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Articles

Legal analysis by Harneys lawyers

The global reach of the BVI as an investment funds jurisdiction

Authors:
Publication Date:
17 May 2017



The BVI is recognised globally as a leading funds jurisdiction. It has built up this reputation over the course of many successful decades, based upon the essential building blocks of being tax neutral, politically stable and economically secure. 

Approximately one quarter of all offshore hedge funds established worldwide over the years have been domiciled in the BVI. This impressive record can be credited to its highly regarded legal system based on well-established and recognised English common law principles, its sophisticated yet user-friendly legislation and its ability to keep up with and be fully compliant with all internationally recognised tax reporting and anti-money laundering standards. 

The BVI benefits from a diverse offering of five regulated funds products, which blend together and allow the BVI to be a suitable home for everyone from the start-up manager setting up an incubator fund to an established institutional fund manager with billions under management who may require more of a retail-style platform. In addition, largely as a result of the jurisdiction’s world-class legislation, the BVI is increasingly the domicile of choice for closed-ended vehicles (ie those in the real-estate, private equity and venture capital spaces). Because of the flexibility and sophistication of the relevant legislation, it is also becoming the home for more niche areas such as crypto-currency funds, hybrid funds and crowdfunding platforms.

While the majority of investment funds launched in the BVI are established as corporate entities, two other vehicles are proving increasingly popular: the limited partnership and the segregated portfolio company, a single company limited by shares but offering statutory segregation of assets and liabilities between separate “portfolios”.

Read more about Harneys in the BVI.

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