British Virgin Islands                 

Full text of the The Mutual Funds Act of 1996 (British Virgin Islands)
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Choice of Jurisdiction:

The British Virgin Islands (BVI) is a British Protected Territory (Crown Colony) which became self-governing in 1967.

The advantages of establishing a fund in the BVI include:

  •     A common law system with ultimate right of appeal to the Privy Council in London.
  •     The ease and speed of incorporating without regulatory approval.
  •     The possibility to issue different classes of share with or without voting or profit participation rights.
  •     The denomination of capital in any currency.
  •     The ability to issue different classes of shares in any currency.
  •     No statutory limit on redemption rights.
  •     The protection of assets through transfer of company domicile provisions.
  •     The location of management and control may be outside the BVI.
  •     A high level of confidentiality.
  •     The ability to appoint a foreign custodian.
  •     The absence of foreign exchange controls.
  •     English as the official language.
  •     No requirement to file tax returns.

Fund Structure:

The vehicle used for the arrangements of a fund is an International Business Company. A brief summary of the ordinance (1984) is shown below: 

        

1. IBC�s are exempt from all BVI taxation and stamp duties. The only annual amounts payable to the Government are yearly license fees that range form $300 per annum to $1,000 per annum depending upon the capitalization of the company.

2. An IBC may:

  •     issue bearer shares.
  •     acquire its own shares.
  •     end its name with “Limited”, “Incorporated”, ” Corporation”, ” Societe Anonyme” or:”Sociedad Anonima” or the usual abbreviation thereof.
  •     issue share with or without par value.
  •     issue different classes of shares.
  •     have only one shareholder, which can be corporate.

  •     have only one director, which can be corporate.

3. An IBC may not:

  •     carry on business with persons resident in the BVI.
  •     own an interest in real property situated in the BVI, other than  an office lease.
  •     carry on banking or trust business unless it is licensed under the Banks and Trust Companies Act, 1990.
  •     carry on business as an insurance or reinsurance company, insurance agent or insurance broker.
  •     carry on the business as company management unless licensed under the Company Management Act, 1990.

4. The only records of an IBC available for public inspection are the Certificate of Incorporation, the Memorandum & Articles of Association, the name and address of the registered agent, and the record of payment of annual fees.