Background
Requirements
Local factors
Flexible remedy


Background

The BVI Company Registry is the only major source of publicly available information and records, other than by recourse to litigation. However, a search of the public register is likely to reveal only the following:

  • the certificate of incorporation;
  • the memorandum and articles of association;
  • the identity of the registered agent and the location of its registered office; and
  • possibly, details of directors.

A search will not normally reveal the names of the shareholders or details of assets.

Although confidentiality in BVI companies is still paramount, in limited circumstances court actions under the principle set out in Norwich Pharmacal v Customs and Excise Commissioners ([1974] AC 133 (House of Lords)) can be successfully brought before an action against third parties to identify, for example, the shareholders of BVI companies. Given the British Vigrin Islands' success in incorporating business companies (over 800,000 at present), this is usually in the form of an application against trust companies and registered agents where the wrongdoer is a company.

Requirements

A Norwich Pharmacal disclosure and production order is available to obtain documents from third parties that have become mixed up in wrongdoing through no fault of their own.

Under traditional Norwich Pharmacal principles, the court will normally require the following:

  • A wrong must have been carried out, or arguably carried out, by an ultimate wrongdoer.
  • There must be a need for an order to enable an action to be brought against the ultimate wrongdoer.
  • The party against which the order is sought must:
    • be mixed up in so as to have facilitated the wrongdoing; and
    • be able to likely to be able to provide the information necessary for the wrongdoer to be sued.

Local factors

The following factors apply in the British Virgin Islands:

  • The 'innocent' third party is often the registered agent or the banker of the company which has been passively involved, rather than having actively facilitated the fraudster's wrongdoing.
  • A registered agent will typically hold additional useful company formation documents, including the share register, the register of directors and the minutes of any shareholders' or directors' meetings.
  • The registered agent may have some correspondence showing the source of instructions, which can be extremely valuable.
  • Increasingly, metadata unwittingly held by the registered agent is becoming a fruitful source of information.

Flexible remedy

Although rare, the BVI courts have demonstrated their willingness to recognise Norwich Pharmacal relief as a flexible and adaptable remedy. Recent cases have led to relief in areas as diverse as the following:

  • matrimonial litigation, where a husband in foreign matrimonial proceedings was seeking to conceal marital assets;
  • against registered agents where the companies were alleged to have been the recipients of funds fraudulently advanced by the applicant's former owner; and
  • to obtain information on trustees and beneficiaries of trusts.

For further information on this topic please contact Ian Mann at Harney Westwood & Riegels by telephone (+852 3195 7200), fax (+852 3195 7210) or email (ian.mann@harneys.com).

This article was first published by the International Law Office, a premium online legal update service for major companies and law firms worldwide. Register for a free subscription.