The Securities and Investment Business Act 2010, which came into force on 31 December last year, requires BVI-domiciled firms which conduct investment related business, whether within or outside of the BVI, to be regulated by its financial regulator, the Financial Services Commission (FSC).
International Adviser understands many international IFA firms are currently domiciled in the BVI and it had been feared that the new legislation could force many to re-domicile.
However, Simon Schilder, who is head of the investment practice international law firm Ogier’s BVI office and a member of the board looking after the ongoing progress of SIBA, said this has not happened and that the legislation could in fact be a positive for the British territory.
“The actual process of gaining a licence from the FSC is not going to be too arduous for most IFA firms as the majority of what it entails is simply showing that you are a properly run organisation,” said Schilder.
“I have personally only advised on six firms who have re-domiciled and these were investment managers dealing with high net worth individuals. All of these companies moved to the Cayman Islands, which introduced its own version of SIBA last year, as the regulations around those who deal with high net worth clients is slightly looser there.”
Schilder said the cost of gaining a licence should also not be prohibitive at only $1,000 for the application and $1,600 annually.
“This is a positive change and something which is in tune with the evolving regulatory environment,” added Schilder.
“Having this sort of regulation in place on the BVI is actually very important for the BVI to continue to be seen as an acceptable jurisdiction for people doing business.”