BVI News

Gov’t approves more $$ to pay legal costs for economic substance legislation

A section of Tortola. (BVI News photo)

Local government has approved more funds for legal costs associated with the economic substance legislation, a post-Cabinet report has said.

The decision was made during a special Cabinet meeting on December 16 last year. However, the report was only made public on Wednesday.

It said: “Cabinet Decided to approve an additional $150,000 to cover additional work on Economic Substance legislation and related matters and approved an additional payment of $114,485.19 to Messrs. Michael Furness and Jack Rivett for additional work completed on the said legislation.”

Government first hired Furness and Rivett in 2018 for them to draft legislation intended to keep the BVI off the European Union’s (EU) blacklist of tax haven jurisdictions.

Since then, they have been made to make multiple amendments to the legislation because of additional requirements from the EU.

The EU’s explanation of economic substance has to do with financial services companies setting up physical and appropriately-staffed office spaces in the territory.

The BVI is just one of several jurisdictions targeted by the EU and just this month, one of the EU’s member countries — France — blacklisted the British Virgin Islands as a non-cooperative territory in tax matters.

Copyright 2020 BVI News, Media Expressions Limited. All Rights Reserved. This material may not be published, broadcast, rewritten or distributed.

5 Comments

Disclaimer: BVI News and its affiliated companies are not responsible for the content of comments posted or for anything arising out of use of the comments below or other interaction among the users.

  1. And says:

    And tell us all how many companies have set up offices and staffed then with locals. The answer is zero!!! This sham you are paying lawyers to keep you off the EU blacklist is not working. Not one company is setting up offices because it’s easier to move their corporation to another jurisdiction. That is why the financial sector is failing. It’s over done and dead. Have the funeral, have your period of mourning and then get a grip!!!

    Like 15
    Dislike 3
    • Haha says:

      Not every company fall under the bracket that requires them to set up shop in the BVI. Plus most Trust companies have implemented new services so that their staff will be the ones representing those clients that do fall under the category so dont expect to see new office buildings. All the money staying right in the Registered Agents which is the smart thing to do. Existing staff can do everything that is required to comply with the law. It’s just a little more expensive for the clients but most can afford to pay. Financial services is all about evolving to beat every law that tries to stifle it’s success.

      Like 12
      • @Haha says:

        Not to argue with you but the intent of the rule is that companies need to open offices and staff them based upon the amount of assets they have. In other words, they are actually supposed to do the business of which they are incorporated. As we all know, these corporations exist to hide money from governments and the attorneys if ex wives. Regardless of the requirements, just the fact that the beneficial ownership is now essentially becoming public will cause all the corporations to part company with the BVI. Thus, once again the financial sector is dead and it’s time it’s acknowledged. Remaining in denial will only compound the effects to the Territory

        Like 5
        Dislike 5
        • Haha says:

          No business is dead when there is a need or want for the service. Every product or service will eventually see a decline but rumors of the demise has been greatly exaggerated.

          Like 5
          Dislike 3
          • Denial says:

            Your one of those in denial. Making beneficial ownership public will make the need for an offshore corporation useless. The intent is to hide from public view. Once exposed it’s over. Say as you wish, the Territories income from the Financial Service sector has declined and will continue to do so.

            Like 1
            Dislike 4

Leave a Comment

Shares