NEW RECORD-KEEPING REQUIREMENTS FOR BVI BUSINESS COMPANIES This is to let you know that the record-keeping requirements for business companies incorporated in the British Virgin Islands (the "BVI") have been revised following an amendment to the Mutual Legal Assistance (Tax Matters) Act, 2003. Even though Section 98 of the Business Companies Act of the BVI, enacted almost ten years ago, had introduced a legal requirement for all business companies to keep records that are sufficient to show and explain the company’s transactions and that would enable the financial position of the company to be determined with reasonable accuracy and it had even established a US$10,000 fine for non-compliance; the amendments above referred have now specified where and for how long these records must be kept. The additional/specific requirements can be summarized as follows: 1. Any business company is now required to maintain “records and underlying documentation” either at its registered office in the BVI or at any other location in the BVI or elsewhere as the directors may determine (one possibility is to have this records at our offices, but this is of course not mandatory). Such records should be kept from the date the legislation was enacted on 26 November 2012.The records and any underlying documentation must be “in such form as (a) are sufficient to show and explain the company’s transactions; and (b) will, at any time, enable the financial position of the company to be determined with reasonable accuracy”. No further guidance is given in the amendments as to what is meant by records and underlying documentation other than a statement that it includes a company’s accounts. 2. A business company must retain the records and underlying documentation for a period of at least five years from “the date (i) of completion of the transaction to which the records and underlying documentation relate; or (ii) the company terminates the business relationship to which the records and underlying documentation relate. 3. If a business company chooses to keep its records and underlying documentation other than at its registered office in the BVI it is required to provide its registered agent with a written record of the physical address of the place or places at which the records and underlying documentation are kept. We can of course provide you with a form for your execution. It is very important that all BVI companies comply with these new requirements, which have already been brought into force.
Posted on: Mon, 22 Jul 2013 18:37:09 +0000
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