ESSENTIAL FACTS
HISTORY
HISTORY
The Dutch settled the British Virgin Islands in 1648, only to be annexed by the English in 1672. They eventually won their independence from the UK in 1967.
POLITICAL SYSTEM
The Queen of England appoints and is represented by the British Virgin Islands’ Governor. The Premier is elected, and then nominates his or her Deputy Premier and cabinet. The legislative branch consists of only of a House of Assembly.
JUDICIAL SYSTEM
The British Virgin Islands have an extensive judicial branch, made up of the Eastern Caribbean Supreme Court, consisting of the High Court of Justice and the Court of Appeal; Magistrate’s Court; Juvenile Court; and the Court of Summary Jurisdiction.
COMMERCE
COMMERCIAL ACTIVITY
Agriculture: Fruits, vegetables; livestock, poultry; fish
Industry: Tourism, light industry, construction, rum, concrete block, offshore financial center
TRADE PRACTICES
Exports: Rum, fresh fish, fruits, animals; gravel, sand to the US Virgin Islands and Puerto Rico
Imports: Building materials, automobiles, foodstuffs, machinery from the US Virgin Islands and Puerto Rico
FINANCE
FINANCIAL FACTS
Although tourism is a main economic source, the fees generated from the incorporation of offshore business have now become a major source of revenue for the BVI economy. With the improved confidentiality clauses put into place almost 15 years ago, BVI is now seeing almost half a million companies incorporated each year.
Fiscal year: 1 April – 31 March
BANKING
The British Virgin Islands are extremely vigilant in the fight against money laundering; to this end, there are only a small number of international banks available to offshore banking customers.
Banks can receive licenses as follows:
- General Banking License. No limit to banking activity; minimum capital must be USD$2 million; annual fee USD$20,000.
- Class 1 Restricted Banking License. Exclusively international business; minimum capital USD$1 million; annual fee USD$16,000.
- Class 2 Restricted Banking License. Business only with counterparties named in the license; minimum capital USD$1 million; annual fee USD$16,000.
MEMBERSHIPS
Caricom (associate), CDB, Interpol (subbureau), IOC, OECS, UNESCO (associate), UPU
FOREIGN INVESTMENT
BVI encourages foreign investment in many industries, including food processing, tourist-oriented manufacturing, film production, beverage production, yachting services and e-commerce.
Tax holidays of up to 20 years are available to foreign investors under a variety of circumstances, if the BVI government deems the purpose of the investment to be of special value to the economy, infrastructure, employment or other factors.
REAL ESTATE
The application for an Alien Landholding License, bestowed on foreigners wishing to purchase real estate in BVI, must include at least two financial references, one bank reference, two character references, and police record or statement from law authorities. There are fees for the application process, which vary depending on whether the application is on behalf of an individual or corporation.
IMMIGRATION
IMMIGRATION FACTS
Canadian and US citizens need to present a birth certificate, certificate of citizenship or voter registration card upon entering BVI, but will need to show a passport upon returning home. All other foreigners – including British citizens – must present a passport.
VISAS
Six-month visas are available for those showing a return ticket and enough funds to support one’s self during their stay.
EMPLOYMENT
BVI citizens have first priority for all employment opportunities. Only foreigners who have not yet obtained residency must apply for a work permit.
RESIDENCE
Only 25 people per year are granted residency status in BVI, and must agree to physically stay in BVI for at least 265 days out of every calendar year.
BUSINESS
BUSINESS ENTITIES
All companies wishing to incorporate as an IBC in BVI must submit a Register of Directors within 30 days of incorporation, and update as needed with the proper BVI authorities.
Other incorporation facts for IBCs:
- Minimum of one director and one shareholder
- None of the board, shareholders or company officers need to be BVI citizens
- No minimum capital
- Registered and bearer shares are accepted
- Audit is necessary only in the case of the IBC choosing to not keep company books
- Board and shareholder meetings can be held anywhere worldwide, or via conference call
- The Memorandum and Articles of Association are available to the public; all else remains confidential
- Exemption from BVI taxes
TRUSTS
BVI trust laws are based on English trust laws. The duration is 100 years. Purpose trusts are allowed. BVI trusts do not have to register with the government, file any returns or present any annual reporting. Any trust that operates exclusively outside of BVI is tax exempt. Trust duties are USD$50.
TAXATION
Those who are residents of BVI pay income, property and housing taxes; there are no capital gains, inheritance, gift, sales tax or VAT taxes.
CORPORATE TAXATION
The British Virgin Islands are subject to the EU’s Savings Tax Directive, thereby subjecting EU nationals to a withholding tax on their returns; corporate entities are exempt.
OTHER TAXATION/DUTIES
Customs Duties on imports can reach 20 percent, but capital goods imported that are shown to be of particular value to BVI infrastructure or economy are exempt from Customs Duties.
There is currently no sales tax in BVI; but the possible inclusion into the Caribbean Single Market, with its cutting of some significant sources of revenue for BVI, might force the start of a sales tax in the coming years.