BVI News

Save our locals: Regular businesses getting trapped in broad financial services net

By Davion Smith, BVI News Staff

A concern has been raised that regular local businesses such as construction companies are now becoming directly affected by the crippling regulations that international superpowers like the European Union (EU) are imposing on the BVI’s financial services industry.

According to opposition legislator Julian Fraser, these everyday local businesses are being dragged into the financial services fiasco because their owners made one critical decision: they registered their respective businesses as an ‘incorporated company’.

An incorporated company (a legal entity) acts as a separate entity from the business owner and protects owners from liabilities they might incur from running the business.

But, since EU-mandated laws such as the Economic Substance (Companies and Limited Partnerships) Act cannot differentiate between a regular local business and an offshore financial services company, both business types are subjected to the same regulations and restrictions.

Create separate categories for local and foreign companies

This does not spell well for the local business community and, for this reason, Fraser is calling on the next elected government to implement a policy that distinguishes a local business from an offshore company in financial services.

“I want anyone in this House [of Assembly], including myself, who will be resurfacing as the leader of this territory to take note that one of the first order of business is to revisit these issues of legislation and the system itself that have these conditions that are going to affect our local companies unfairly.”

In specifying the types companies that he said are being unfairly affected, Fraser said: “I am talking about the [average] guys who own the shoe stores and the gas stations that have been encouraged to incorporate his business because of liability purposes. However, because we have one category of companies, they are subjected to the same rules and regulations and all these onerous restrictions that are being placed on them.”

Over-regulation now the detriment of BVI

Another legislator Andrew Fahie also raised concern about the issue in the recently-dissolved House of Assembly.

He said: “I am concerned … that we are overregulating the industry to the detriment of our people because it is clear that we’re only going to be able to save a certain percentage of this industry.”

Although the policies being imposed on the BVI are predicted to have unfavourable impacts on the territory’s main revenue-generator — the financial services sector — local legislators have remained compliant so as to avoid diplomatic sanctions from superpowers such as the EU.

The EU and even the United Kingdom has often claimed that the BVI is a tax haven. And, as such, they have embarked on what can be described as a witchhunt on the BVI in a bid to prevent financial crimes such as money laundering and tax evasion.

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

8 Comments

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  1. Anonymous says:

    If one’s neighbour’s dog continue to bite one causing undue suffering and pain every chance it gets, one has two choices, (1) kill the dog or (2) move, separate one’s self to a new location.

    n this case, the BVI can either separate itself from external unwarranted pseudo legal economic sanctions, or it can remain a subservient colony and take what is dished out to it.

    The choices are starkly clear. Take control of ones own destiny or someone else will determine it foe one.

    Determinantly, those decisions may or will not be in ones destiny or interest, but one will have no say or choice in those decisions affecting one.

    When will one shed the mentality of subordination and become dominant of one’s own interest?

    Like 3
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    • Anonymous says:

      Get over yourselves. The exposure of offshore companies does nothing to corporations in the BVI. A construction company that is incorporated has offices, employes people and the owner of the company/corporation will be known. That is in total compliance with the EU. Now if a politician has an offshore company that he has been stuffing full of kickbacks then it’s a problem. These are the corporations that your local politicians are concerned about not a valid business. Stop the BS. The Territories politicians are all corrupt.

      Like 14
      Dislike 1
  2. Seus says:

    Did any member of the NDP receive a kickback, payola, or finders fee from the 7.2m? Was this funneled through a BVI company who now has to disclose their beneficial owners?
    Is that what this is about?
    Our Premier said “no one got rich over the $7.2m” he gave to that airline. Significantly, he didn’t say that no in his party received any payola. But did he divide up the finders fee with all the former members of the NDP. Who got our money? Did a lot of people get a little bit of our 7.2 or did some big fish get a big portion?

    Like 10
    Dislike 1
  3. true says:

    Correct, we are in the process of dissolving our LTD due to a stack load of forms that now need filling out due to these new regulations.

  4. Albion says:

    What is sad is that most of the time politicians don’t know or care what the impact of these regulations are. They are just wilfully ignorant about the offshore industry that is the mainstay of our economy.

    But the moment it starts to have the tiniest impact outside of the financial sector – all of a sudden they jump up and down like they actually know something.

  5. Frazer says:

    Can we find out who destroyed the TPP documents , where the 7m airlines money is? When the incinerator will be fixed, when the roads will be repaired? Let’s talk about real issues!

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