Friday, November 30, 2007

11 Month FDI Statistics in Vietnam: $15 Billion Attracted, BVI the Second in the List of Top Investors

According to the 11 months statistics on Foreign Investments in Vietnamese economy, in this period the country attracted $15 billion in FDI. Pahn Huu Thang, the director of the Foreign Investment Department at the Ministry of Planning and Investment, attributed this to the country's political stability and the fact that investors gained more confidence in the economically booming Southeast Asian country. He also said that Vietnam's admission into the World Trade Organization contributed to the rise in foreign investment.

The list of foreign investors in the 11 months through November is topped by South Korea, with the investment capital of $3.7 billion. The British Virgin Islands are, again, in the second place with $3.5 billion, - compared to US$1.73 billion FDI, reported in the 10 month statistics. The BVI are followed by Singapore with $1.5 billion.

By words of Thang, they expected foreign investments to top $16 billion till the end of this year, - the amount that would top last year's previous annual record of $12.2 billion by more that 30%.

Since 1988, the government of Vietnam has licensed more than 8,000 foreign investment projects worth about $80 billion.

Wednesday, November 28, 2007

BVI Premier Hon. Ralph T. O'Neal Speaking on Offshore and Financial Matters in his Yesterday's Presentation

In his speech on November 27, 2007, the Premier Hon. Ralph T. O'Neal addressed the territory with a report on the main achievements for the first 90 days of work in the office, and on the First Meeting with the UK Government.

In the part of the presentation that concerned the Financial Services Industry, the Premier talked about meeting of the Cabinet and the Financial Services Commission, to discuss their annual report for 2006 and their work plans for 2008.

In the course of discussions, it was decided that the Commission would meet informally with the House of Assembly, in order to discuss with its members the matters related to the financial services industry. Also, it was proposed that a seminar would be held sometime next year for members of the House of Assembly and Permanent Secretaries and senior officials, in order “to get more people in the Territory to understand and appreciate what the financial services industry means to the Territory.”

The Premier very positively evaluated the familiarization visit of a Chinese delegation from the Ministry of Commerce (MOFCOM) of the People's Republic of China that took place on November 8-10. During several meetings with key officials, the Chinese delegation discussed several issues concerning company registration and establishment, exposure of the information of registered companies, Administration of Foreign Exchange and taxes, and co-operation with international and finanacial regulatory institutions.

Today, the Premier leaves the Territory, to attend the ninth annual Meeting of the Heads of Government of the United Kingdom Caribbean Dependent Territories. Among the questions to be discussed at the Conference there are: UK's action plans for combating international corruption, constitutional modernization, OECD harmful tax initiatives, European Union Savings Tax directive, etc. Among other matters discussed there will be the National Audit Office report on the management of risk in the overseas territories.

Premier Hon. Ralph T. O'Neal also has been invited by the House of Commons Foreign Relations Committee to give evidence regarding the Territory, and he expects to have a one to one talk with the Under Secretary of State, Mrs. Meg Munn.

The Premier is planning to hold discussions on the complete purchase and development of the Virgin Gorda airport, - the project that was started in 2002 . He will also visit the famous BVI House, to hold there some of his meetings with the private sector.

Monday, November 26, 2007

BVI Premier hosts 10 member delegation from the China Ministry of Commerce

Premier of the British Virgin Islands, Honourable Ralph T. O'Neal, hosted a 10 member delegation from the Ministry of Commerce (MOFCOM) of the People's Republic of China headed by its Vice Minister Madam Ma Xiuhong. It was the familiarisation visit of Chinese delegation to the territory, and its members held meetings with Governor David Pearey, the Premier, Mr Robert Mathavious, Managing Director of the Financial Services Commission, the Director of the International Affairs Secretariat Mrs. Lorna Smith and members of the private sector.

The visit included a day trip of the delegation to Virgin Gorda and a lunch hosted by the Premier O'Neal. In his speech, the Premier said that it is important to build on the relationship between the two countries since the British Virgin Islands play an important role in the economy of China.

Before visiting the Territory, the delegation of China also made visits to the Cayman Islands and United States Virgin Islands.

Friday, November 23, 2007

BVI FSC Publishes Series of Documents on Anti-Money Laundering issues

Recently the British Virgin Islands Financial Services Commission has published a series of new/updated/amended documents related to anti-money laundering issues:

  • The Liberia (Restrictive Measures) (Overseas Territories) (Amendment No 2) Order 2007
  • The Lebanon (United Nations Sanctions) (Overseas Territories) (Amendment) Order 2007
  • The Iran (United Nations Measures) (Overseas Territories)(Amendment)Order 2007
  • Notice of Revision of Consolidated List of Individuals on whom a Travel Ban and assets freeze have been imposed
  • Notice of Revision of list of Individuals and Entities associated with Usama Bin Laden, Taliban and Al-Qaida
  • Notice of the list of Revision of Consolidated List of Persons connected with the Taliban and Usama Bin Laden
  • The North Korea (United Nations Measures) (Overseas Territories) (Amendment) Order 2007
These documents describe United Nations sanctions, certain restrictive measures (such as procurement of military goods and technology, supply of specific proliferation-sensitive goods, asset freezing), imposed by the European Union members to uncooperative countries as well as contain lists of individuals and entities subject to a travel ban and assets freeze.

Wednesday, November 21, 2007

BVI Financial Services (Administrative Penalties) Regulations Amended by Adding Late Penalty Schedule

On November 16, 2007, the British Virgin Islands Financial Services Commission published the amendments to the Financial Services (Administrative Penalties) Regulations.

These amendments are published to update the previous version of the BVI Financial Services (Administrative Penalties) Regulations, which was gazetted on 14th December, 2006 and came into effect on 15th January, 2007. The amendments were gazetted on 27th September, 2007 and came into effect on 31st July, 2007.

Administrative Penalties Schedule is redesigned as Schedule 1 and Late Penalty Schedule (Schedule 2), and completely new subsection 5A (describing late penalty Schedule 2) is introduced by the amendments 2007:

5A. (1) The Commission may impose an administrative penalty on a licensee in accordance with Schedule 2 where the licensee fails to pay
(a) any fee or charge payable under the Act or any regulatory legislation; or
(b) any penalty payable under these Regulations on or before the date upon which the fee, charge or penalty is due for payment.
(2) Where the Commission decides to impose a late payment penalty on a licensee under subregulation (1), it shall send a penalty notice to the licensee stating
(a) the fee,charge or penalty in respect of which the penalty is imposed; and
(b) the amount of the proposed penalty calculated in accordance with Schedule 2.
(3) Subject to regulation 8(6), a licensee that receives a penalty notice shall pay the penalty stated in the notice to the Commission within fourteen days of receipt of the notice.”

Late Penalty Schedule 2 is introduced in the following redaction:

Description of Fee/PenaltyPenalty payable
1. Penalties for late payment of fee or charge payable under any regulatory legislation
For the late payment of a fee or charge payable under any regulatory legislation
(a) Where the fee or charge is paid 1-30 days after due date20% of fee or charge payable, subject to a minimum of $80.00
(b) For each additional period of 30 days, or any part thereof, during which fee or charge remains unpaid10% of fee or charge payable, subject to a minimum of $20.00

The maximum penalty payable under paragraphs (a) and (b) shall be 100% of the fee or charge payable
2. Penalty for late payment of administrative penalty, other than late payment penalty)
For the late payment of an administrative penalty imposed under Schedule 1
(a) Penalty paid 1-30 days after due date10% of penalty payable
(b) For each additional period of 30 days, or any part thereof, during which penalty remains unpaid10% of penalty payable

The maximum penalty payable under paragraphs (a) and (b) shall be 100% of the administrative penalty payable”

Other sections as well as Schedule 1 of the BVI Financial Services (Administrative Penalties) Regulations are amended accordingly.

Saturday, November 17, 2007

BVI Insurance Association looking for ways to rescue BVI domestic insurance business

The BVI Insurance Association that was recently formed to work in the domestic insurance sector, is to deal with many issues affecting the industry and to address many challenges, some of them even threatening functioning of the sector.

The President of the BVI Insurance Association and the Managing Director of NAGICO Insurance Company Shan Mohamed has told about the main problems of onshore insurance industry. He said that members of the Association would need to come together and agree to work with certain parameters, to ensure that the industry remains strong, and customers' interests are respected and protected. The President of the Association expressed concern over too large number of accidents in the BVI, and said the association will lobby to Government to address this issue.

An important point made by Mohamed is that the association was formed to protect the domestic insurance industry in the BVI, because financial institutions, for example banks, are seeking to enter the property insurance market, and their number may be critical to other companies, particularly medium and small insurance agents. By his words, this becomes common practice in developed countries, and the current situation should be evaluated by the BVI FSC and other Government bodies responsible for the approval of new licenses.

After saying a few words about the problems of onshore insurance business in BVI, we should note that BVI offshore insurance business is sound and perfect. Offshore insurance business in BVI is another good example how offshore jurisdiction can improve the quality of offshore financial services. Industry professionals should remember how in early 90s there were couple thousand captive insurance companies registered on the BVI. Most of them were shell captives, some were related to grey business, and even money laundering. By introducing stringent requirements to minimum capital, due diligence and other measures, the number of licences was reduced to several hundreds, but BVI dramatically improved the quality of BVI-licensed captive insurers.

Parent companies for most BVI-licensed captives are located in the U.S. However, the offshore territory is of global importance, being the basic jurisdiction for captives from such countries as Switzerland, Guernsey, Taiwan, South America and the Middle East.

Wednesday, November 14, 2007

Amount of FDI in China Rises, BVI the Second in the List of Top Investors

China's Ministry of Commerce has published the ten months statistics of Foreign Direct Investments in Chinese economy. From January to October, the number of newly established foreign-invested enterprises reached 30,826 – 6.78% less if compared to the same period of the last year, and the amount of utilized FDI was US$53.995 billion – up 11.15% compared to the same period of 2006.

According to the information released a month ago, FDI level in China continued to rise. In October the number of newly established foreign-invested enterprises was 2,620 – down 14.01%. However the utilized FDI totaled US$6.776 billion – that is up 13.18%.

In the current top list of countries having the largest FDI in China, the British Virgin Islands are ranking the second, with US$12.914 billion of FDI. They are preceded by Hong Kong (US$18.655 billion), which is traditionally the major FDI source for China. Other countries on the list are South Korea with US$2.945 billion, Japan (US$2.81 billion), Singapore (US$2.245 billion), the United States (US$1.987 billion), the Cayman Islands (US$1.788 billion), Samoa (US$1.457 billion), Taiwan (US$1.294 billion), and Mauritius (US$907 million).

The amount of FDI made by the top 10 countries and territories including British Virgin Islands accounts for nearly 87.05% of the total FDI utilized in China in this period.

Monday, November 12, 2007

BVI IFC Hosts Roadshow in London

This month, the BVI International Finance Centre hosted a roadshow in the city of London to demonstrate its commitment to what is widely recognised as the world's financial capital. The BVI IFC has informed about its plans to visit London, Dubai and Qatar and some regions of Asia, in February 2007, when CEO of BVI IFC Mr.Humphry Leue reported about selecting the roadshow destinations and other marketing initiatives in 2007.

Hosting roadshows in different parts of the world is one of the ways how the BVI territory is popularized by the BVI IFC, and the Financial Services Commission. The event in London that lasted for three days, followed the London Presentation organized by the BVI International Finance Centre in October; this time, it included a series of business development meetings with senior figures at London's leading private banks and law firms. Also, the BVI side organized evening receptions during which more than a hundred delegates were briefly informed on the new developments and opportunities in the BVI's Trust and Corporate business sectors.

Delegates were addressed by the Deputy Premier of the BVI, The Hon. Dancia Penn OBE, the Executive Director of the BVI International Finance Centre Lorna Smith, and the Deputy Managing Director of Regulation at the Financial Services Commission, Kenneth Baker. Some of the BVI's leading financial services practitioners also made their presentations. On the whole, the roadshow delegates were provided with an update on the regulatory environment, legislation, and current trends in trust and corporate business.

Sherri Ortiz, Chief Operating Operator of the BVI IFC, has concluded, - "We were pleased that the Roadshow attracted such interest and delegate feedback suggests that the bond between the BVI and the London financial community will continue to strengthen in the months and years ahead."

Monday, November 05, 2007

The Number of BVI Business Companies Exceeded the 800,000 level in the Second Quarter 2007

By the data provided last week in the BVI FSC 2nd Quarter Statistical Bulletin for 2007, the total number of BVI Business Companies achieved 802,850 by June 30 of this year. According to the BVI companies registration statistics that shows the dynamics of companies' growth in 2006, the number of new registrations is constantly increasing, and the data for the second quarter 2007 confirm the continuing growth.

Just simple illustration by 5-year statistics of BVI business companies registered in the first quarter and in half a year (not cumulative):

YearCompany incoporations in Quarter 1

YearBVI Company incoporations in half a year

The statistical bulletin also includes the statistics of banking & fiduciary industries: in the first half of the year 2007 there are one Class I Trust, one Class III Trust and three Restricted Class II Trusts registered.

The investment business sector statistics indicated that 24 new Mutual Fund Managers have been registered in the BVI, 154 new Professional Funds, 48 new Private Funds and 2 new Public Funds. The cumulative number of BVI registered Funds as at 30 June 2007 is 1548 Professional, 791 Private and 211 Public Funds. By the structure of BVI registered Funds, during the first half of the year 2007 the proportion of Professional Funds (by the number of Funds) increased from 59% to 61%, but the portion of Private Funds and Public Funds has reduced from 32% to 31%, and from 9% to 8% respectively.

Thursday, November 01, 2007

BVI FSC Issues 2nd Public Statement on Boston Life and Annuity Company Limited

Yesterday the British Virgin Islands Financial Services Commission has issued the 2nd Public Statement concerning Boston Life and Annuity Company Limited, pursuant to Section 37A of the Financial Services Commission Act 2001. The document was published on the official site of BVI FSC on October 31.

The previous public announcement concerning Boston Life and Annuity Company Limited, and signed by managing director/CEO of the Commission Robert Mathavious, was published on July 13 of this year. Both public statements were issued to protect the public interest of those who are related to Boston Life and Annuity Company Limited, including customers, creditors, or investors of the company.

In the public announcement published on July 13, 2007, the Commission issued a directive to the company, that prohibited Boston Life to enter into new contracts for insurance business for 90 days, until the notice provided by the BVI FSC. In the last public statement, BVI FSC informed that:

- The cease and desist Directive published on July 13 to Boston Life and Annuity Limited is extended, until such further date as the Commission may specify.

- The Directive was extended in order to facilitate the Commission's ongoing investigations into the Company, and for the preparation of the investigative report by Kroll Inc., the Examiner conducting the investigations on behalf of the Commission.

Among the other documents issued by the BVI FSC during this year to protect general publics from scams, misunderstandings or offences, there was also Advisory Warning No. 1, concerning Dexter Insurance Company, Ltd.