The Act allows for the adoption of appropriate rules and regulations with respect to the obligations imposed by the Act in order to further clarify the substantive requirements prescribed by the Act and to provide guidance for the interpretation of its terms. These guidelines have been published in the form of the “Virgin Islands Economic Substance Rules”. The original version of the final rules can be found here. The Act is the Economic Substance (Limited Partnerships and Partnerships) Act, 2018 (the “SE Act”). The Code of Economic Substances (Guide) accompanies the Seeurs Act. He clarified some adjustments made by the Code of Conduct Group and clarified further details on the reporting requirement and the submission period under the BVI-ESA. The Act makes certain amendments to the Secure Beneficial Ownership Search System Act 2017 (the BOSS Act), which came into force on 30 June 2018. Currently, the BOSS Act requires that beneficial ownership information of companies registered in the British Virgin Islands be shared with the registered representatives of these companies and stored in a secure search system. Companies deemed non-compliant or carrying out intellectual property activities may be the subject of a spontaneous exchange of information about the company in the BOSS Act RA database with certain competent authorities abroad, even if a beneficial owner, a direct parent company or a superior parent company of the company is located. Disclaimer: Although BBCIncorp strives to make the information on this website as up-to-date and accurate as possible, the information itself is for reference purposes only.

You should not replace the information in this article with competent legal advice. Feel free to contact BBCIncorp customer service for advice on your specific cases. Which companies are subject to the SE Act? Any company (registered in the British Virgin Islands or a foreign company registered under Part XI of the British Virgin Islands Commercial Companies Act 2004) or limited partnership (incorporated in the British Virgin Islands or a foreign limited partnership registered under Part VI of the Limited Partnerships Act 2017) that is a tax resident of the British Virgin Islands and practises one of the following “relevant activities” as a corporation (i.e., Profit-making and regular): The definitions of each relevant activity are included in the SE Act. (ii) appropriate expenditure is incurred in the Virgin Islands; -The total operating expenses for and by the activity in question in the British Virgin Islands; – have sufficient qualified staff to carry out the activity in question in the British Virgin Islands; Note that proof must be provided within the registration deadline. The foreign company must also specify a deadline for providing all the necessary evidence. The extension limit may not exceed 2 fiscal years, including the first fiscal year in which provisional salary was requested. 1. What is a resident partnership or limited partnership? The Economic Substance (Limited Partnerships and Partnerships) Act, 2018 (the Act) came into force on August 1, 2018. January 2019 (with some retroactive revisions made shortly thereafter) and applies to all companies and limited partnerships registered in the British Virgin Islands (or foreign companies and limited partnerships operating in the Territory), with the exception of companies registered in the British Virgin Islands or limited partnerships that are “non-resident” in the British Virgin Islands.

The law applies to existing and new companies founded or established on or after 1 January 2019. If the legal entity is not able to provide the above evidence, there are other ways to provide proof of foreign tax residency: note that depending on the type of business unit and the category of business, the requirements may also vary. – have an adequate physical presence to carry out its essential income-generating activities; All limited partnerships in the British Virgin Islands without legal personality must submit an ES annual report within 18 months of the beginning of the financial year. (a) the activity in question which it carries out is directed and managed in the Virgin Islands; The importance of basic income-generating activities varies by industry and sector, but generally includes the following: economic substance is the focus of any offshore jurisdiction, including the British Virgin Islands, “not or only nominal taxes”.