BVI further amends trust company law and regulation

The BVI has recently amended the Banks and Trust Companies Act 1990 (theBTCA) and the Company Management Act 1990 (theCMA). The amendments seeks to further modernise the BTCA and CMA regimes by taking into account new developments and providing new licence classes of trust and corporate service providers relevant to family and other closely held groups.

New BVI regulated products (BTCA)

Amendments to the BTCA gazetted on 3 August 2018 and in force as of 1 October 2018 create two additional classes of licences, namely a Class IV trust licence and a Class V licence:

• The Class IV trust licence allows the holder to carry on trust business and company management business by family offices and other closely held groups.
• The Class V licence allows the holder to carry on company management business only by family and other closely held groups.

There is an indication that the nature and scope of family business and other closely held group business will be outlined in the Regulatory Code 2009 (the Code). However, at the time of writing, there has been no update to the Code.

Where the BVI Financial Services Commission (BVIFSC) issues a Class IV trust licence, the licensee would be restricted to administering no more than 500 British Virgin Islands (BVI) companies and 50 trusts, have a physical presence in the BVI and may not engage in introduced or third party business.

Where the BVIFSC issues a Class V licence, the licensee would be restricted to administering no more than 300 BVI companies, have a physical presence in the BVI, not engage in any trust business and not engage in introduced or third party business.

Streamlining functionality (BTCA and CMA)

Authorised agents

Amendments to the BTCA and the CMA also redefine the functions of an authorised agent to include the acceptance, on behalf of a licensee, the service of documents, whether arising from a legal process or otherwise.

Under the BTCA and CMA each licensee must appoint at least two (2) BVI-resident natural persons to act as authorised agents. Historically, these agents have had a limited role and the recent amendments look to better define the precise functions to be undertaken by them.

Scope of registered agent services

The amendments to the BTCA and the CMA creates a new provision to expand on the nature and scope of registered agent services and to empower the BVIFSC to restrict a registered agent or class of registered agents from performing the function of registered agent in relation to a BVI business company or a corporation incorporated under an enactment, a foreign company or a limited partnership. This is designed to ensure that persons performing registered agent services have the necessary resources and a good compliance record to be able to execute and provide the registered agent services effectively.

Registered office services

In addition, any person who provides registered office services, or generally carries on company management business pursuant to the CMA would effectively be performing registered agent services. The BVIFSC is also now empowered under the BTCA and the CMA to be allowed to make an order against a registered agent and to have that order published on the BVIFSC’s website to restrict the registered agent or any class of registered agents from acting as a registered agent of any entity, unless the person or class of persons meets such conditions as may be specified by the BVIFSC in the Code.