The BVI Business Companies Act, 2004 (the “Act”) permits a company incorporated in a foreign jurisdiction to continue as a company in the British Virgin Islands provided the Registrar of Corporate Affairs (the “Registrar”) is satisfied that certain criteria (as set out in the Act) have been met.
A foreign company may not continue as a company incorporated under the Act if:
- it is in liquidation, or subject to equivalent insolvency proceedings in another jurisdiction;
- a receiver or manager has been appointed in relation to any of its assets;
- it has entered into an arrangement with its creditors that have not been concluded; or
- an application made to a Court in another jurisdiction for the liquidation of the company to be subject to equivalent insolvency proceedings has not been determined.
An application to the Registrar by a foreign company to continue under the Act must be accompanied by the following documents:
- A certified true copy of the company’s certificate of incorporation, or such other document as evidences its incorporation, registration or formation.
- A memorandum and articles of association which complies with the provisions of the Act. The memorandum of association must state:
- the name of the company on the date of the application and the name under which it proposes to continue;
- the jurisdiction under which it was originally incorporated, registered or formed; and
- the date on which it was originally incorporated registered or formed.
- Evidence that the continuation has been authorised by such persons who are charged with exercising the powers of the company. This requirement may be satisfied by the Registered Agent supplying the Registrar with a certified extract of the resolutions by which the continuation was approved and authorised; and
- Evidence that the company is not disqualified from continuing to the British Virgin Islands. The Registrar will accept a legal opinion from an attorney practicing in the jurisdiction from which the company is continuing, confirming that it is not disqualified from continuing to the BVI. If foreign counsel is unable to confirm the company has not entered into any arrangement with its creditors, this confirmation may be done by way of affidavit from a director of the company confirming the same.
It should be noted that the BVI FSC has issued formal guidelines regarding the required format of the legal opinion and affidavit detailed above. Specific legal advice should be sought in this regard.
The Company will need to provide the following documents in order to continue from the foreign jurisdiction into the British Virgin Islands.
- memorandum and articles of association compliant with the Act;
- certified copy of its certificate of incorporation;
- a legal opinion confirming that the company is not disqualified from continuing under the Act (and possibly the affidavit as set out above); and
- resolution of the directors and/or members approving the continuation of the company to the British Virgin Islands and the adoption of the new memorandum and articles of association.
FILING OF DOCUMENTS WITH THE REGISTRAR
Upon filing the documents at the Registry and provided the Registrar is satisfied that all the requirements of the Act have been met, the continuation application will be approved.
The date of the continuation will be the date on which all the documents are submitted to the Registrar and from this date the company will be entered onto the BVI Register of Companies and a certificate of continuation will be issued.
EFFECT OF CONTINUATION
The continuation of a foreign company under the Act does not affect:
- the continuity of the company as a legal entity; or
- the assets, rights, obligations or liabilities of the company.
Without limiting the above:
- no conviction, judgment, ruling, order, claim, debt, liability or obligation due or to become due, and no cause existing, against the company or against any member, director, officer or agent thereof, is released or impaired by its continuation as a company under the Act; and
- no proceedings, whether civil or criminal, pending at the time of the issue by the Registrar of a certificate of continuation by or against the company, or against any member, director, officer or agent thereof, are abated or discontinued by its continuation as a company under the Act, but the proceedings may be enforced, prosecuted, settled or compromised by or against the company or against the member, director, officer or agent thereof, as the case may be.
All shares in the company that were outstanding prior to the issue by the Registrar of a certificate of continuation shall be deemed to have been issued in conformity with the Act and therefore remain unaffected by the continuation.
Once the company is continued under the Act:
- the Act applies to the company as if it had been originally incorporated or formed under it;the company is capable of exercising all the powers of a company incorporated under the Act;
- the company is no longer to be treated as a company incorporated under the laws of a jurisdiction outside the British Virgin Islands; and
- the memorandum and articles filed as below become the constitutional documents of the company.