BVI Business Companies Act Workshop Kenneth Baker Deputy Managing Director, Regulation

How to Become a Company Manager / Registered Agent Relevant Legislation Definition Application Minimum Requirements Fit & Proper Assessment Application Checklist Post Licensing Approvals Anti-Money Laundering & Compliance Failure to Comply with Legislation Contact Details

Relevant Legislation Company Management Act, 1990 Financial Services Commission Act, 2001 Anti-Money Laundering Code of Practice, 1999

Definition of Company Management Business Formation of Virgin Islands companies & [continuation of companies] Provision of Registered Agent Services Provision of Registered Office Services [Provision of Director or Officers for companies] [Provision of Nominee Shareholders of companies]

Application for Licence Issue of a licence is discretionary and not an entitlement Decision to refuse to grant a licence is not subject to appeal

Minimum Requirements Applicant satisfies requirements - Company Management Act Applicant “Fit & Proper” – competence & capability conduct company management business Organization & management of applicant adequate for carrying on company management business Minimum capital resources US$25,000 Application fee US$200

Company Management Capital Resource Requirements Minimum cash in hand or on deposit of US$25,000; or Minimum cash in hand or on deposit of US$10,000 and security or interest for US$15,000 Irrevocable letter of credit or security guarantee from BVI bank Interest in real property located in the BVI

Fit and Proper Test Honesty, integrity and reputation Competence and capability Financial soundness [Track record & viability] Prior to issuing a licence or certificate, LSC must be satisfied that the action is in the interest of the BVI and that the entities meet relevant “fit and proper” tests established by BVI laws and policies, or by the appropriate international standards-setting organisation. Before granting an application for approval of a licence, the FSC must be satisfied that the senior managers, directors and shareholders are fit and proper. licensees are also required to notify the FSC of any significant matter which might affect the assessment of fitness and propriety as soon as the firm becomes aware of it. Furthermore, the conditions for fitness and propriety must be met on a continuing basis. All changes in control are subject to regulatory approval. The FSC takes three key factors into account when assessing fitness and propriety: a) Honesty, integrity and reputation. No individual can be approved unless the FSC is satisfied that he intends to be open and honest in his dealings with consumers, professional market participants and with regulators, and that he is able and willing to comply with the requirements imposed on him and his firm; b) Competence and capability. The FSC expects the individual to have the necessary skills to carry out the function which he is performing or will be performing; and c) Financial soundness. If an individual is in financial difficulty, he may be tempted to put his interests above those of his customers to boost his own earnings.

Application Checklist - 1 Name of company applicant Address Principal office Registered office Name and Address of Shareholders (must be BVI Nationals) Name & Address of 2 Directors Name and Address of Officers and Managers

Application Checklist - 2 Name and Address of Solicitors Letter confirming that they are acting on behalf of applicant Name and Address of Auditors Evidence of incorporation

Application Checklist - 3 Evidence of [relevant experience] competence & capability [Paid-up capital] – Company Management Capital Resource Requirements of US$25,000 2 Character references plus bank statement Police record [Annual Accounts for the preceding 3 years]

Application Checklist - 4 Business Plan Business objectives Management structure & operations Business development Financial projections Operating policies & procedures

Duration of Licence Licence valid until surrendered, suspended or revoked Licence fee US$500 plus US$10 for each company under management due annually during January Licence prominently displayed on the premises from where the business is conducted List of licence holder on Commission’s website, Financial Directory www.bvifsc.vg

Post-Licensing Approvals Change in shareholders Changes in company name Changes in business address Changes in Directors & Senior Officers Changes in auditors Change in corporate structure Changes in business strategies

Anti-Money Laundering Safeguards Commission has a vested interest in the prevention of Money Laundering Our mandate requires that we monitor the entities that we register and licence, for compliance with the applicable anti-money laundering legislation All Commission staff members and staff members of licensees are obligated to report any suspicious transactions to the Financial Investigation Agency (“FIA”). Failure to report a suspicious transaction is an offence punishable by a fine and jail sentence

Compliance Issues As regulator, Commission’s duty to monitor its licensees for: Compliance with the regulatory legislation and the applicable regulations, code of fiduciary conduct, international standards and rules imposed by the Regulator (“Regulatory Compliance”) Compliance with the licensed institutions’ own set of internal rules (“Internal Compliance”)

Regulatory Compliance The on site inspection involves visiting the premises of the licensee and reviewing their operations and internal control Commission also works with individual licensees and associations in developing and enhancing anti-money laundering procedures through the development of guidance notes.

Failure to Comply with Legislation Commission entitled to take Enforcement Action Administrative Penalty Revoke appointment of Directors Appoint an Examiner Appoint a Qualified Person Issue a Directive Suspend or Revoke Licence

Contact Details For Additional Information: Kenneth Baker Director, Banking & Fiduciary Services Financial Services Commission Pasea Estate Tel: 494 1324