British Virgin Islands Fund
The British Virgin Islands is the second largest offshore jurisdiction for hedge fund formation. With the passing of the Securities and Investment Business Act in 2010 (SIBA), the British Virgin Islands offers a solid legal platform for fund formation, sitting at the forefront of international expectations for effective regulation of funds and entities carrying on investment business. With an English-based legal system and the benefit of a fast track court for commercial disputes, the British Virgin Islands is considered a natural jurisdiction for fund formation at low cost.
Open-ended funds can be created as either companies, partnerships or unit trusts and are required to be recognised or registered by the British Virgin Islands Financial Services Commission as Private Funds, Professional Funds or Public Funds. Closed-end funds are exempt for registration with SIBA.
Setting up a hedge fund in the British Virgin Islands offers:
- Speed and ease of creating British Virgin Islands entities
- Relatively low cost, particularly in the context of government fees
- Flexible and practical business statutes
- British Virgin Islands insolvency law is simple and effective
- Strong and reputable compliance culture
- English-based legal system, established judiciary and absence of political or sovereign concerns
- Professional infrastructure and reputation. The British Virgin Islands is well known for its established and experienced financial services sector and substantial capacity
- Compliance with international anti-money laundering, anti-terrorist financing and other financial regulatory standards
- Significant number of international tax information exchange agreements and OECD ‘white list’ status
- Tax neutral
- Service providers to the fund (investment managers, advisers, brokers, administrator, auditors etc.) may usually be located anywhere in the world
- No local audit or sign off requirement
- FSC Mutual Fund Application Fee
- FSC Mutual Fund Recognition Fee ($500 after July in any year)
- BVI Company Licence Fee
- Authorised BVI Mutual Fund Agent Fee (upon appointment and annually thereafter)
- Registered Agent/Office (upon incorporation and annually thereafter)
- Communication/Courier/Company Seal costs
- name check
- preparation of the company memorandum of association
- preparation of the company articles of association
- preparation of company registration forms
- filing with the BVI registrar of companies
- certificate of incorporation
- share certificates
- minutes of the first board meetings
- register of directors
- register of members
- company seal
- re-draft, filing and certifying memorandum & articles of association for the fund formation
- preparation of offering documents and fund agreements
- preparation of investment fund application for recognition and licensing with BVI FSC
- filing the fund application with the BVI FSC
- certifying documents for the FSC
- payment of first year BVI Registered Agent/Office (annual)
- payment of first year Authorised BVI Mutual Fund Agent Fee (annual)
- payment of first year BVI Business Company Licence Fee (annual)
- payment of first year FSC Mutual Fund Recognition Fee (annual)
- courier service (1 time)
- Authorised BVI Mutual Fund Agent Fee
- Registered Agent/Office for a mutual fund
- BVI Business Company Licence Fee
- FSC Mutual Fund Recognition Fee
- Obtain CUSIP/ISIN number
- Nominated director (annual)
- Preparation of resolutions
- Prepare power of attorney
- Apostille
- Certificate of Incumbency
- Independent BVI legal review of investment fund offering memorandum