BVI | RBCS

In 2018, the Economic Substance (Companies and Limited Partnerships) Act came into effect. Recently, the deadline for the first filings passed for the BVI International Tax Authority (ITA). ITA has now begun making targeted audit requests to verify the “relevant activities” carried out by BVI entities which have made their mandated economic substance filings.

What is ITA Looking For?

Specifically, the ITA audits are looking for:

Ø Business purpose details

Ø Relevant assets

Ø Nature of their daily business activities

However, they are also interested in details as to what steps the entity took to determine which relevant activities took place during the period of consideration.

BVI entities should therefore (under the provisions of the ES Act) maintain proper documentation concerning any legal advice they might have received in the process of making such decisions. This includes any memos containing director resolutions and relevant advice from BVI legal counsel.

Any organisation that has not already taken these measures should contact their lawyer.

Relevant Activities Must Take Place in the BVI

If you are a BVI entity and you have been determined as executing relevant activities under the 2018 ES Act (passive holding business excluded) – this includes those entities managing investments and those providing multiple interest-bearing loans – you should now be executing such business activity (including decision making) within BVI.

If you have yet to make these arrangements, it’s imperative that you talk to a lawyer to help with your transition and disclose the details to the ITA as required under the law.

The is for general information only. For specific advice about your operational circumstances, you should seek professional counsel.

How can RBCS help?

If you have any queries regarding the economic substance regime, our expert team would be happy to assist. Please click here to contact us.

January, 2016

BVI Business Companies (Amendment) Act, 2016 was gazette on 29th January 2016. According to section 118B, a company shall file for registration by the Registrar a copy of its register of directors.

Information required:

(a) in the case of an individual director, the individual’s –

(i) full name;

(ii) former name, if any, unless the former name was changed by deed poll or other legal means or disused for more than 10 years;

(iii) date of appointment as director or nomination as reserve director;

(iv) date of cessation as director or reserve director;

(v) address for the service of documents;

(vi) usual residential address, unless that address is the same as the individual’s address for the service of documents;

(vii) date and place of birth; and

(viii) nationality.

(b) in the case of a corporate director, the corporate director’s –

(i) corporate name;

(ii) corporate or registration number, if any;

(iii) registered office or principal office;

(iv) address, but if the corporate director is incorporated or registered in the Virgin Islands, its corporate or registration number only; 203

(v) date of appointment as corporate director;

(vi) date of cessation as corporate director; and

(vii) place of incorporation or registration and date of such incorporation or registration.

Timeframe

21 days from the date of appointment of the FIRST director

30 days from the date of subsequent changes (including newly appointed director, resignation, or change of particulars)

Resolution Template (for appointment) - click to download

Need Help? Contact us at info@rbcs.com.hk

ITA Audit Against BVI entities is Started

BVI | Filing Particulars of Directors

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