from third parties, they can be transferred to another jurisdiction or to another legal entity including a trust, a foundation, an association, or a partnership;
Exemption from all local taxes: only a company registration fee and a license/ franchise fee is due;
Maximum confidentiality;
Registered shares can be kept at the company office. Please note that bearer shares are no longer allowed in the BVI;
Locally registered companies do not have to file tax returns and financial reports but they have to keep financial records anyway. These records shall be submitted on an official request from the BVI Financial Services Department. Failure to submit the records will result in a US$ 10,000 fine;
One company director is enough and it can be a natural person or a legal entity;
No requirements to the registered capital;
Company directors can transfer the company property to trustees, to another company, or to another legal entity of other types;
The requirements to company names are lax: the company name can be in any language and it has to reflect the company legal status (end in Limited, Corporation, Incorporated, Sociedad Anonima, Société Anonyme, etc. or the corresponding acronyms);
The amounts of fees and duties are not high in the BVI.

The economy of the BVI

The economy of the British Virgin Islands is the most stable and prosperous one in the Caribbean region.

The main sector of the economy is tourism – nearly 995,000 tourists visited the islands in 2023 and the expectations are even higher for 2024. They generate more than 20% of the national budget. The importance of the financial sector is constantly growing.

The BVI is also a popular jurisdiction for registering offshore companies. Nearly 40% of all offshore companies are registered in the BVI.

Passage of the Business Companies Act has brought considerable dividends to the BVI. Apart from that, the development of the business infrastructure and the broadening of the range of services has also contributed to the economic growth of the territory. The BVI is a highly competitive jurisdiction in the world market.

Good rum is made in the BVI from the sugarcane grown on the islands. Various vegetables and fruits are also cultivated.

Neither personal income nor corporate income tax is charged in the BVI. In addition, no VAT or sales tax are payable there.

There is no currency control in the BVI and neither are there any restrictions on capital movement.

Requirements for Business Companies in the BVI

The BVI puts forward the following requirements to the offshore companies registered in the jurisdiction and you can see that they are very relaxed:

One company director or shareholder is enough to register a company;
One person can act as the company director and shareholder simultaneously;
A natural or a legal person can be the company director and shareholder;
No local company directors need to be hired;
The company secretary can be of any nationality.

Confidentiality of the company UBOs information

The names of the company directors and shareholders are not available to the public in the BVI but a registered agent must have them. Failure to supply the list of their names to the agent will entail a US$ 10,000 fine.

Nominee services are allowed in the BVI, which can enhance the confidentiality of personal information.

Requirements to company shares and registered capital

Shares with or without par value can be issued;
Shares can be issued in any national currency or in more than one national currency;
The Recommended registered capital is US$ 50,000 (it can be deposited in any currency);
The company can issue a single share.

Company documentation

Companies don’t have to file accounting reports but they have to keep financial records. The records have to be detailed enough to explain the financial operations of the company if necessary.

Meetings of company shareholders and directors

Minutes of the meetings and there resolutions have to be kept with the registered agent or at any other place (inside or outside the BVI) that the company director chooses;
Meetings can be held in any country of the world;
A general meeting of shareholders can be held only on request of the Board of Directors or on request of the shareholders who hold more than 50% of the voting shares.

Restrictions on business operations conducted by offshore companies in the BVI

To remain eligible for tax exemption, an offshore company should do no business with physical or corporate residents of the BVI. However, an offshore company is allowed to carry out the following business operations in the jurisdiction:

The company can have business contacts with solicitors, trial lawyers, accountants, trust companies, management or secretarial companies, investment advisers or other similar persons or organizations doing business in the BVI;
The company can keep financial and other types of records and registers in the BVI;
Meetings of company directors and shareholders can be held in the BVI;
The company can rent an office in the BVI where it can conduct everyday business meetings or keep the company documents;
The company can own bonds, shares, or other securities of another business company registered in the BVI;
A legal resident of the BVI can hold shares of an offshore company registered in the jurisdiction.

Restrictions on business operations in foreign countries and territories conducted by offshore companies in the BVI

There are no restrictions for BVI-registered companies on conducting business operations in other jurisdictions. Please note, however, that some types of business activities such as banking and insurance, for example, need to be licensed.