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.

Tuesday, December 01, 2020

UK Government Names Conditions for Providing Financial Support to BVI

The UK government has reiterated the conditions under which it is going to provide economic support to its Overseas Territories, including the British Virgin Islands. In the 2020 communique, which was published at the Joint Ministerial Council meeting for OTs, the UK government said it expects Territories to be financially independent as much as possible, as it will only offer financial aid in exceptional circumstances.

The UK government said that while OTs as small and open-island economies vulnerable to external threats, governments must manage public funds to make the economy resilient in times of disasters. It is stated in the communique: “In times of crisis, the UK stands ready to support the Overseas Territories, as happened following the hurricanes in 2017 and during the COVID-19 crisis. As a first step, the UK will look to the Overseas Territories to make full use of their financial resources to address their needs and will consider further requests for financial support on a case-by-case basis.”

The UK government also promised to help OTS increase their economic resilience through technical support and encouraging financial management, and to consult the Overseas Territories on a support programme for next financial year.

The UK pressured the OECD to give the British Virgin Islands loans which it didn’t originally qualify for, by staying as a guarantor for them. However, the BVI government was asked to set up the Recovery Development Agency (RDA) to ensure transparent managing of these funds.

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Saturday, November 07, 2020

BVI Highly Ranked in Vistra Report

In this year’s Vistra 2030 report, which is released every two years by the global corporate services company, the British Virgin Islands ranked highest among offshore financial centres, although it declined when compared to onshore jurisdictions, and achieved a rating of 2.94, down from 3.3 in the previous report in 2018.

The report is based on 620 interviews with industry experts, where they rated the importance of each jurisdiction. This year, forty-three percent of respondents expected offshore centres like the British Virgin Islands to continue declining as a result of reduction in demand for offshore financial services. The jurisdiction lost 1.1 points in this rating, since it was first ranked 10 years ago. 

However, it is noted by Vistra that the BVI has proven to be very resilient: “In the current climate, the BVI’s role as a neutral intermediary cannot be overstated. Clients can swiftly set up new BVI structures that are globally recognised and accepted for international business.. Many such clients are from emerging markets, and it can be helpful for them to use intermediary structures, particularly at a time of international tension.” According to the report, 75 per cent of HK’s Hang Seng Index consists of companies directly linked to the BVI.

The report states that “Jurisdictions such as BVI, Cayman, the Channel Islands and Bermuda will still be thriving 10 years from now.”

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Saturday, October 03, 2020

BVI Government Confirmed its commitment to Public Register of Beneficial Ownership

The government of the British Virgin Islands has approved the commitment to introduce public registers of beneficial ownership for BVI-incorporated companies. Andrew Fahie, the Premier and Minister of Finance of the jurisdiction, informed the House of Assembly that the government would work towards a publicly accessible register of beneficial ownership for companies.

The Premier also emphasized that the progress of this issue would be “in line with international standards and best practices as they develop globally” and would aspire to match the EU’s most recent anti-money-laundering directive. He also said: “In advancing this commitment, we will be informed at all times by global best practice at the time within a timeframe that we consider deliverable.”

According to the Foreign Office Minister for the Overseas Territories and Sustainable Development, the BVI would be adopting public registers by 2023.

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Saturday, September 19, 2020

BVI Re-elected for the Caribbean Development & Cooperation Committee

For the third consecutive two-year term, the British Virgin Islands has been re-elected on the Caribbean Development & Cooperation Committee (CDCC), which is a subsidiary body of the United Nations Economic Commission for Latin America and the Caribbean (ECLAC).

The BVI Premier Andrew Fahie will serve as a Vice-Chair on the board. He commented on this achievement, saying: “I am humbled by our region’s confidence in me, and the BVI as an Associate Member Country of ECLAC, to serve as a Vice-Chair of CDCC during these very challenging times in which we as SIDS (Small Islands Developing States) are all combatting COVID-19, facing an active hurricane season and under intense economic pressure.”

The Premier will also co-chair a proposed Summit of the Associate Members of ECLAC in 2021, where he will discuss the challenges faced by Associate Members, their progress and needed support, to implement the UN 2030 Sustainable Development Agenda that has been impacted by COVID-19 and other developments.

In addition to the BVI, Cuba and Dominica were also elected to serve as Vice-Chairs on the Caribbean Development and Cooperation Committee.

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Monday, February 24, 2020

BVI Appears on EU “White List” of Jurisdictions

The British Virgin Islands became one of 16 countries placed on EU white list, which was revealed in the last weeks of February. The jurisdiction was whitelisted partially due to economic substance legislation enacted at the end of 2018, which allowed the BVI to be placed on the EU’s “Annex II” of jurisdictions with “pending commitments.” The deadline extensions were granted to give time to the British Virgin Islands to pass the needed reforms to fully comply with co-operation standards. Thus, the country avoided being placed on “Annex I” (the blacklist).

BVI Premier Andrew Fahie welcomed the decision of the European Union, having said in his statement: “This is as a result of close cooperation and positive dialogue with the EU and demonstrates the BVI’s commitment to meeting and surpassing international standards.” He also added that he and his government “remain completely focused on ensuring the continued success of our international business and finance centre and its role in the global economy. We believe there will be significant opportunity for our territory and our people as we enhance our economic substance yet further.”

The 16 new whitelisted jurisdictions, along with the Virgin Islands, are Antigua and Barbuda, Armenia, the Bahamas, Barbados, Belize, Bermuda, Cabo Verde, Cook Islands, Curaçao, Marshall Islands, Montenegro, Nauru, Niue, St. Kitts and Nevis and Vietnam.

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Thursday, January 16, 2020

BVI FSC Issued Q3 2019 Statistical Bulletin

The British Virgin Islands Financial Services Commission has published the fifty-fifth volume of Quarterly Statistical Bulletin, where provided important information on different sectors of the financial services industry on the Territory for the third quarter of 2019.

According to the statistics on the Registry of Corporate Affairs, there were 6,975 new incorporations in the reported period, which is an increase of 9.58% as compared to 6,365 Business Companies registered in Q2 2019 and a decrease of 27.15% as compared to 9,575 new BC’s in Q3 2018. As at September 30, 2019, total cumulative number of Business Companies in the British Virgin Islands was 402,234

In the three months ended September 30, 2019, 48 new Limited Partnerships were formed, which is a 29.73% increase as compared to the second quarter when 37 LP’s were incorporated, and a 57.89% decrease compared to 114 new Limited Partnerships registered in the third quarter of 2018. Cumulatively there were 927 Active Limited Partnerships in BVI as at 30 September 2019.

As to the information by the Intellectual Property Unit within the Registry of Corporate Affairs, total number of new applications to register a Trademark for Q3 2019 increased to 89, from 75 in Q2 2019. In Q3 2018, there were 69 applications. For the total year 2018, 225 Trademark applications were filed, compared to 221 application for the first three quarters of 2019. Also, in Q3 2019 two patents were re-registered in the Office of Trade Marks, Patents and Copyright (0 in Q2 2019, 4 in Q3 2018). 

The Quarterly Statistical Bulletin of the BVI FSC also includes information from Banking, Insolvency and Fiduciary Services, including Balance sheet for all commercial banks, which showed the small reduction of the banking sector’s total asset size, which is approximately $2.34 billion this quarter (4% less than in Q2 2019). Further statistics covers the Financial and Money Services, Fiduciary Services, Insolvency Services, Investment Business and Insurance departments, as well as Enforcement, Ongoing Supervision and International Co-operation matters.

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Monday, December 23, 2019

BVI Premier Announces Revenue from Financial Services to Drop off

When addressing the House of Assembly during the budget debate, BVI Premier and Minister for Finance Andrew Fahie has said the British Virgin Islands’ revenues from the financial services sector dropped off by roughly US$30 million. He also said he had to put several projects on hold, including those in the health services, because he knew that this drop off would happen.

Meanwhile, the financial services sector was expected to see boom this year, which could be the result of the EU insisting that the territory implement the Economic Substance (Companies and Limited Partnerships) Act which makes it mandatory for offshore financial services companies to be physically present in the BVI territory. This Act was passed to remove the BVI from the EU blacklist on non-compliant jurisdictions. By words of the Director of International Business Neil Smith, due to opening physical offices the number of companies in the jurisdiction would have been reduced, but the number of persons involved in the industry was likely to triple.

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Monday, December 16, 2019

2020 Budget Passed by the House of Assembly

Last week, the House of Assembly successfully passed the budget for the year 2020 with amendments. According to BVI Premier and Finance Minister, Hon. Andrew Fahie, this was the first time in many years when the budget was approved from the first time. He stated, however, that there are some challenges ahead for the BVI.

In his budget speech last month, Hon. Fahie announced a projected revenue of US$414 million, while the recurrent expenditure is set to be US$327 million. Capital expenditure is expected to be US$65 million, with US$6 million to be contributed to the funds. Also, US$14 million are planned to be used by the BVI Government for principle repayment on debt

The Premier also mentioned the two major economic pillars of the jurisdiction, financial services and tourism, and the challenges that should be met in these sectors. No new taxes were announced for 2020.

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Monday, December 02, 2019

Digicel Announced the Appointment of New CEO

Digicel British Virgin Islands announced the appointment of the new Chief Executive Officer (CEO). Kevin Smith, who performed the duties of Commercial and Operations Director for Digicel from 2013 to 2015, as well as worked as Managing Director of New Direction Business Consulting and held other senior posts at the BVI Post Office and Citco BVI Limited, came back to continue his work in the mobile operator.

Smith has 25 years of experience in commercial and management positions across government and non-government organisations in the British Virgin Islands. His recent role was Chief Operating Officer of the Telecoms Regulatory Commission in July 2018. 

Digicel’s Group CEO Jean-Yves Charlier congratulated Smith on his appointment to lead Digicel BVI having said in his comments: “Along with his strong grasp of the Digicel DNA based on his previous experience with us, he brings the right mix of commercial and customer understanding coupled with a deep passion for technology and development which can only be of benefit to our customers in the BVI.”

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Tuesday, November 19, 2019

BVI Invest Agency to be Created in the British Virgin Islands

Junior Minister for Trade and Economic Development announced the launch of an investment promotions agency, which will work to attract foreign investment to the BVI territory. The agency called BVI Invest will be included in the Caribbean Association of Investment Promotion Agencies (CAIPA), a network of similar governmental departments across the region.

The establishment of the new agency was announced during a 5-day course held in the British Virgin Islands to train regional governments on methodologies for investment project formulation and appraisal, technical assistance, networking and making use of investment practices. The course was held in co-operation with CAIPA and the United Nations Industrial Development Organisation, and is focused on international accepted methodologies. 

Also, Minister was talking about the BVI efforts to diversify and digitise its economy and the need for investment in human resources. She said that the software would help the BVI to compute financial statements needed to appraise investment projects and their possible economic benefit to the BVI territory.

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Saturday, November 09, 2019

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.

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Friday, November 01, 2019

Final Economic Substance Requirements Issued by BVI International Tax Authority

The BVI International Tax Authority has finalized the regime of new economic substance rules. The new rules, effective from the beginning of 2019, are included in the Economic Substance (Companies and Limited Partnership) Act, 2018.

According to the new requirements, which are effective in the large part of the European Union, and which have been supported by OECD BEPS Inclusive Framework members, the companies tax resident in a low or no tax jurisdiction and engaged in key activities identified by the EU, in order to access the tax regimes of the territory are obliged to meet minimum substance requirements as part of their annual tax return

In some business sectors, activities generating income must be primarily conducted with qualified employees and operating expenditure in the jurisdiction. Among the main activities identified by the European Commission Code of Conduct Group there are banking, insurance, financing and leasing, fund management, shipping, intellectual property, and holding companies whose income is generated from any of the above activities.

For each of the core activities standards vary to reflect the different needs of the companies involved, and are to ensure that there are sufficient activities undertaken in the relevant jurisdiction to reflect the amount of profits accounted there. The substance requirements will include being able to demonstrate that the company is directed and managed from the relevant jurisdiction, has physical office and sufficient level of employees and annual expenditure.

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Friday, October 18, 2019

Bank of Asia (BVI) Started Full Online Operations

Bank of Asia (BVI) Limited started full operations in September 2019, and is actively accepting clients. Its customers can complete the account application procedure online through their website. Now customers can establish their accounts by following instructions, and even upload certified documents 24/7. Banking services are provided online through digital platform.

Bank of Asia is one of the first fully digital global banks and the first bank in BVI to be licensed in more than 20 years. It has built its platform with the latest technologies, reducing transaction time and expense. The bank focuses of various types of deposits, including saving deposits, current deposits, time deposits, and remittance services. Prepaid cards and debit cards are expected to be introduced by the Bank. 

Chairman and Founder of Bank of Asia commented: “FinTech is the future. The British Virgin Islands, which is the world’s leading offshore jurisdiction, is home to Bank of Asia. We are proud to be the first bank to be licensed by the BVI in more than two decades and we are offering smart financial and lifestyle services to customers using innovative technology, products and better customer service globally.”

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Friday, October 11, 2019

Cabinet Approved Establishment of Borrowing Committee

The BVI Cabinet approved the establishment of Borrowing Committee consisting of eight members and chaired by the Financial Secretary, to secure all funding under the UK Loan Guarantee on behalf of the government. In the last Cabinet post-meeting statement it was said: “The Borrowing Committee will be the sole entity authorised by the Cabinet of the Virgin Islands in collaboration with the Ministry of Finance to source and negotiate loans under the ‘Guarantee’, pursuant to the implementation of the revised Recovery to Development Plan.”

The newly established Committee will review the terms and conditions of loans offered by lending institutions to government, and the borrowing presented by the Minister of Finance Andrew Fahie. The panel will recommend to the Finance Minister all amendments to the loans offered under the Guarantee as well as other borrowings falling under specified stipulations; they will also recommend the most appropriate loans to the Cabinet

The Borrowing Committee will be mainly guided by the Virgin Islands Public Finance Management Act and is expected to include the Financial Secretary as Chairman, Permanent Secretary in the Premier’s Office, the Attorney General, a nominee by the Opposition Leader, a nominee representing the Business Community, an External Regional Leader, a representative from the BVI Banking Association and a Secretary from the Premier’s Office.

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Tuesday, September 24, 2019

BVI Financial Management Agreement with UK Considered to be Amended

BVI Premier Andrew Fahie said that it is possible that borrowing restrictions placed on the territory in the Protocols for Effective Financial Management agreement between the BVI and the UK could be waived in case the BVI territory suffers from major natural disaster or catastrophe. The financial agreement, which was signed in 2012 and is currently in force, prohibits the BVI government from borrowing more than 80 per cent of its recurring revenue, but the UK is prepared to consider this through a “natural disaster clause”.

Andrew Fahie noted that making provisions in the agreement for disasters was one of of the things the BVI wanted to discuss, during recent negotiations with the UK about its loan guarantee offer. The Premier commented on the raised concerns: “The UK government stated to us that it is prepared to consider including a reference to natural disasters and catastrophic events in the debt section of the Protocols for Effective Financial Management.” 

In his speech addressing members of the media, Premier Fahie said that, based on the territory’s geographical location, the BVI is not only susceptible to hurricanes, but also to other disasters such as earthquakes, and in case they impact the territory to a high degree, the BVI might need to borrow extensively to rebuild, like in case of hurricanes Irma and Maria.

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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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