Recently, we discussed how the Cayman Islands is a great place to open an offshore company (see here https://en.cancangroup.com/how-to-open-a-company-in-the-cayman-islands%ef%bf%bc/ for the article). Aside from that territory, the British Virgin Islands (BVI) is also a beneficial place to open an offshore company.
According to TMF’s Global Business Complexity Index (GBCI), in 2021 the BVI was the sixth least complex jurisdiction among 77 jurisdictions to open an offshore company in. The mandatory involvement of an agent to register with the authorities makes the BVI a slightly more complicated place to operate in, compared to the Cayman Islands.
However, the BVI’s popularity in being one of the first choices for incorporation has not decreased. There were a total of 36,178 new companies opened in the BVI last year (BVI Company Search).
Why the British Virgin Islands?
- Tax-neutral jurisdiction: There is no corporate income tax or capital gains in the BVI. It is also tax-free to transact stamp duty, like the transfer of assets, shares, or other securities.
- No director residency requirements: Many countries around the world require at least one director of the company to be a local resident or require the majority of members of the Board of Directors to be local residents. There are no such residency requirements for the director of the company in the BVI, so the company does not have to appoint a nominee director.
- Limited maintenance: Every BVI company is required to maintain an accounting record of each transaction for at least five years. However, an annual statutory report in financial statements is not required to be filed, nor is an audit required.
- Confidentiality: While it is mandatory to register the directors to the Registrar, the file will not be public, providing privacy to investors.
- Speedy incorporation: When all correct information and forms are submitted, the time to obtain the Certification of Incorporation could be as short as two working days.
- No minimum capital requirement: There is no requirement for any monetary investment at the time of incorporation. Additionally, there isn’t a minimum share equity investment required for the company’s capital – the company can issue shares with or without par value.
What Do You Need for Incorporation?
- Memorandum and Articles of Association
- Certified individual shareholders’ and Directors’ address proof and passport
- Certified corporate shareholders’ certificate of Incorporation, register of directors, and register of shareholders
- A reserved company name: words like “Bank,” “Trust,” “Insurance,” or “Fund” cannot be used unless there is a license or prior written consent from the Financial Services Commission
- A registered agent who is located in the BVI
- A registered office maintained by the company’s staff and the registered agent
- A corporate bank account: We have more details about the bank account opening below
After the application, the next steps are obtaining the Certification of Incorporation, preparing and signing the activation document of the new company, and preparing the whole set of the company kit.
Want to incorporate in the British Virgin Islands? CanCan can help. We are experienced in incorporating any type of company while being in compliance with the BVI regulations. Contact us here: https://en.cancangroup.com/about-us/#contact
A bank account is also crucial for incorporation. As the BVI is not a financial hub like Hong Kong or Singapore, the local banks do not really tailor their services to international businesses or require a face-to-face meeting at the bank to open an account. As of December 2021, there are only eight banks in the BVI (flatbkny). A corporate bank account is allowed to be opened from another jurisdiction, making it a better option for people who open an offshore company in the BVI, as they are likely to be located outside of the BVI.
The documents you generally need to open a bank account:
- Bank account application form
- Certificate of Incorporation
- Memorandum and Articles of Association
- The company’s good standing status certification
- Business plan
Want to open a bank account for your BVI offshore company? CanCan can help. We are experienced in opening bank accounts for offshore companies. Contact us here: https://en.cancangroup.com/about-us/#contact
About CanCan
CanCan has been providing business and compliance consulting to international businesses in China for 25 years. We are professionals from China, Hong Kong, and the US with international accounting and legal firms practicing experience. We provide quality service, and we understand the importance of the practicalities in incorporations. Aside from incorporation, we also offer a wide range of consulting services including acting CFO, financial due diligence, compliance advisory, and mergers & acquisition consulting. You can find more information here: https://cancangroup.com/
