British Virgin Islands Business News

The analysis of the latest events in BVI and worldwide, affecting BVI business environment; facts and statistics on BVI International Business Companies involved in global business activities.

Monday, September 16, 2019

BVI and Seychelles Sign Multilateral Competent Authorities Agreement

According to the new update by OECD, the British Virgin Islands and Seychelles have signed up to the Multilateral Competent Authorities Agreement (MCAA) on country-by-country reporting. The BVI signed up to the pact on July 7, 2019, and Seychelles joined the agreement two days later. 

Country-by-country (CbC) reporting is a standard which requires the disclosure by large multinational groups of some basic items of financial data, usually in each country where the parent is located. Collected information includes the amount of revenue reported, profit before income tax, and income tax paid and accrued, as well as the stated capital, accumulated earnings, number of employees, and tangible assets. The OECD developed the Multilateral Competent Authority Agreement on the Exchange of CbC Reports, enabling their automatic exchange.

According to the OECD's update in the end of August 2019, a total of 82 territories have now signed up to automatically exchange CbC reports.

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Friday, September 06, 2019

BVI Premier Responded to Letter by Director of UK OTs

BVI Premier Andrew Fahie has denied claims by Ben Merrick, the Director of British Overseas Territories, that his government caused deterioration of engagements between the UK and the BVI territory.

The UK official representative expressed his disappointment about the administration of Fahie’s government after cancellation of some important meetings, including that with UK minister responsible for Overseas Territories, Lord Tariq Ahmad. In response to the letter which was addressed to the Premier and became public, the Premier confirmed that he and his government have consistently been in contact with the United Kingdom. Fahie also said he believes Merrick’s letter of ‘untrue accusations’ had a purpose to damage his reputation as Premier.

The Premier further said that he and local delegation had met with Lord Ahmad in the Cayman Islands in June 2019, and discussed different areas that they’ve been working on. He noted that they had made it clear to the UK after being elected that the Fahie administration was a new government that needed to do research to ensure it was fully knowledgeable about the loan guarantee, and said that they needed some time to do that.

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Saturday, July 20, 2019

Harneys Offshore Law Firm Recognised as Leader in Private Wealth Market

BVI offshore law firm Harneys has become a leader in the private wealth market for the third consecutive year, being recently ranked in the 2019 Chambers High Net Worth (HNW) Guide. The British Virgin Islands team remained the sole firm recognised in the Band 1 ranking for offshore trusts, and the Cayman Islands team remained with its Band 2 ranking.

Partner Henry Mander, who is leading the trusts teams within the Private Wealth department, said in his comments: “Harneys has an outstanding reputation for its private wealth work in the BVI; our ranking and the quality of our client base is testament to our success.”

Harneys’ trusts practice offers advice to individual and commercial clients on the establishment, administration and structuring of all types of BVI, Cayman Islands and Cyprus trusts. The company provides wealth management solutions to a wide range of clients from different countries.

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Saturday, June 22, 2019

New Volume of Statistical Bulletin Published by the Commission

The BVI Financial Services Commission has issued the fifty-fourth volume of its Statistical Quarterly Bulletin, providing information about the financial services activities in the jurisdiction in the first quarter of 2019.

According to the Registry of Corporate Affairs, 7,214 new companies were incorporated in BVI in the first quarter of the year, which is 19.09% decrease compared to 8,916 in the fourth quarter of 2018 and 26.37% decrease compared to 9,798 in the first quarter of 2018. Total cumulative number of registered BCs as at 31 March 2019 was 408,838. Also, in the first quarter of 2019 there were 12 new Private Trust Companies, 1 Segregated Portfolio Company, 1 Foreign Company registered, along with 80 continuations. 

There were 56 new Limited Partnerships (LPs) formed in Q1 2019, which is a 80.65% increase when compared to 31 formed Q1 2018, and a 51.35% increase in the number of LPs formed in Q1 2019 when compared to 37 LPs formed in Q4 2018. Total cumulative number of active Limited Partnerships was 977 as at 31st March 2019.

In the first quarter of 2019, there were 57 new applications to register new Trade Mark, which is an increase by 21.28% when compared to Q1 2018, and a decrease by 1.72% when compared to Q4 2018. According to Banking, Insolvency and Fiduciary Services statistics, there were 6 new General Banking Licences and 1 Restricted Class 1 Banking Licence issued in the first quarter of 2019. The banking sector’s total asset size in this quarter at approximately US$2.43 billion is comparable to Q4 2018’s performance of US$2.37 billion. 

International Cooperation statistics records the number of incoming and outgoing requests for information, classified as formal or informal. In the first quarter of 2019, there were 15 formal and 5 informal incoming and no outgoing requests. Further information and statistics is available at the website of the Financial Services Commission.

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Saturday, June 08, 2019

New Media Release on Financial Services Business Issued by BVI Finance

BVI Finance has reported the considerable increase in the quantity and quality of business in the financial services sector of the territory in 2018. Besides the highest level of overall new incorporations in three years, there was an increase in the number of higher-end limited partnerships; BVI keeps its leading position in mergers and acquisitions, public listings, and innovative areas such as Initial Coin Offerings.

Chief Executive Officer of BVI Finance Elise Donovan stated in the media release: “More than 400,000 organisations recognise that our strong legal system, business-friendly laws and world-class corporate services sector means we are an indispensable hub for global trade… We are delighted to see that 2018 was a strong year for incorporations as more businesses and individuals chose to take advantage of the strategic and administrative benefits that our global financial centre offers. The noted increase in the quality business happening on-island is a reflection of the type of businesses and professionals making the BVI stronger.”

The release mentioned recent activity of the BVI-based law firms which added to the strength of territory’s financial sector: law firm Ogier provided a counsel on a US$350mln biopharmaceutical merger, Appleby acted as advisers on a private token sale, raising about US$1bln, and earlier in 2018 Harneys represented an Information Technology services provider on a US$2bln merger acquisition. The last transaction is a new BVI record for the largest takeover of a publicly-listed BVI company by transaction value.

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Friday, May 31, 2019

BVI Urged UK Government to Back Modern Partnership with OTs

At the recent meeting at the House of Commons with Andrew Rosindell, MP, chairman of the the Overseas Territories All Party Parliamentary Group in the UK government, the special representative of the British Virgin Islands urged to support the renewal of partnership with Overseas Territories including BVI.

Benito Wheatley welcomed the position of the UK government stated by the Foreign and Commonwealth Office not to force the OTs to adopt the UK decisions on the Territories in areas of governance “constitutionally devolved to them without their consent”. He added: “It is now time for the UK Parliament to support a renewal of the modern partnership between the UK and Overseas Territories based on the principle of self-governance and we hope there will be no further parliamentary moves to undermine the UK Government position that rejects the use of Orders in Council against the Territories.” 

Wheatley also praised Rosindell for his long-standing support to the Overseas Territories including BVI and for respecting their constitutions. It is known that the UK government is taking steps to mitigate possible adverse effects that Brexit, which is now planned on October 31, can have on the British Virgin Islands. Governor Augustus Jaspert stated that many of the benefits that the BVI currently receives from its association with the EU, including EU funding and trade benefits, would go unchanged when Brexit is finalised - among them.

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Friday, May 10, 2019

BVI FSC Issued Statistical Bulletin for Q4 2018

The British Virgin Islands Financial Services Commission has issued the fifty-third volume of its Quarterly Statistical Bulletin, providing analysis and information about financial services activities for the fourth quarter of 2018. According to the information published by the Registry of Corporate Affairs, which maintains the required registers of companies, there were 8,916 new incorporations of business companies in Q4 2018 (a 6.88% decrease when compared to 9,575 in Q3 2018 and 4.43% increase when compared to 8,538 in Q4 2017). Cumulative number of companies on the Register was 402,907 as at 31 December 2018.

In the fourth quarter of the year, there were 37 Limited Partnerships (LPs) newly formed in the BVI. There was a 37.04% increase in the number of new Limited Partnerships formed in Q4 2018 when compared to 27 in Q4 2017, and a 67.54% decrease in the number of LPs when compared to 114 in Q3 2018. Cumulative number of active LPs was 940 in the year 2018.

According to the information of the Intellectual Property Unit within the Registry of Corporate Affairs, which is responsible for administering all laws relating to intellectual property in the British Virgin Islands, in Q4 2018 there were 58 applications to register a trade mark - that is 61.11% increase when compared to 36 in Q4 2017, and 15.94% decrease compared to 69 in Q3 2018.

The figures of Banking, Insolvency and Fiduciary Services statistics recorded for all commercial banks show the decrease of cash items quarter over quarter and increase year over year. Loans and advances increased quarter over quarter and decreased year over year, while investments decreased quarter over quarter. The Net Interest Income for commercial banks decreased by 1.72% in Q4 2018 when compared to Q4 2017, and decreased by 23.68% in Q4 2018 when compared to Q3 2018.

Further information, including also Investment business and Insurance statistics, can be found on the BVI FSC homepage.

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Monday, April 29, 2019

2019 Budget Passed by the House of Assembly

On April 26, following two days of debates, the House of Assembly of the British Virgin Islands has passed the budget 2019 with amendments; legally titled the Appropriation Act 2019, it has retroactively come into force on January 1, 2019.

The largest share of the budget is reportedly given to the Ministry of Health & Social Development. The Ministry of Education, Culture, Youth Affairs, Fisheries & Agriculture is the one to receive the second largest share, followed by the Ministry of Transportation, Works & Utilities.

The fourth most significant share of the budget was received by the Ministry of Finance and Ministry of Natural Resources, and the fifth one was received by the Ministry of Labour & Immigration.

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Friday, April 05, 2019

BVI Government investing into BVI Health Services Authority

The new Premier and Minister of Finance Andrew Fahie made the announcement during the budget address in the House of Assembly that BVI Government will invest US$2,5mln into the BVI Health Services Authority. The main purpose of the investment is to boost medical tourism in the territory. The Premier also said: “This essential investment is critical to ensuring that the BVIHSA is able to collect sufficient revenue to meet all of its obligations.”

By words of BVI Premier, when medical tourism starts generating sufficient revenue, the government will no longer inject millions into the BVIHSA through the National Health Insurance (NHI) scheme. The NHI receives a yearly allocation of US$42 million from the BVI’s annual budget

This year, the Ministry of Health was allocated total amount of US$60,552,125, which makes 10.2% of this year’s US$426 million budget.

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Friday, March 29, 2019

CDB Issued Regional Report and Economic Forecast for 2018-2019

The Caribbean Development Bank (CDB) said in its regional assessment and economic outlook report that the Caribbean region has grown a substantive rate over the last year, primarily due to tourism growth and hurricane recovery. Financial position of the Caribbean countries mostly remained positive, with decline of the public debt in the region from 67% of GDP in 2017 to 63% in 2018. Debt-to-GDP ratios fell in 13 borrowing member countries, and debt is still over 60% in 11 territories.

The Caribbean development bank forecast economic growth for almost all its member countries, with an average rate of 2%, noting that growth depends also in international trends. The CDB projected that Grenada will have the fastest economic growth in 2019, along with Guyana, Suriname, and Trinidad and Tobago. It is expected that economic growth will continue in the British Virgin Islands, together with continued recovery from hurricanes of 2017. Business services, tourism, construction and agriculture will provide growth in most member countries.

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Monday, March 18, 2019

BVI Premier Initiates Forensic Audit of Finances

BVI Premier Andrew Fahie announced that a forensic audit on the finances of the government is expected to be done within the first 100 days of the VIP government, the completion date would be in June 2019. The audit which will be conducted by an unspecified firm is not exclusive to the finances of the territory, but has the purpose to reveal the “overall status” of the government of the British Virgin Islands.

In his speech at the House of Assembly on March 12 during the swearing ceremony, Premier Fahie said that the “comprehensive forensic audit… will allow us an accurate assessment of where we are so that we can better manage the expectations [of residents] and build a strong foundation on which to build upon as your new government.”

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Saturday, March 09, 2019

New Ministers Appointed by BVI Premier

During the ceremony to swear in the new government ministers, which was held in the Government House, the new BVI Premier Andrew Fahie announced extensive ministerial reshuffling. Mr. Fahie is minister of finance, the portfolio of minister of health and social development is given to Carvin Malone, Kye Rymer is the newly appointed minister of transportation, works and utilities, Vincent Wheatley is minister of education, culture, youth affairs, fisheries and agriculture, Sharie de Castro is junior minister of trade and economic development, and Shereen Flax-Charles is junior minister of tourism; Neville Smith will serve as deputy speaker in the House of Assembly, and will occasionally fill in as a junior minister or minister.

The BVI government announced that Dr. Wheatley was sworn in as deputy premier for a period of three months. During the first year, every three months Mr. Fahie will appoint different minister to this position to provide necessary experience to the leaders. According to the government press release, after the first year someone will take this post permanently. 

Reorganization also includes the responsibility for telecommunications, ports and airports taken by the Premier’s Office, and responsibility for immigration taken by the newly formed Ministry of Natural Resources, Labour and Immigration. Among other changes there is moving of the Department of Agriculture and the Conservation and Fisheries Department from the Ministry of Natural Resources and Labour to the newly renamed Ministry of Education, Culture, Youth affairs, Fisheries and Agriculture.

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Friday, March 01, 2019

General Elections Won by VIP, Andrew Fahie Sworn as New Premier

Andrew Fahie has become the new Premier of the British Virgin Islands, after the Virgin Islands Party (VIP) has won the majority 8 of the 13 seats at the 2019 General Elections. On Tuesday, BVI Governor Augustus Jaspert officially swore in the Virgin Islands Party (VIP) leader as the Premier; now he is to appoint five elective representatives as government ministers.

The Virgin Islands Party won four district seats and four Territorial At-large seats. Those who received the seats from the party are Andrew Fahie, Kye Rymer, Dr Natalio Wheatley, Vincent Wheatley, Sharie de Castro, Neville ‘Sheep’ Smith, Shereen Flax-Charles, and Carvin Malone. Progressive Virgin Islands Movement candidate Melvin ‘Mitch’ Turnbull, Progressives United leader Julian Fraser, and the NDP’s three elected candidates Mark Vanterpool, Alvera Maduro-Caines, and Marlon Penn received the other five seats.

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Friday, February 22, 2019

BVI FSC Issued Statistical Bulletin for Q3 2018

Last week the British Virgin Islands Financial Services Commission has published the fifty-second volume of Quarterly Statistical Bulletin, where provided analysis and statistics on the financial services industry in the third quarter of 2018.

According to the information provided by the Registry of Corporate Affairs, which is responsible for maintaining the required Registers of Companies, in the three months ended on September 30, 2019 there were 9,575 Business Companies incorporated in the jurisdiction, which is an increase as compared to 9,126 BC’s registered in the second quarter of 2018, and a 25.34% increase compared to 7,639 companies incorporated in the third quarter of 2017. Total number of BCs on the BVI Register as at 30 Sept 2018 was 422,594. 99.86% of Business Companies registered in the BVI are Companies Limited by Shares.

There were 114 new Limited Partnerships formed in Q3 2019 - compared to 38 in the previous quarter of 2018 and 23 in the third quarter of 2017. As at 30 September there were 917 active Limited Partnerships as a result of the steady increase of their number. 

In Banking, Insolvency and Fiduciary services, there was 1 Restricted Banking License and 6 General Banking Licenses issued in the third quarter of 2018. Total Deposits rose by US$467,284 (27.92%) in Q3 2018 when compared to total deposits in Q3 2017 and by US$119,544(5.91%) when compared to Q2 2018. For BVI licensed commercial banks, net interest income was US$68,648 - this is 4.81% increase when compared to Q3 2017, and 46.97% increase when compared to Q2 2018. Also, in Q3 2018 3 new Investment Business Licences were issued, making total number to reach 411 at 30 September 2018.

According to the statistics of the Enforcement Committee, there were 53 enforcement actions levied; 1 administrative penalty, 4 public statement, 1 licence revocation and 2 strongly worded letters against licensees. More information and details can be found on the home page of the Financial Services Commission.

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Friday, February 15, 2019

BVI will Choose New Premier, Political Parties are to Adhere to Code of Conduct

Political parties which will participate in the general elections in the British Virgin Islands on February 25, 2019, as well as the general public, are asked to strictly adhere to the provisions of the Code of Conduct. According to the statement of the BVI government, “The Code of Conduct now exists for political parties and candidates with the 2019 amendment to the Elections Act now in force. The purpose of the code is to promote conditions that are conducive to free and fair elections, and a climate of tolerance in which electioneering activity may take place without fear or coercion, intimidation or reprisals.”

The code consisting of 11 clauses covers the following areas: politically-motivated violence or intimidation, prohibited conduct: conduct during polling period, announcements of results of elections and respect for media and journalists. 

During the elections, the new political leader will be chosen for the BVI, as Orlando Smith has retired from his post of the territory’s premier. Mr. Smith’s National Democratic Party (NDP) has fractured, opening the possibility for a new party, the Progressive Virgin Islands Movement, to enter the government after long years of the NDP and the Virgin Islands Party domination. The VIP also fractured after the 2015 elections: Andrew Fahie will lead the VIP, while Julian Fraser split to form his own party, the Progressives United.

The new BVI government will face many issues, including the BVI financial sector challenges and the possibility of being potentially blacklisted by the European Union and being subject to the recently implemented UK beneficial ownership rules.

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Friday, February 08, 2019

CPA British Islands & Mediterranean Region Invited to Conduct Election Observation Mission in BVI

The Commonwealth Parliamentary Association British Islands and Mediterranean Region (CPA BIMR) was invited by the BVI Governor with approval of the BVI Premier and Leader of the Opposition to conduct an Election Observation Mission (EOM) to the British Virgin Islands in 2019

The Mission will observe political campaign, electoral administration, polling and other aspects of BVI elections against international standards, commitments and obligations, as well as BVI legislation. It will issue a preliminary report with initial results within two days upon the elections, and the closing result, which will include recommendations for possible electoral reform, within two months after the elections.

The mission will consist of six members, all of them from different countries, and will be supported by a core team of an election coordinator and two election specialist analysts.

CPA BIMR is one of the nine regions of the network, with its headquarters based in the UK Branch of the Commonwealth Parliamentary Association. Since 2011, the association has been organising short-term Election Observer Missions across the UK Overseas Territories including the British Virgin Islands, Anguilla, Montserrat, Turks and Caicos Islands, Cayman Islands and Jersey. It was also involved in election assessment during the UK General Elections.

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Saturday, January 19, 2019

UK Government Extending Deadline for Public Registers in BVI

The UK government has given its Overseas Territories including the British Virgin Islands an allowance to continue without implementing the public registers of company beneficial ownership until the year 2023. In fact this is a 3 year extension to the initial deadline set by the United Kingdom in its Sanctions and Anti-Money Laundering Act, which was forcing to implement public registers by the year 2020.

UK Minister responsible for OTs, Lord Tariq Ahmad, gave his comments about the deadline extension: “It is our intention that if by 2020 there is no public register, for whatever territory, we will then issue an Order in Council, which will then have a requirement for an operational public register by 2023.” By his words, the 2023 deadline will give the UK time to advance its mission of making public registers become a global standard

The public registers mean that the BVI along with other Overseas Territories will be required to disclose the names of beneficial owners of offshore companies registered in the jurisdictions. The BVI is objecting the implementation of public registers before they become a global standard, as it would place the territory in a disadvantageous position to other countries providing financial services.

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Monday, January 07, 2019

BVI Passes The Economic Substance (Companies and Limited Partnerships) Act

According to the announcement of BVI Premier and minister of finance, Dr Orlando Smith, the territory has passed The Economic Substance (Companies and Limited Partnerships) Act, 2018, which came into force on January 1, 2019. This is an important legislation addressing the EU’s concerns over “economic substance”, ahead of the December 31 deadline set by the European union for the British Virgin Islands and other financial centres.

In his comments BVI Premier said: “The government has engaged closely with EU officials over the last 18 months to understand and address the concerns that have been raised and has consulted on a regular basis with representatives of the financial services industry. Dialogue with the industry will continue to ensure smooth implementation of the new requirements and the International Tax Authority is issuing a guidance note to accompany the new Act.” 

Also, the BVI government admitted that the legislation will create challenges for some companies and limited partnerships, mostly due to the compressed timeline. It is expected that the formal response of the European Union will be given after some months.

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Monday, December 10, 2018

BVI Government Approved Bill on the Issue of Economic Substance

BVI Premier and Minister of Finance Dr Orlando Smith announced that the BVI Government has taken measures to respond to the EU’s listing of non-cooperative jurisdictions, and will take reasonable steps to address EU economic concerns. The government approved the Bill , which is planned to be considered in the House of Assembly on December 13, and to come into effect by December 31, 2018, which is the EU deadline.

The new legislation will provide further assurance which was required from the BVI on the issue of ‘economic substance’. It is to introduce economic substance requirements for all business companies and LPs which are registered and tax resident in the British Virgin Islands.

Every corporate service provider will have to know where the company or limited partnership is tax resident and must be ready to provide that information to the BVI’s competent authorities. If tax resident in the BVI, they must show ‘economic substance’. Companies or LPs must, in relation to any relevant activity, carry out core income generating activities in BVI. Among them are: banking business, insurance business, fund management business, finance and leasing business, headquarters business, shipping business, holding business, intellectual property business, and distribution and service centre business.

For the last months, the BVI government had regular consultations with representatives of financial services industry, to address the concerns, and will continue dialogue for smooth implementation of the new requirements.

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Saturday, November 24, 2018

Premier Announced New Ministerial Appointments in BVI Government

This week, BVI Premier Dr Orlando Smith appointed honourable Marlon Penn as the new Minister of Health and Social Development, and Honourable Hubert O’Neal as the new Junior Minister of Tourism. This happened after Ronnie Skelton was revoked from his post as Minister of Health and Social Development, and Archibald Christian lost his post of Junior Minister of Tourism.

Ronnie Skelton was terminated in his post after he reportedly told to local media that his was the leader of the breakaway political party known as the Progressive Virgin Islands Movement. This was named by Premier as a ‘clear conflict of interest’, as it is impossible to stay a member of Cabinet and form own party at the same time. The similar reason was for firing Archibald Christian from his post. 

Also, Second District Representative Melvin Turnbull, who wrote to the Speaker of the House of Assembly last week requesting to be seated on the Opposition side of parliament, left the NDP government. Christian and Turnbull have already announced their alliance with Progressive Virgin Islands Movement.

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Monday, November 12, 2018

Director for Overseas Territories Paying Visit to BVI

The director for Overseas Territories in Britain’s Foreign and Commonwealth Office Ben Merrick made a four day visit to the British Virgin Islands, during which he was focusing on governance, financial services of the territory, and the post-hurricane recovery. He was talking with the BVI Premier and Minister of Finance Dr Orlando Smith, the Cabinet, the leader of the opposition and representatives of the financial services industry.

One of the main purposes of the visit is to evaluate the influence of financial and technical support from the UK to the BVI after hurricanes, and to discuss further funding and loan guarantees for BVI recovery and development. Government departments and agencies visited by Merrick include the Royal Virgin Islands Police Force, the Department of Disaster Management, the BVI Ports Authority, the BVI Airports Authority and the Recovery and Development Agency.

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