BVI Among Major Foreign Investors in Nepal in 2012/2013

According to the Department of Industry of Nepal, the amount of Foreign Direct Investment (FDI) in the economy of the country increased by 163% in year 2012/2013, as compared to the previous fiscal year. In 2012/2013, 275 joint venture companies were registered in the country. They have committed to make investment of Rs 18.84 billion, while in 2011/2012 FDI commitment was Rs 7.14 billion.

British Virgin Islands is at the top of the list of countries investing in Nepal, in terms of commitment amount, with investment commitment of Rs 4.49 billion. The BVI is followed by Hong Kong with investment commitment of Rs 3.07 billion, and India with as much as Rs 2.45 billion. In terms of number of companies, China is on the leading position with 87 joint ventures, followed by India. Most of FDI from China and Hong Kong are in the sector of hydropower projects and infrastructure development.

Brian Obvi,
Offshore Analyst

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BVI Hosted Meeting of Task Force on Trade and Investment

On May 30-31, 2013, the seventh meeting of the EU Overseas Countries and Territories (OCT) Task Force on Trade and Investment was organized in the British Virgin Islands with participation of Caribbean Export Development Agency as chair of the CARIFORUM, and French Caribbean Outermost Region (FCOR). During these two days, the members of the task force were examining key developments that have taken place in 2010-2012 and have related to the CARIFORUM-EU relationship, including an update on the CARIFORUM-EU partnership strategy, deliberations in the CARIFORUM-EU EPA institutions and an update on EDF programming.

The EU Overseas Countries and Territories (OCT) Task Force on Trade and Investment is promoting dialogue on issues related to trade and investment, and assisting with the projects between CARIFORUM states and the French Caribbean region, which is part to the European Partnership Agreement through its political status with the French Republic.

At the opening of the Trade and Investment task force meeting, BVI Premier Dr Orlando Smith said: “Although BVI has only observer status in the organisation we are proud to be part of a forward moving process and congratulate the region for being able to move forward with the European Partnership Agreements (EPA) with the European Union (EU).”

Brian Obvi,
Offshore Analyst

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Premier Smith Hosting Chairman of OCTA Organisation

The chairman of the Overseas Countries and Territories Association and president of the Territorial Council of St Pierre and Miquelon Stéphane Artano visited the territory of the British Virgin Islands, as part of the regional familiarisation mission to the Caribbean countries as the OCTA chairman. This visit to the BVI will help to enhance its relationship with the overseas countries and territories of the European Union (OCT-EU).

Premier of the British Virgin Islands Dr Orlando Smith, who hosted OCTA chairman, will assume the chairmanship of OCTA in December 2013. During his visit to the BVI, Artano had the purpose to personally familiarise himself with the BVI, as well as to inform Smith of his green growth agenda for the OCTs. Also, the director of the International Affairs Secretariat, Sylvia Moses, informed that “the OCTA chairman would like to discuss Premier Smith’s views on the revision of the Overseas Association Decision (OAD) and its programming regulations; the OCT regional funding envelope; and regional programming under the 11th European Development Fund.” 

According to Sylvia Moses, the talks between the premier of the BVI and OCTA chairman were to focus on innovation in economic and environmental policies for all overseas territories. Moses said that Artano will address common issues and interests among OCTs, including tourism, fisheries and the internet communications.

The British Virgin Islands is vice president of OCTA organisation, as well as the co-chair of the OCTA/EU Financial Services Partnership Working Party that brings together technical experts from the EU and OCTs to discuss financial services related matters.

Brian Obvi,
Offshore Analyst

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BVI Delegation Visited Business Conferences in Dubai

In March, the British Virgin Islands delegation visited the two conferences in Dubai, with the purpose to discuss potential co-operation in the sphere of financial services, and attract funds and business to the BVI.

The Hedge Funds World Conference at the Jumeirah Beach Hotel in Dubai and the Society of Trust and Estate Practioners' "Opportunities for the Flow of New Wealth Conference" were organized to discuss business and investment possibilities in Dubai, particularly from tax-free Dubai International Financial Center.

Elise Donovan, the Executive Director of the BVI International Finance Center, commented on the events: “We were given a very warm welcome on our return to the United Arab Emirates and it is clear that many investors from across the region recognize the advantages of using BVI structures and services for conducting international business.”

She also said that the British Virgin Islands is an “attractive option to investors from the Gulf States looking to acquire BVI company structures for a multiplicity of investing and other cross-border transactions. BVI’s structures are easy to use, flexible, widely accepted and cost-competitive compared to other products being offered in the region."

Brian Obvi,
Offshore Analyst

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Commonwealth Workshop Organized for OECS Countries

A workshop for the OECS countries takes place on 4-8 March 2013 in St Lucia, hosted by the Commonwealth Secretariat and the Organisation of Eastern Caribbean States. The activity targets Anguilla, Antigua and Barbuda, the British Virgin Islands, Dominica, Grenada, St Kitts and Nevis, St Lucia, St Vincent and the Grenadines and the OECS Secretariat, and aims to enhance the capacity of the jurisdictions to develop, implement and monitor effective national and regional trade policies and boost participation in regional and international trade negotiations.

The representatives of the countries participating in the training include senior officials responsible for trade policy, statistics and trade negotiations. It is funded by the Commonwealth Secretariat, which is a key development partner of the region.  

Veniana Qalo, economic advisor at the Commonwealth Secretariat, said that during the workshop a Commonwealth guide for small states negotiators is to be presented, highlighting successful approaches that can be used to help these capacity constrained economies to leverage successful outcomes, despite their size.

Brian Obvi,
Offshore Analyst

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BVI Premier Speaks on the Development of Financial Services Industry

The Premier and Minister for Finance of the British Virgin Islands Orlando Smith had discussed the future of the BVI as a financial centre with business leaders. He said that the BVI government has the aim to strengthen the position of the territory as a leading offshore financial centre that adheres to international standards, and to set the BVI apart from its competitors by developing innovative new offerings.

The Premier and Minister for Finance noted that the BVI, which once had unique position in the world of financial services, now has a community of competitors in this niche, as well as in tourism sector. He said that the territory must “rise to the challenges of keeping the twin pillars of economy not only sturdy but resilient.” By words of the Premier, the BVI should review its business models, and to improve or increase the products offered, because what once was an “extraordinary idea,” has now become “the new normal.”

Orlando Smith pointed to changing international standards on tax transparency and information exchange. He stressed that the BVI government must increase its efforts to inform the international community on all the steps taken by the jurisdiction to adopt leading international standards and improve co-operation with tax authorities of other countries. Also, he said that particularly close attention should be focused on the “correctly themed marketing of our tourism and financial services products, and currently efforts are fully underway to rebrand the BVI product."

To boost the ties of the BVI territory with emerging markets, particularly Asian, the BVI government plans to establish a representative office in Hong Kong.

Brian Obvi,
Offshore Analyst

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New Volume of Statistical Bulletin Issued by BVI FSC

This week, the Commission published the twenty-eighth volume of its Quarterly Statistical Bulletin, comprising statistics and analysis of BVI financial services industry for the third quarter of 2012. In the three month period, ended September 2012, 16,251 new companies and 20 limited partnerships were incorporated on the territory – more than in the second quarter of the year. As compared to the previous years, the number of company incorporations in the third quarter of 2012 was less than in the same quarter of 2011 (17,056), but more than in the years 2010 and 2009 (15,946 and 13,368, respectively). According to the Registry of Corporate Affairs, cumulative number of active business companies achieved 473,707 as at 30 September 2012, and cumulative number of limited partnerships achieved 496.

By the Banking and Fiduciary Services statistics, banking sector of the British Virgin Islands showed the following figures in the third quarter of 2012 (in thousands of US$): Cash items in the amount of $689,815, loans and advances in the amount of $1,600,974, total assets - $2,438,154, total shareholders’ equity - $449,670, net income - $31,235.

In the Investment Business, 3 new Investment Business licenses and 29 Mutual Funds licenses were granted in the reported period. Cumulative number of active mutual funds in Q3 2012 was 157 public funds (181 in Q3 2011), 591 private funds (718 in Q3 2011), and 1,610 professional funds (1,728 in Q3 2011).

In the sector of Legal and Enforcement and International Cooperation, 51 enforcement matters were registered in the reported period, and 31 formal requests for international cooperation, requiring the disclosure of non-public information. There were 14 enforcement actions, 12 of them – before the Enforcement Committee. Among the matters referred to the Licensing and Supervisory Committee in the third quarter of 2012, 79 related to Banking and Fiduciary Services, 332 related to Investment Business, 46 – to Insurance, and 7 – to Insolvency Services.

Brian Obvi,
Offshore Analyst

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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%.

Brian Obvi,
Offshore Analyst

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BVI Premier Announced New Budget Format and Fiscal Strategies

In his 2013 Budget Address to the BVI territory, the Premier and Minister of Finance Dr Orlando Smith named the increase of revenue from tourism, increased market share in the financial services industry, and renewed activity in the other components of the economy as the main factors for achieving positive economic growth in the British Virgin Islands.

The Premier explained that this budget is made over a rolling three-year period, for the first time in the history of the British Virgin Islands. This method will assist the government in the planning for a longer term, and allow for the better management. The new budget format is built upon a new chart of accounts that is based on the International Monetary Fund’s government finance statistics (GFS) format. 

The fundamental principles of the government’s fiscal strategy include: increasing the recurrent budget surplus over the medium term through the enhancement of the revenue stream, a reduction in recurrent revenue growth, reducing the fiscal deficit by 2015, meeting the borrowing limit ratios stated in the protocols for effective financial management, and enhancing the financial management structure and practices within the government.

Brian Obvi,
Offshore Analyst

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BVI Adopt New Laws on Aicraft Registration

New laws to support the expansion of the aircraft registry of the British Virgin Islands entered into force, enabling locally-registered operators to secure aircraft financing. New pieces of the BVI legislation, named the Mortgaging of Aircraft and Aircraft Engines Act, 2011, and the Mortgaging of Aircraft and Aircraft Engines Regulations, 2012, allow aircraft operators to register their ownership in the jurisdictions under three separate registries – for aircraft, their engines, and their mortgages. This will give to aircraft operators the opportunity to receive financing from lending institutions, which require that legal ownership should be demonstrated before providing financing.

The British Virgin Islands has been known as tax-efficient jurisdiction for aircraft holding companies, and in the last year the government launched the development of the local Aircraft Register. The BVI government expects that, with the new legislation, the jurisdiction will be able to use its position as a holding company domicile to encourage international operators to register their aircraft and engines in the BVI. 

According to Harney’s law firm, the new legislation, and especially its development providing for the filing of priority notices for credit institutions “paves the way for new business opportunities which complement and support the British Virgin Islands’ position as the premier offshore corporate domicile with over 850,000 companies incorporated to date.”

Brian Obvi,
Offshore Analyst

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BVI and Grenada arrange for leadership summit

The Premier of the British Virgin Islands Dr Orlando Smith, and the Prime Minister of Grenada Tillman Thomas will co-host a summit of political and business leaders of the Caribbean region, which will be held in May 2013, on Necker Island, BVI. The summit will bring together leaders from ten Caribbean islands, as well as leaders of global private sector. It is expected also that at the end of the summit a government leaders declaration will be signed.

Last week, summit organizer Sheldon Cohen, director of external affairs, Caribbean Program, of The Nature Conservancy, visited Grenada to have a meeting with environment officials in order to make preliminary arrangements. Probably, as a result of Grenada’s participation in the summit, significant financial resources are to be used to conserve the coastal and marine environment and to support such sectors as tourism and fisheries.

Brian Obvi,
Offshore Analyst

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UK Receives Feedback on BVI and Other Overseas Territories

The UK government received feedback as part of its consultation on the review of its relationship with country's overseas territories, including BVI and other Caribbean territories. It was stated that the government should support its Overseas Territories to develop sustainable economic models, and provide assistance to ensure good governance by local governments.

One of the most often named challenges that interfere with economic development in the British Overseas Territories was the need for the diversification of jurisdictions' economies. Economic diversification was raised by various respondents to the consultation.

According to the official submission of the Premier of the British Virgin Islands, the contraction of tourism and financial services has had “multiplier effects across all sectors of the society”. This issue was also raised in the official response by the government of the Cayman Islands.

The respondents also said that transparency, poor planning and corruption were the most prominent issues in relation to good governance and stated that the UK could assist with solving these problems by providing audits and advice to local authorities. This issue was raised by residents of the British Virgin Islands, the Cayman Islands and Montserrat.

Brian Obvi,
Offshore Analyst

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Premier Speaking on BVI Tourist Board Activities

BVI Premier and Minister for Finance having responsibility for the tourism sector, Hon. Dr. D. Orlando Smith, said that the first one hundred days have been an intense listening period for members of newly appointed BVI Tourist Board.

The Premier said that in the very beginning of the year the Tourist Board organized a formal Tourism Stakeholders consultation to get information from the tourism industry on a number of topics ranging from the “BVI Brand” to infrastructural development, marketing collaboration, investment in new and existing product offerings and how the Board could be more responsive to stakeholders. Subsequent to that meeting, the Tourist Board have been in contact with the airlines, ferry operators, with the Dive Association, and other organizations. Hon. Orlando Smith stated that the consultations will continue in order to find workable solutions to attract visitors to the British Virgin Islands.

According to the Premier, the BVI Tourist Board continues its partnership with the International Finance Centre and Shipping Registry, concentrating on obtaining the benefits of synergy in brand and target markets.

Brian Obvi,
Offshore Analyst

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Harneys Launches Textbook on BVI Law

On February 15, Harneys law firm launched the publication of 'British Virgin Islands Commercial Law', which is the first textbook that focuses exclusively on BVI law and practice. This event was attended by the representatives of business and legal community.

Governor McCleary and Premier and Minister for Finance Dr. D. Orlando Smith congratulated Harneys on the book's publication and talked on the significance of such a publication about the British Virgin Islands which depends on financial services industry. By words of Premier Smith, Harneys for several decades has been a committed company in the British Virgin Islands.

The textbook is written by Harneys lawyers and published by leading legal publisher, Sweet and Maxwell. It includes chapters on Company Law, Credit and Security, Law of Property, Financial Services Law, Investment Funds, Insolvency Law, Dispute Resolution and Trusts.

In January, the firm celebrated the publication of the new textbook in Hong Kong where it held legal seminar and interactive session on recent legal developments in the BVI jurisdiction.

Brian Obvi,
Offshore Analyst

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BVI Government Plans to Concentrate on Financial Services and Tourism

Premier and Minister of Finance Dr. D. Orlando Smith has said in his New Year's message on Facebook that in developing the economy of the British Virgin Islands there would be two major traditional pillars – tourism and financial services. He added that the BVI government “will also focus on supporting our small businesses because keeping them afloat is critical to our economic well-being.”

Premier Smith also spoke about the challenges which are to be responded this year: “We have challenges ahead but with those challenges come new opportunities for us to break away from old ways of thinking and forge new paths for ourselves as a people and as a territory.”

Brian Obvi,
Offshore Analyst

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BVI FSC Publishes Financial Statistics for Q2 and Q3 of the Year

Last week, the BVI Financial Services Commission published the twenty-third and twenty-fourth volumes of its Quarterly Statistical Bulletin, providing information on financial services activities in the territory in the second quarter and the third quarter of 2011, respectively.

In the second quarter period, ended 30 June 2011, there were 15,689 business companies newly registered in the BVI, as compared to 12,815 in the same quarter of 2010. Also, there were 13 Limited Partnerships registered in the second quarter of the year. According to the Banking and Fiduciary Services statistics for commercial banks, in this period total assets were US$2,419 mln, cash items were US$717,028 mln, loans and advances were US$$1,529 mln, total liabilities were about US$2 mln.

Total number of Licensed Insolvency Practitioners, including Full and Restricted Licenses, in the second quarter of 2011 was 25. In the sphere of Legal and International Cooperation, there were 24 International Cooperation Matters, and 44 Enforcement Matters. The Licensing and Supervisory Committee (LSC) in these three months has reviewed 538 matters.

The twenty-fourth volume of the BVI Financial Services Commission's Quarterly Statistical Bulletin, providing information on financial services activities in the third quarter of 2011, informs about 17,056 business companies incorporated in this period. Cumulative number of business companies as at 30 September 2011 was 457,331. In the third quarter of 2011, 12 Limited Partnerships were established, cumulative number of Limited Partnerships was 545.

According to the Banking and Fiduciary Services statistics, total assets in this period were US$$2,450 mln, cash items were US$724,6 mln, loans and advances were US$1,582 mln, total liabilities were US$2,028 mln.

According to Legal and International Cooperation Statistics, in the third quarter of 2011 there were 38 International Cooperation Matters, and 31 Enforcement Matters; 357 matters were reviewed by the Licensing and Supervisory Committee.

Brian Obvi,
Offshore Analyst

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International Law Firm Opens Offices in BVI and Singapore

International financial services provider Bedell Trust has announced plans to open new offices in the British Virgin Islands and Singapore. After this, in addition to continuing to service its European-based clients out of Jersey, company's British Virgin Islands legal team, based at Bedell Cristin Jersey, will establish physical presence both in the BVI and Singapore. The BVI law team will also closely co-operate with the Channel Islands offices in providing multi-jurisdictional financial services solutions to customers from Asia.

Bedell Trust will also form an affiliation with an established BVI corporate management services company to support the provision of BVI corporate services to its clients. The company announced that the developments "are central to the Bedell strategy to provide multi-jurisdictional legal and fiduciary services in the key locations where our international client base demands them”.

Brian Obvi,
Offshore Analyst

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BVI Ranked First in the Region for Best Quality of Life

In a report which was recently released by FDI Intelligence, a division of the Financial Times of London, the British Virgin Islands was ranked in the top first place in the list of countries of the Caribbean and Central America.

The report was published based on data compiled by the division of the Financial Times ans scored by an independent judging panel. Judging criteria for the category, which the BVI was the first, was based on multiple factors including life expectancy, infant mortality, unemployment rate, GDP per capita, crime and secondary enrollment rate.

Neil Blyden, chairman of the British Virgin Islands Tourist Board, said in his comments on the BVI ranking: "We are pleased to receive this recognition and we look forward to sharing these wonderful attributes with visitors to the destination... From our pristine beaches and exhilarating natural attractions to our friendly people, award-winning cuisine and outstanding accommodations, the BVI is a destination made for such superlatives."

Brian Obvi,
Offshore Analyst

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BVI FSC Issues Quarterly Statistical Bulletin

The British Virgin Islands Financial Services Commission has issued regular volume of Quarterly Statistical Bulletin, providing information on financial services activities in the jurisdiction in the first quarter of 2011.

According to the information published by the Registry of Corporate Affairs, in the reported period 19,010 Business companies were registered, a significant increase as compared to 14,267 companies registered in the fourth quarter of 2010, and to 16,596 companies registered in the first quarter of 2010. In fact, the number of companies registered in the reported period approached the level of the year 2008, when in Q1 20,752 companies were registered. Cumulative number of Business companies incorporated in the British Virgin Islands by the end of Q1 2011 was 456,146. Also, in the period that ended March 31, 2011, 25 new Limited Partnerships were registered, cumulative number of Limited Partnerships by the end of Q1 2011 was 521.

By the statistics of Banking and Fiduciary Services sector, in the first quarter of 2011 two Class I trusts licences were issued. Cumulatively, there were 223 currently licensed entities as at March 31, 2011.

The statistics of Banking Sector for commercial banks showed the following figures: total assets were US$2,408 mln, cash items were US$729,2, loans and advances made US$1,538 mln, total liabilities were US$2,011 mln.

According to the Investment business statistics, 57 mutual funds were registered in Q1 2011; of them 45 are professional funds and 12 are private funds. Cumulative number of mutual funds as of March 31, 2011 was 2673. The Investment business statistics has also shown that 90 mutual funds licences and 8 Investment business licences were cancelled.

In the Insurance industry, one licence was granted in Q1 2011, cumulative number of insurance and functionaries licences as at 31 March 2011 was 41. In the sphere of Legal and International co-operation there were 35 International Co-operation Matters, 32 of them were formal requests requiring disclosure of the non-public information.

In the first quarter period, there were 452 matters before the Licensing and Supervisory Committee, and one matter of on-site inspection.

Other statistical data, facts and figures can be found on the site of Financial Services Commission of the British Virgin Islands.

Brian Obvi,
Offshore Analyst

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BVI Premier Discusses Dormant Accounts with BVI Bank Association

The government of the British Virgin Islands continues its consultations on the proposed dormant accounts bill, which has already had its first reading in the House of Assembly of the British Virgin Islands on April 19, 2011.

On June 3, 2011, Premier and Minister of Finance Hon. Ralph T.O'Neal, OBE and Financial Secretary Mr. Neil Smith had a meeting and discussion on this matter with the members of the British Virgin Islands (BVI) Bank Association.

The Bill titled “Dormant Accounts Act, 2011” is aimed to provide a framework by which unclaimed assets are ceded to and managed by the Government of the British Virgin Islands. It will also include protocols for the management of accounts and will clearly outline procedures for the claimants.

Brian Obvi,
Offshore Analyst

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