Changes to the BVI’s Non-Belonger Land Holding Licence policy announced

The policy changes, approved by Cabinet, will come into effect from 18 December 2023 (the Effective Date), subject to any legislative amendments or ‘market conditions’. Important excerpts provided by the MENRCC dated 22 November 2023, outlining the key changes and principles for Non-Belongers, are set out below:

• Increased development timeframes: The timeframe to complete a development subject to a NBLHL has been increased from three years to five years, with the option remaining, to extend by a further two years upon request and payment of the relevant application fee. Once this seven year period (the Development Period) has expired, no further extension will be granted, unless  the applicant can provide satisfactory reason(s) for non-development during the Development Period to the Governor.
• Confirmation of forfeiture: The Governor may engage in forfeiture proceedings at the end of the Development Period if no development of land has commenced. This may involve forfeiting the land to the Crown, or disposal via the usual sale of property procedures.
• Rules on rentals:  Non-Belongers may rent their property (ie no restrictions on licence by the MENRRC), providedthey obtain a Trade Licence and make arrangements with the Inland Revenue for payment of accommodation taxes. Rental fees will attach to these rentals at a rate of $2.00 per square feet of covered development and $.50 per square feet of uncovered development. More information on fees and penalties can be found in our legal guide.
• Clarification on penalties: Non-Belongers who breach the conditions of a NBLHL will be subject to a penalty, including where development differs to plans approved by The Planning Authority. Twelve categories of penalties have been established together with the associated monetary penalties for each category. These penalty categories are set out below. Property owners should familiarise themselves with these new categories of penalties in order to have proper management of expectations once an application for a NBLHL is made.
• Property advertising and registration: As is the case at present, all properties for sale must be advertised in a local newspaper and online for four consecutive weeks. Further, the Non-Belonger must register the land or property on the MENRCC’s website for the same period.
• Failure to comply with mortgage: Where a lending institution is selling the property due to the licensee's failure to service a mortgage, the licence holder will be required to pay a penalty.
• Amendment fees: Separate to the fees for an extension of time, application fees will be payable on all other amendments to NBLHLs.
• Minimum capital investment: A minimum capital investment on undeveloped land of US$350,000 is required. The Town and County Planning Department will require a Non-Belonger to adjust to meet this amount. A penalty will be due where the requirement is not met.

Alongside the policy excerpts and the new schedule of the NBLHL fees and penalties that will be charged, a new outline of the application process and supporting documents required for future NBLHL applications has also been provided.

Further details can be found in our Legal Guide available on request.

If you need assistance with your NBLHL application or require further clarification on the above principles, please feel free to contact Ayana Hull, Head of BVI Private Wealth , or your usual Harneys contact for further assistance.