Sunday, November 30, 2008

BVI premier speaks on budget cuts

Hon. Ralph O'Neal, the premier of the British Virgin Islands, made an announcement that construction projects will be placed on hold, because of the global financial crisis and reduction of the budget connected with it.

The BVI premier said the economic situation in the country could improve in the next six months, if the measures will be taken by the U.S., Europe and other countries. O'Neal said that the BVI expects a decline in tourism, which it depends on for the bulk of its revenues. In September, about 276,000 tourists arrived in the country – about 1% decrease from the last year.

The 2009 budget is expected to be present in January. Hon Ralph O'Neal noticed that government programs related to education and health will be financed as much as possible.

Friday, November 28, 2008

Conifer Securities adds key executives to the BVI Fund Administration Services

One of the leading middle and back-office services providers, Conifer Securities, LLC, announced the hire of two executives to its offshore fund administration business in the British Virgin Islands, Conifer Fund Services Ltd. (CFS).

David Bateman
will be an associate director, and Donna-Maria De Roche will serve as an account manager for the fund. Both of them have expertise in providing offshore services to US-based hedge funds and alternative asset managers.

Peter O'Connell, managing director of the BVI and San Francisco-based Conifer Fund Services Ltd., said that hedge funds more than ever need to be disciplined and efficient, and the experience of the newly hired specialists will prove extremely valuable to the BVI fund and its clients.

Mr Bateman joins Conifer after working seven years in the offshore financial services industry. He held the position of Fund Administration Manager at UBS Fund Services (Ireland) Ltd., and prior to this position he was a Fund Administration Manager at UBS Fund Services (Cayman) Ltd., and a senior accountant at Bank of America (Cayman) Ltd.

Ms. De Roche has worked for five years at Fortis Prime Fund Solutions (BVI) Limited, where she received experience in administering funds with varying legal structures and investment strategies. Before going into the funds industry, she spent nine years at the PricewaterhouseCoopers office in Trinidad in the position of an audit and business advisory manager.

Conifer Fund Services (BVI) Ltd. was launched in 2006 as part of the Conifer Securities LLC, which has headquarters in San Francisco, New York, Boston and the British Virgin Islands and is working in this business since 1989, providing accounting services across a broad range of investment disciplines to both onshore and offshore funds. The services of the fund include fund accounting, fund performance and benchmark reporting, performance and management fee calculation, generation of required financial records, reports and documentation needed to support annual audit and tax preparation by outside auditors.

Tuesday, November 25, 2008

BVI Team Participating at World Travel Market in London

The four members delegation represented the jurisdiction of the British Virgin Islands at the World Travel Market which took place in London from November 10 until November 13. This Market organized annually is a major networking and business event for travel industry officials.

According to the Acting Director of Tourism Hadassah Ward, the British Virgin Islands delegation participating in the event was engaged in competitive research. She described the Market as a place providing huge opportunities for business and, but also said that its high cost negatively affects BVI participation.

By words of tourism official, this year's BVI delegation had the purpose to draw more attention to the BVI tourism and show that the territory is open for business, being still one of the best destinations in the Caribbean.

Further on, Ward stated that the economic downturn in the U.S. and the financial crisis are having global effect, and also the potential impact on the tourism industry, so more targeted advertising is needed, with the purpose to focus the efforts of the BVI Tourist Board.

Other members of the delegation who attended the World Travel Market were Abigail O’Neal, who is Marine/Online Specialist, Lynette Harrigan, Emerging Markets and Niche Marketing Manager, and Perla George, the General Manager of North America, Sales.

Wednesday, November 19, 2008

BVI Delegation Participates in 48th OECS Meeting

This week, a delegation from the British Virgin Islands will take part in the 48th meeting of the Authority of the Organisation of Eastern Caribbean States (OECS). The meeting will start in Montserrat on November 20, with an opening ceremony which will be attended by Representative for the Fifth Electoral District Elvis Harrigan, Permanent Secretary in the Premier's Office Rosalie Adams, and Assistant Secretary for External Affairs Najan Christopher. Closing of the meeting is planned on Friday.

The delegates will adopt the report of the 47th meeting of the OECS Authority and a number of issues relating to the OECS economic union, geopolitical relations, trade, macro-economic development, social and sustainable development, disaster management, and the implementation of the recently signed CARIFORUM-European Union Economic Partnership Agreement (EPA).

Among other problems to be discussed, the OECS delegates will also discuss the investments by OECS member states in biodiversity management, HIV/AIDS Project Unit, the Pharmaceutical Procurement Service (PPS) and the status of the 2008 OECS Human Development Report.

OECS consists of nine members including two associate members, one of them being the British Virgin Islands. The OECS Authority is the highest decision making body of the organisation, which includes the Heads of Government of member states.

Friday, November 14, 2008

BVI FSC Publishes Statistical Bulletin for the Second Quarter of 2008

On 7 November 2008, the BVI Financial Services Commission published the eleventh volume of Quarterly Statistical Bulletin, covering the changes and progress in different sectors of British Virgin Islands financial services industry. In this volume, statistical and other information for the period as of June 30 2008 is cumulated, including figures from the Registry of Corporate Affairs, from Banking & Fiduciary services sector, Mutual Funds and Insurance industries.

In the second quarter 2008, there were 15,831 offshore companies registered in the British Virgin Islands – a little less than in the same period of 2007 with 17,803 new incorporations. However it is more than in any 2nd quarter of years 2003-2006. Below, you can see the chart showing the dynamics of BVI company formation in Q2 of the years 2003-2008.

Year (Q2)BVI offshore companies incorporated in Q2 (IBC and BC)
20039,602
200413,118
200514,666
200615,517
200717,803
200815,831

The cumulative number of offshore companies registered in the BVI and actively working at June 30, 2008 was 445,865. There were 532 Limited Partnerships of the whole amount of companies having active status by June 30, 2008. There were 26 Limited Partnerships registered, compared to 28 registered in Qtr2 2007, and 32 in Qtr1 2008. Obviously less number of incorporations in the period from April to June 2008, if compared to the offshore company formation statistics for the year 2007, partially might be the result of global economic recession, however there could be also some offshore jurisdiction related issues.

Along with less companies incorporated, there were also less dissolutions fixed by the BVI FSC - 9,268 in the period from April to June.

Banking and Fiduciary statistics estimated by the Commission showed cumulative figures as of June 30 2008 that included 98 Class I Trusts, 2 Class II and 4 Class III Trusts, and 109 Restricted Class II Trusts registered.

According to the Investment Business Statistics for the period ended on June 30 2008, total number of managers and administrators newly registered in the jurisdiction has also reduced, as well as the total number of professional, private and public mutual funds. The Statistical Bulletin includes the dynamics of active mutual funds registrations in the similar periods of 2006, 2007 and 2008.

Saturday, November 08, 2008

BVI FSC Publishes Draft Regulatory Code

A month ago the BVI Financial Services Commission issued Draft Regulatory Code 2008 - a consultative document under the Financial Services Commission Act, 2001. The document was published by the BVI FSC on October 10.

The Financial Services Commission Act , 2001, and the Regulatory legislation for which the Commission bears responsibility, together establish a general legal framework for the regulation and supervision by the Commission of financial services industry in BVI. Regulation and supervision of financial services is quite complex, and from the practical point of view it is not worth to include the details in the primary legislation, which should not be changed frequently.

With the purpose to keep the regulatory framework in balance with changing international standards in the financial services area, the FSC Act, 2001 enabled the Commission, as BVI financial services regulator, to issue Regulatory Code. This document contains more detailed requirements that support and sometimes supplement basic framework established by the primary legislation.

Part 1 of the Draft Code contains certain fundamental principles of business that apply to all licensees. The requirements of general application that apply to every licensee, regardless of the type of licence held, are set out in Part 2. Following parts of the draft Regulatory Code include additional requirements on specific types or categories of licensees: Part 3 includes banking requirements, Part 4 contains insurance requirements; Part 5 contains requirements applicable to trust companies and company managers; Part 6 - requirements applicable to persons licensed under the Securities and Investment Business Act, 2008, except for mutual funds. Requirements applicable to mutual funds are given in Part 7.

Being a subsidiary legislation, the Regulatory Code has the status of “law”, meaning it has the same legal force as if it had been contained in the basic financial services legislation of the BVI.

Thursday, November 06, 2008

Warning on BVI firm Ross-Parkinson and NY-based International Equity Portfolio

The Swedish Financial Supervisory Authority, Finansinspektionen, has reported that Ross Parkinson (www. rossparkinson .com), having its headquarters in the British Virgin Islands and using the address Wickhams Cay, Road Town, Tortola, BVI, as well as New York-based International Equity Portfolio, are offering investment services without the required authorisation, and therefore they are not entitled to provide financial services.

Representatives of Ross-Parkinson have contacted investors by phone offering to buy their holdings of shares, however in advance they are asking the investors to pay a fee. This may be called an advance fee fraud scheme.

This warning was published on public sites with the purpose to protect the investing community.

Tuesday, November 04, 2008

BVI FSC Publishes Public Statement Suspending Activities of the BVI-registered Fund

The British Virgin Islands Financial Services Commission issued a public statement pursuant to the Financial Services Commission Act, 2001, concerning Reserve International Liquidity Fund Ltd. The purpose of this public announcement by the BVI FSC is to protect the interests of the customers, creditors or investors of this BVI Offshore Fund, registered in 1999 under the BVI Mutual Funds Act, 1996.

In October 2008, the Commission received complaints from investors who alleged that the Fund has improperly valued its bond holdings in an institution which had filed for bankruptcy. The complaint specifically alleges that the Fund failed to appropriately mark down the value of these bonds, and further allowed certain investors to redeem their investments at par value, before taking action to write down the value of the bonds which made the Fund's remaining investors to absorb the loss associated with these bonds.

Investigations into the Fund's activities were commenced on 10 October, when the Financial Services Commission asked for detailed information and records from the Fund to establish the relevance of allegations against it. While investigations into the Fund are continuing, the Commission issued a directive to the BVI Fund, requiring it, until further notice, to suspend the shares subscription and their redemption to investors, as well as submit monthly reports to the Commission that would include the details of its cash balance and investments, and an update on all ongoing litigation where the Fund is involved.

In the course of investigation of Reserve International Liquidity Fund Ltd, the FSC will provide an update.

Monday, November 03, 2008

OECD Plans to Strengthen Standards Regulating Offshore Financial Industry

The OTCC Meeting in the course of which BVI signed taxation agreements, has been held in the period when the OECD prepared to crackdown on offshore and low-tax financial centres which were still deemed to be “uncooperative”. This was part of plans by the member governments of OECD to further strengthen regulatory safeguards in the global financial system, and followed the publication of parliamentary reports that accused the Foreign and Commonwealth Office of complacency in the monitoring of tax evasion and money laundering risks in certain offshore financial centres.

In the last period, the UK government has experienced the increasing pressure to enforce higher standards of transparency in some of the 14 offshore territories, which are still under British sovereignty, and among then there are British Virgin Islands.

According to the UK Authorities Report on Financial Services Regulation in BVI and other offshore centres, published in May 2008, the regulation standards in the areas such as banking, money laundering, insurance and securities are not as good as those in the Crown Dependencies (Jersey, Guernsey and the Isle of Man).

These claims and submissions were discussed by the BVI and the Cayman Islands, and by some other offshore centres among British dependencies. The offshore jurisdictions argued that they have brought their regulatory standards in accordance with the OECD FATF requirements.

The BVI government informed the Commons Select Committee on Foreign affairs that the claims that the so-called offshore centres are not properly regulated and are a haven for tax evasion, money laundering and terrorist financing, are unfair, and 'too often no effort is made to give recognition to the regulatory advances of such offshore jurisdictions as the BVI.'