Valsen Fiduciaries Funds

BVI Public Fund

The BVI Financial Services Commission (FSC) regulates mutual funds under the segregated portfolio companies (mutual funds) (amendment) regulations, 2018. This Act sets out the guidelines pertaining to the application and licensing of mutual funds in the BVI.

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About BVI Public Fund

A public fund is a BVI open-ended fund that offers its investment shares to the general public and therefore attracts the highest degree of regulation. A public fund is unable to commence business until such time as it registered with the Financial Service Commission (FSC). Public Funds are divided into “ordinary” mutual funds sold to the general public and “selective” mutual funds sold on a selective basis through intermediaries.

BVI Public Fund Legal Requirements

Requirements Description
  1. Applicable legislation

Mutual Funds Act, 2010

Securities and Investment Business Act 2010 (SIBA)

  1. Supervising Authority

BVI Financial Services Commission (FSC)

  1. Corporate vehicle permitted

BVI Business Company

BVI Segregated Portfolio Company

BVI Unit Trust

BVI Limited Partnership

  1. Share capital or equivalent
  • Minimum subscription

None

  • Minimum investors

None

  1. Directors / Partners / Trustees
  • Minimum number

2

  • Corporate Directors / Partners / Trustees allowed

Only Individual Directors allowed.

For a trust, Trustee must be a body Corporate.

  • Local Directors / Partners / Trustees required

Yes

  1. Fund functionaries required
  1. Custodian
  • Custodian required
No
  • Local custodian required

No

  • Eligible custodian

Yes

  1. Fund manager / Investment manager
  • Fund manager required
Yes
  • Local fund manager required

No

  • Fund manager requires to be licensed

Yes

  • Eligible fund manager

Any other person that is a Body corporate as the authority may approve who is independent of the fund custodian or administrator

  1. Fund administrator
  • Fund administrator required
Yes
  • Local fund administrator required

No

  • Eligible fund administrator

Any other person that is a body corporate as the authority may approve who is independent of the fund manager or custodian

  1. External auditor
  • External auditor required
Yes
  • Local external auditor required

No

  • Eligible external auditor

Foreign or local auditor satisfying conditions as may be prescribed by the Commission.

  1. Asset Requirements
  • Restriction on type of asset class invested

None

  • Asset diversification requirements

None

  • Limitation on size of the fund or total assets under management

None

  1. Local physical office required

No

  1. Prospectus / Offering Memorandum required to be filed

Yes

  1. Eligible for listing

Yes

  1. License fees
  • License application fee

USD 350

  • Annual license fee

USD 350

  1. Estimated license processing duration

3 months

Ongoing Obligations

Requirements Description
Monthly obligations
None
Quarterly obligations
None
Annual obligations
Submit annual audited accounts to FSA within 6 months of the financial year end.
Other obligations

Written notice shall be given to the Commission within seven days after:

  • a director ceases to hold office with a public fund; or
  • a functionary ceases to act for a public fund
Tax Obligations and Other Exemptions
Requirements Description
Business Tax
None. There is no income, capital gains, profit or other forms of direct taxation on corporations, regardless residence status.
Withholding Tax
No withholding tax is payable on dividends and/or interest payable.
Value Added Tax (VAT)
VAT is not applicable to mutual funds in its entirety.
Payroll Tax

Payroll Tax is charged on actual remuneration paid, given or assessed by any employer or self-employed person, to every employee and deemed employee, plus any benefits derived by the employee, deemed employee or self-employed person as a result of his/her employment, whether paid in cash or kind. Payroll tax rates are as follows:

  • The Class 1 employer and the class 1 self-employed person pay at a rate of 10% of the tax base.
  • The Class 2 employer and the class 2 self-employed person pay at a rate of 14% of the tax base. Effective 2007 employment income up to USD 10,000 is tax free.
Stamp duty Act
Instruments to which stamp duty would typically apply include share transfers, charges over and transfers of real estate. The amount of stamp duty payable on a particular instrument will depend on the nature of the instrument.
Trades Tax Act
None
Immovable Property Transfer Restriction Act
None
Immigration Decree
None
Exchange Control Act
There are no foreign exchange control restrictions
Foreign Earnings Act
None

Benefits of a BVI Public Fund:

  • Ease and speed of establishment
  • Flexible structuring of the entity
  • Favourable compliance restrictions
  • Friendly regulatory environment