The BVI for many years has been able to maintain its position as one of the world’s pre-eminent and leading financial hubs. This is due to its reputation as being a well-regulated international finance centre where great steps are taken to ensure that the industry is compliant with the highest international regulatory standards and best business practices. This however is a moving target because international regulatory standards and procedures are constantly evolvingin order to keep pace in the fight against money laundering and terrorist financing. To ensure its continued success, it is important that BVI’s legislation keeps pace with these requirements.
On October 15, 2015 the Premier’s Office of the BVI issued a release announcing some upcoming amendments to the Eligible Introducer Regime. This without a doubt is due to prolonged, sustained pressure from the UK Government, the G8 and other international regulatory agencies on the Crown Dependencies and Overseas territories to establish a central register of beneficial owners.
In determining beneficial ownership of a company, we drill down and bypass any nominees, holdings companies, trusts and other entities to establish the ultimate individual(s) who have an ownership interest in a company.
Succumbing to the significant pressure would most likely have had a significant negative impact on the BVI’s financial services industry, however the amendments announced represent a sensible and well thought out solution which protect the BVI’s sterling reputation while at the same time fully addressing the fundamental concerns behind the pressure from the UK and international agencies. So we have the best of both worlds, persons seeking to conduct legitimate businessin the BVI maintain their rights to privacy and confidentiality but at the same time a system is now in place which allows the BVI Regulators and other international enforcement agencies to obtain information on beneficial owners in a timely manner when required.
The Existing Regime
The existing Eligible Introducer regime has been in place for many years and basically provides that a BVI Registered Agent if dealing with a licensed Corporate Service Provider in an overseas jurisdiction that has rules and regulations equivalent to those of the BVI could incorporate and provide services without having to obtain and maintain all of the required due diligence information in the BVI. This is on the understanding enshrined in a proper agreement that the overseas provider has already obtained and is maintaining the information in its files and will supply on a timely basis to the BVI registered agent on demand.
What are the Changes?
The proposed changes are set to take effect on 1 January 2016 and provide that the Eligible Introducer system still remains largely intact; however the information listed below must be provided to the BVI Registered Agent who must maintain this information on file in the BVI for all new incorporations.
The information required will include:
- Beneficial Owner’s Name
- Date of Birth
- Residential Address
The changes also apply to existing BVI companies but the BVI registered agents will have a transition period of 12 months from the implementation date concluding on 31 December 2016 within which to obtain this information.
Full details have not yet been made available however as per the existing requirements it is believed that the above information will only be required for beneficial owners with a 10% or greater interest in the entity. It is anticipated that the actual due diligence will still be maintained overseas by the Eligible Introducer once the above mandatory information is provided to the BVI Registered Agent.
The Register of Directors
Another key change, which will take place in 2016 and which comes as part of BVI’s implementation of the most recent FATF Recommendations is the introduction of a system for the mandatory filing of the Register of Directors of a company at the Registry of Corporate Affairs. However it is key to note that the filed registers will not be accessible by the general public as there will be restricted rights of access to the system.
If you have any queries or require further information on all these amendments, please do not hesitate to contact DILIGENT COMPANY SERVICES – CCP FINANCIAL CONSULTANTS LIMITED.