BVI Voluntary Liquidations: Key End-of-Year Dates and Deadlines
The end of the year is on the horizon and with it come the usual administrative preparations for those Companies that have reached the end of their life cycle and wish to voluntarily liquidate. Companies incorporated in the British Virgin Islands (“BVI”) should commence their liquidation process shortly in order to avoid additional regulatory costs, save money and end their ongoing administrative burden.
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The BVI voluntary liquidation process for companies that are at the end of or nearing their life cycle does not have to be complicated. With some simple steps and considerations, businesses can achieve considerable cost savings when winding down a company that is at its natural endpoint, as well as alleviate any unnecessary administrative burdens.
What are the deadlines for a BVI voluntary liquidation?
BVI companies undertaking a straightforward voluntary liquidation that require a dissolution date prior to 31 December 2023 should ideally commence liquidation by 15 November 2023.
Companies that have assets remaining may need more time to complete any final distributions to the shareholders.
Economic Substance considerations for liquidating companies
Liquidating companies are expected to file an Economic Substance report with the BVI International Tax Authority up to the date of the dissolution of the Company (in so far as practicable). Currently this final report has to be filed manually. Our liquidations team can assist with this process as part of our engagement.
Who can be appointed as a BVI voluntary liquidator?
Amendments in 2023 to the BVI Business Companies Act have introduced important requirements for BVI voluntary liquidations, including a new rule stipulating that at least one of the voluntary liquidators appointed by a BVI company (following 1 January 2023) must be resident in the BVI. In cases of joint voluntary liquidators, the BVI residency requirement only applies to one member of the team. This amendment does not apply to voluntary liquidators appointed on, or before, 31 December 2022.
The amendments also introduced new guidelines for the qualifications of BVI voluntary liquidators: at least two years of liquidation experience and professional competency in liquidations, as well as an insolvency practitioner’s licence issued by the BVI Financial Services Commission or an appropriate similar professional qualification. Under the 1 January 2023 amendments, voluntary liquidators must collect records kept and maintained by the BVI company and at the conclusion of the liquidation, send copies to the BVI company’s former registered agent.
What are the benefits of a BVI voluntary liquidation?
Leveraging our specialised legal and fiduciary and fund services teams, the Maples Group provides clients with comprehensive restructuring and liquidation services, including a team comprised of dedicated individuals with extensive experience who can act as voluntary liquidators to BVI companies. For a straightforward, no assets / no liabilities voluntary liquidation of a BVI company, we can generally complete the process within six to eight weeks.
The Maples Group has a dedicated Voluntary Liquidations team based in the BVI to meet all compliance requirements for corporate dissolution and liquidation in the jurisdiction. The global Liquidations group works with the best practices for statutory processes across our follow-the-sun international network, providing that the wind down of any entity will be completed with objectivity and in keeping with local procedures.
For further information on the team and our liquidation services, please view our brochure on our Liquidations and Dissolutions Services. Liquidation is a natural part of the business life cycle. Please do not hesitate to get in touch with our specialist team who can guide you through this process.