Premier Commented on the Impact of HK Protests on BVI Financial Services Industry

BVI Premier Andrew Fahie stated that the BVI financial services industry have had a minimal impact from the recent political protests in Hong Kong; answering the question from the Opposition in the House of Assembly, he stated that neither the financial industry itself nor the British Virgin Islands as a jurisdiction of choice were influenced significantly, due to the fact that most protests are announced ahead so that authorities and media know the potential obstacles in advance.

According to Premier, economic losses following those protests are minimal. Regarding BVI House Asia set up in HK with the purpose to promote jurisdiction’s financial services, he said that “most business entities in the financial sector have continued as usual, including BVI House Asia.” He acknowledged that the protests have created practical inconveniences locally for those working in the branch offices of BVI law firms and other corporate service providers, however, the government’s strategy will continue to be constant monitoring of the situation and any significant changes in the financial situation that could influence the usage of BVI financial services. The BVI House Asia is providing weekly updates on the situation to the International Affairs Secretariat, the Premier’s Office and BVI Finance.

China, Hong Kong and Macau invest more than 40 per cent of the US$1.5 trillion going through approximately 400,000 BVI-registered companies.

BVI Provides Visa Exemption Policy for Chinese Nationals

Chinese nationals received the right to enter and remain in the British Virgin Islands without the need for a visa, for business and tourism only, for a period of less than 6 months. This continues the BVI visa exemption policy which went into effect on September 1, 2016, and through which foreign nationals, including Chinese people, were allowed to enter the jurisdiction without BVI visa if they held the UK, U.S. or Canadian visa.

The BVI government believes that the visa exemption will help with the country’s global marketability in tourism and financial services sector. Chinese nationals will have the right to visit the BVI for business matters related to the BVI incorporated companies, as well as litigations in the BVI courts. 

China is currently the largest tourism source market in the world, and the second largest economy. It has been the largest trading partner of the British Virgin Islands for more than 25 years. Chinese and Hong Kong companies comprise 41% of the US$1.5 trillion of assets going through the BVI.

BVI Premier on a Mission to Asia to Promote BVI Financial Services

From June 2 to 17, BVI Premier and Minister of Finance Orlando Smith was leading a delegation to a number of cities in Asia, to host mini-conferences to promote traditional and new business and financial services products of the British Virgin Islands. During his visit, he had meetings with main government and industry professionals in the Asian region.

During one of the conferences held on June 12, among the topics discussed there were BVI Advantage, the opening of Bank of Asia in BVI, new BVI products such as Micro Business Companies Act, Limited Partnership Act. This conference was attended by more than 100 practitioners from BVI and China private sector. 

The Premier commented on other meetings held: “I am pleased that we have also had productive meetings with the Ministry of Foreign Affairs, Ministry of Commerce and the China Friendship Association, all of whom welcomed the several developments in the BVI that will further the economic relationship between BVI and China.”

BVI FSC Announced Appointment of New Asia Representative

The British Virgin Islands Financial Services Commission has issued press release where announced the appointment of Mr. Burton Chalwell who will replace Mr. Leon Wheatley as the new Asia Representative of the Commission. Mr. Wheatley will return to the BVI headquarters of the BVI FSC and serve as a Deputy Director with supervision of the Compliance Inspection Unit.

The appointment of Mr. Chalwell was effective 9 October 2017, and previous representative is expected to assume his new post on 13 November 2017. In the role of Asia Rep at BVI FSC (HK) Ltd., Mr. Chalwell’s duty will be managing the delivery of services offered from the Commission’s office at BVI House Asia, and the Asia Pacific liaison for BVI Financial Services licensees and regulators with a presence in the region. 

Robert Mathavious, Managing Director and Chief Executive Officer of the Commission, commented on the appointment, saying: “Asia continues to be a key market for the British Virgin Islands and we are very pleased with the talent that the Commission has in the region and the services and expertise we can provide in Asia. We are confident that Mr. Chalwell will be an excellent addition to the team. We are also very excited that Mr. Wheatley will be coming back to Commission headquarters after a very successful stint in Asia and look forward to his continued service to the Commission and the industry.”

New Vistra Report: BVI Ranked as Top Offshore Jurisdiction

The 2017 edition of Vistra 2020 report was launched in Hong Kong and Singapore, which ranked the British Virgin Islands as the top offshore jurisdiction in the world. The United Kingdom was ranked first as the onshore jurisdiction, followed by Hong Kong as midshore; the BVI is in the third place, followed by the United States in the onshore category.

The report named "Vistra 2020: The Uncertainty Principle: The State of the Trust, Fund and Corporate Services Industry 2017" examines trends and factors affecting global financial services industry, in the period since the last report published in 2015. 

The Asian growth drivers of the financial industry listed in the report are supporting the BVI position as Asia's number one international finance jurisdiction. Investors from China and other Asian countries make use of the trust-related offerings of the jurisdiction to develop succession planning and secure asset protection under Virgin Islands Special Trust Act (VISTA) trusts and Private Trust Companies (PTCs). BVI trusts and wealth-planning services provide privacy, since assets are held in the trustee’s name.

Elise Donovan, director, BVI House Asia, said: “The newly licensed Bank of Asia, the first online, cloud-based bank, will launch later this year. It is poised to drive banking costs lower while increasing the level of convenience and efficiency afforded to customers opening BVI accounts.”

BVI Asian Trade Mission: Agreement with Chinese economic area and BVI Roadshow

The strategic cooperation agreement between the BVI government and the Administration Commission of the Tianjin Binhai New Area Central Business District (CBD) was signed, as a result of the BVI Asian Trade Mission led by premier and minister of finance Dr Orlando Smith. Tianjin Binhai New Area is one of special economic zones of China, established in 2010. The BVI and the Tianjin Binhai New Area are planning to develop long-term cooperation and mutually support each other's development strategies, systems of management and operation as long-term strategic partners.

At a BVI road show event, which followed as part of the BVI Asian Trade Mission, the BVI Premier was speaking on the theme: “Pursuing Global Success with BVI as Your International Partner of Choice”. Also, the presentation was delivered by Conyers Dill & Pearman Partner themed “The Belt and Road Initiative: How the BVI Facilitates the Investment Opportunities”. Deputy group managing director made a presentation named “The BVI: At the Cutting Edge of Incorporation”. Managing director from AMS Financial Services presented “The BVI: Balancing Client Confidentiality with International Compliance”. 

The panel discussion on the event was moderated by Permanent Secretary of Premier's Office, Brodrick Penn, and named “The BVI Advantage in the Capital Markets”, followed by the presentation “The BVI Advantage in Litigation”. The roadshow was closed by a panel titled “The Enduring Competitiveness of the BVI”.

First Days of BVI Asian Trade Mission in Hong Kong and China

BVI Premier and minister of finance Dr Orlando Smith said in his speech during the BVI Asian Trade Mission in Hong Kong that the Asia Pacific Region is a fundamental market for the British Virgin Islands. In the first days of the two week event which will make stops in HK and four cities of China, Premier headed the delegation in a number of meetings, which started with discussions with executives of Top Search International Holdings, a multi-disciplinary services group working in the spheres of insurance, asset management and banking. They discussed developments in the global and BVI financial services industry.

Among other visits, the BVI delegation had a meeting with executives of the Bank of Asia BVI Limited, to get an update information on the launch of the bank which is anticipated both by HK and BVI practitioners. 

On the first day the BVI Premier hosted a luncheon with financial services practitioners in Hong Kong, representing various sectors of economy. During the meeting Smith was speaking about the strong partnership between BVI, HK and China, about BVI advantages ad developments in the BVI financial services sector, including beneficial ownership.

On the second day of the BVI Asian Trade Mission, BVI delegation led by the Premier met with senior members of the marketing and international departments of the China National Tourism Administration; also, BVI Finance hosted the first of a series of roadshows, themed “Strategies for Global Success - BVI: The International Partner of Choice.”

BVI Launches Research of BVI Financial Services Sector

A research was commissioned by the BVI government with the purpose to examine contribution of the jurisdiction's financial services industry to the global economy. As part of the project, a research team from Capital Economics will visit the British Virgin Islands on 27-29 June to meet with representatives of the government, BVI FSC and the industry, and get preliminary results. The study will be funded both by the government and the private sector.

The main subject of the research will be financial, economic and legislative ties between the financial services industry in the BVI and the international community. It will show how BVI business structures have facilitated global commerce by connecting markets and launching global investment, trade and capital flow. Special focus will be made on BVI connections with the Chinese economy and its growth. 

According to the executive director of BVI Finance Lorna Smith, “The Capital Economics study will provide valuable research, facts and figures to help promote the jurisdiction, assist potential clients in better understanding the benefits of doing business in the BVI and challenge ill-informed voices in the international community seeking to dispute the value that the BVI’s financial services brings to global business.”

BVI Presented as Top Financial Centre at China Offshore Summit

British Virgin Islands was named the most important and most preferred offshore jurisdiction in the Asia Pacific, already for the sixth year. The survey was conducted inside and outside the region, and in respondents’ opinion BVI remains the undisputed market leader in the financial services industry.

At the 2015 China Offshore Summit, which was held in Shanghai on November 4-5, CEO of Vistra Group Martin Crawford made a presentation on behalf of BVI Finance. He said that the BVI territory held about 50 percent of the market share of new offshore companies formed globally and, of the active companies on the BVI’s registry, about 60 percent were from Asian clients. He stated that in the Global Financial Centres Index the BVI is ranked at the top of the most competitive offshore financial centres, and named some factors that help BVI remain the leader, among them legal and commercial certainty, and robust regulatory standards, being focused on “value-added” rather than pure volume.

Additionally, Crawford said that the top ten listed companies on the Hong Kong Stock Exchange and the Shanghai Stock Exchange had BVI subsidiaries.

Presentations were also made for the BVI at the Summit by group legal counsel at AMS Financial Group, Barry Mitchell, director of BVI House Asia, Elise Donovan, and managing partner in China of Harney, Westwood and Riegels, Kristy Calvert. China Offshore Summit was attended by more than 500 Chinese business leaders.

Annual BVI Asia 2015 Business Conference Held Backed by BVI House Asia

The Business BVI ASIA 2015 annual regional conference which took place on September 23 attracted more than 100 offshore industry experts and leaders from the most progressive businesses in Asia and British Virgin Islands. The conference named "Pivoting to Asia - A View Beyond the Horizon" was sponsored by BVI House Asia already for the second year.

The conference presentations included "China's One Belt One Road Regional Development Strategy: Long Term Opportunities for the Offshore Sector," made by Dr Qian Liu, director of Economics Unit, The Economist Group, Beijing; "Future Disruption in the Offshore Space: Where will the next 'Uber' come from?"; and "Emerging Wealth in China: Millionaire Households and Ultra High-Net Worth Households."

It was stated by Dr.Qian Liu that, with outbound direct investment from China having increased 35% since 2005, "Chinese companies investing in international markets want the certainty that BVI structures, backed by BVI courts and English common law, provide, rather than relying on the courts of countries in emerging markets. Second, China's fast-rising middle class will want trust funds, private wealth management and other services that the BVI can arrange. Finally, the Chinese middle class wants to spend more on tourism, a trend that began in Southeast Asia and continues in Hawaii, Tahiti and the Caribbean. As a tourist destination, the BVI sits on the rising demand for tourism."

BVI and Qianhai Held Cooperative Development Forum

On May 26, the Qianhai-British Virgin Islands (BVI) Cooperative Development forum was held in Shenzhen, PRC, hosted by deputy-directors general of Qianhai Authority who provided latest information on Qianhai’s achievements and future plans. More than 200 financial practitioners and enterprise representatives took part in the forum.

Under the name “Development for cross-border finance under new economic circumstances”, the forum included discussions related to cooperation between BVI and Qianhai, BVI business opportunities and legislation. A panel discussion was held named “How to promote the interaction and development of Qianhai and BVI cross-border financial business.”

Director of BVI House Asia, Elise Donovan, represented the advantages of BVI financial services and company structures used for fund management and asset protection, and said that the territory is ready to deepen bilateral relations with China.

BVI and CI as Main Offshore Jurisdictions for Chinese Capital

In the South China Morning Post publication, BVI and Cayman Islands were named the main offshore hubs for China, which get the largest part of Chinese investments in the Caribbean region. The US government body informs that of US$62.1 billion in outward direct investment flows by 2012, all but US$282 million went to these two jurisdictions, while all the other Caribbean countries received only US$31 million.

By the scale of the fund flows, the British Virgin Islands has become the second-largest destination for mainland Chinese overseas direct investment after Hong Kong, being the preferred offshore tool for structuring investments into and out of Asia. 

According to the report published by the US-China Economic and Security Review Commission, in 2010, British Virgin Islands companies were responsible for US$111 billion, or 10 per cent, of foreign direct investment in China. Chinese companies invested US$69 billion overseas, of which 75% was handled by companies domiciled in the British Virgin Islands, Cayman Islands and Hong Kong. In 2012, FDI flows to the British Virgin Islands reached US$2.24 billion, while the stock of these investments amounted to US$30.85 billion.

Last year’s opening of BVI House Asia in Hong Kong facilitated the increase in fund flows. The review commission stated that China's ties with the Caribbean had strengthened over the decade, and are likely to continue expansion.

The Role of BVI Financial Centre Discussed at China Offshore Summit

BVI House Asia made the presentation named ‘BVI 2.0 – Taking it to the Next Level’, during the China Offshore Summit which was held in Beijing from May 28 to 29, and was visited by more than 300 financial intermediaries, corporate service providers, international trust companies, bankers and lawyers from China. During the presentation, the director of BVI House Asia Elise Donovan spoke about the BVI companies’ use in China and their role today in facilitating cross-border transactions in the market.

British Virgin Islands, as one of the leading financial centres for international investments, remains the top jurisdiction for inward and outward FDI flows in China. It is a connecting link for East and West markets, assisting Chinese companies to access Western capital or technology through acquisitions and listings on foreign stock exchanges. 

Another presentation was made by Harney Westwood & Riegels’ Asia managing partner Jonathan Culshaw, under the name ‘Same same… but Different, Differences between BVI and Cayman Companies’. He outlined advantages of both offshore jurisdictions, among them flexibility in structuring, neutrality, and legal and professional competence in the China/Asia market, but noted that “the BVI is better value for money.”

BVI Government Signed MoUs with Chinese Delegation

During the visit of the delegation from Qianhai Special Economic Zone and officials of the municipality of Shenzhen, there were signed memoranda of understanding (MoUs) to signal the beginning of the mutual relationship between the jurisdictions. The MoU signed between the British Virgin Islands government and the City of Shenzhen sets out the parties’ intentions to further increase bilateral cultural exchanges, to expand exchange and cooperation in areas of tourism, economy, culture, sports and other areas. The Memorandum signed between the BVI government and the Qianhai Authority sets out parties’ intentions to promote exchange and cooperation in the sphere of financial industry.

According to BVI Premier Orlando Smith, “This is a historic occasion, in that while we have had visits from Chinese delegations in the past, this is the first time that we are having such a significant delegation to forge a closer relationship.” Also, speaking about the establishment of BVI House Asia in September 2013, Smith noted that a major component of his government’s strategy is to expand and deepen the commercial footprint of the territory in Asia as one of the most important global markets. 

The member of the Standing Committee of the CPC Guangdong Provincial Committee and party chief of the CPC Shenzhen Municipal Committee, Dr Wang Rong said about the opening of BVI House Asia: “We warmly welcome BVI companies and institutions to strengthen overall and multi-layered cooperation with Shenzhen in various fields, and to share development opportunities with us for a better future.”

Qianhai/Shenzhen Delegation Visits BVI to Discuss Economic and Financial Cooperation

The delegation from Qianhai Special Economic Zone and senior officials of the municipality of Shenzhen in the province of Guangdong, China, will visit the British Virgin Islands on January 9- 12 of 2014. The Qianhai/Shenzhen visit to the BVI will be headed by party chief of the Shenzhen Municipal Committee Dr Wang Rong.

During these days the six members of the delegation will meet with various stakeholders in the BVI to discuss the issues of cooperation in financial services, BVI economy, education and culture. They will have meetings with the governor, ministers and other senior government officials, among them the BVI FSC and the Tourist Board. The aim of the meetings is to discuss possible areas of understanding and cooperation between the BVI government and the Qianhai Authority, which is the modern service industry cooperation zone for the Municipality of Shenzhen - one of the wealthiest cities in China, ranked second in Forbes’ 2012 list of innovative mainland cities and eighth in the world in terms of its economic vitality.

'BVI House Asia' Opened in Hong Kong

The jurisdiction of the British Virgin Islands has launched Hong Kong office, which will have the functions of representing BVI in mainland China and the entire Asia Pacific region. The official opening of “BVI House Asia” was hosted by the British Consul General to Hong Kong and Macau Caroline Wilson, and took place on September 5 at the British Consulate. The event was attended by up to 100 HK professionals, as well as by leading financial services practitioners and representatives of several governments, including Hong Kong, the United States, European Union, Switzerland and Ireland.

BVI House Asia will facilitate a smooth interface between the industry in Asia and the BVI; it will allow responding to enquiries of a social, political or economic nature from the region, and promoting China’s and HK investments into the BVI economy. Other functions of the BVI office in Hong Kong will be to provide quick access for certain information services to users of BVI business companies, and to develop the relationship of the BVI with mainland China not only in financial areas but also in the spheres of education and culture. 

Through the BVI Financial Services Commission (BVI FSC), BVI House will help strengthen ties with regional government authorities. In the next few months, the Commission will also provide resources for the House, including staff, which currently includes of the interim director and a chief operating officer Heather Tang.

BVI Remains the Second Top Country for HK Inward and Outward DI

Hong Kong’s Census and Statistics Department has issued the statistics of direct investments in country’s economy for the year 2011, where reported the increase of both inward and outward direct investments in Hong Kong economy by the end of 2011.

According to the published statistics, Mainland China remained the largest source and destination of HK direct investments. As the source of investments, at the end of the year Mainland China accounted for 36.3%, being the largest share of the total stock. The Mainland was also the most important destination for Hong Kong’s outward direct investments, with 42.1% share of the total stock by the end of 2011. 

British Virgin Islands was the second largest source of Hong Kong direct investments, with more than prominent share of 31.1%. As a destination of outward investment, the BVI was in the second place with 41.8% - again, very close to the leader of the statistics of HK investments, Mainland China.

In 2011, the stock of HK’s inward DI increased marginally by 0.9% from the year 2010, and achieved market value of almost HKD8.38 trillion. The total stock of Hong Kong’s outward DI increased by 8.3% from the previous year and reached market value of HKD7.95 trillion, with a ratio to GDP of 411%.

BVI Territory Signs TIEA wil Ireland and China

December 7. The British Virgin Islands signed tax information exchange agreement with Ireland. The TIEA is based on a model agreement developed by the OECD, and will allow the British Virgin Islands to send requests to the Revenue Commissioners to obtain and provide information needed in the course of its tax investigations. Also, after this document is signed, the Revenue Commissioners from Ireland may request information from their counterpart in the British Virgin Islands.

The information relevant to Ireland's tax investigation issues in most cases would concern the bank accounts or the beneficial ownership of companies or trusts.

Another TIEA was concluded between the BVI and China, signed by BVI Premier and Minister of Finance, Ralph O’Neal and Chinese Deputy Commissioner of the State Administration of Taxation, Qian Guanlin.

In his statement after signing the agreements, O'Neal remarked that they were a significant milestone in relations between the Governments of the British Virgin Islands, China and Ireland, and expressed the commitment to examine other areas of mutual co-operation and benefit.

Previous TIEA was concluded by the BVI with the Kingdom of Netherlands in September 2009. With signing of these two agreements, total number of tax exchange agreements signed by the BVI Territory reached 17.

BVI Among Top Investors According to Chinese FDI Statistics in 2008

The Ministry of Commerce of China said that the growth of foreign direct investment (FDI) into the Chinese economy fell for the third month of 2009. For the whole year 2008, FDI however grew 23.58 percent and made $92.4 billion (compared to 13.59 percent to $74.8 billion of actually used FDI in 2007), due to the intense growth in the first three quarters of the year.

According to the data reported by the Ministry of Commerce, the major source of FDI for China in year 2008 was Hong Kong, which provided the country with $41 billion for a 48 percent annual increase. The second big FDI source was British Virgin Islands, which invested $15.95 billion. However, the percentage of funds invested by the BVI is just 3.62 - that is less than in 2007, reflecting the general trend.

The level of foreign direct investments from Japan rose 1.76 percent and made $3.65 billion in 2008, followed by South Korea with $3.14 billion (14.76 percent), and the US with $2.94 billion – the rise of 12.54 percent.

The industries which received most of all FDI were banking, insurance and securities, which drew $38.1 billion, or 24.23 percent more than in 2007. Actually, in the past decade China has been one of the biggest FDI recipients, but some experts guess that the global financial crisis could change this trend. For example, Mei Xinyu, a senior researcher with the Ministry of Commerce, said he was not optimistic about this year FDI level. Some experts even say that FDI could fall by 5-10 percent in the first half of the year, but positive turn is also expected – in the second half of 2008.

PRC Remains Most Attractive Destination of FDI, BVI Ranks 2nd Among FDI sources

The Ministry of Commerce of China published figures for actual FDI inflows into the country's economy, totaling $42.78 billion from January to May 2008 – this is a 54.97% increase from the previous year. Only in May, FDI stood at $7.76 billion, that is 37.94 % higher than in the previous year.

According to the information published by the Ministry of Commerce, about 11,915 new overseas-funded enterprises were established in the first five months of this year, that is down 20.95% from the previous year, and in May there were 2,425 new enterprises – down 10.94%.

The top three leading countries in the five months of the year 2008 by the amount of FDI are the same as in the statistical bulletin for the first quarter of the year 2008 – Hong Kong, British Virgin Islands (in the second place), and Singapore.

By the results of this statistical bulletin, as well as according to the Ernst & Young latest survey among business leaders, China is still in the first place among the countries most attractive for foreign direct investments. This survey reflected more equal distribution of global investments across the world, and 41% of respondents still ranked China as the most attractive investment destination, followed by India and Russia. However, China still draws less than 8% of global volume of FDI inflows, according to the information published by the United Nations Commission for Trade and Development.