Much emphasis is placed on ensuring the accurate use of the name of any BVI company as it conducts its business and quite rightfully so. As with anything else, a company’s name both introduces and identifies it to the world and so the importance of getting that right cannot be overstated.
Though many will likely have more than a passing familiarity with BVI companies, few will probably appreciate the various interesting features that characterise the BVI legal framework governing the names of those companies. A number of those features are highlighted below.
Legal requirements for name
The law prescribes certain requirements for the names of BVI companies. Company names may contain up to 100 characters, including the basic alphanumeric characters and the standard symbols which appear on the QWERTY keyboard (with the exception of currency symbols unless it contains an accent or other diacritical mark, in which case the Registrar has a discretion to permit its use).
Re-use of names
Given there have been over 1 million companies incorporated in the BVI over the years, the recycling of company names seems unavoidable and inevitable. Broadly speaking, the circumstances in which a company name may be re-used are as follows:
- If a company changes its name, another company may use it or a name similar to it (1) if the first company consents and the name change is part of a genuine sale of a business or undertaking or where the companies are part of the same group (2) after three years if the first company consents, or (3) after seven years in any other circumstances
- If a company has changed its name, it may revert to its previous name at any point if the name remains available
- Where the first company is dissolved, the name may be re-used at any time
- Where a company has continued out of the BVI, its name or a name similar to it may be used by another company after seven years has passed
- Where a discontinued company subsequently continues back into the BVI, it may re-use its old name if that name remains available
- The name of an insolvent company (ie a company which is (1) in liquidation or administrative receivership under the BVI insolvency Act, 2003 (the Insolvency Act) or (2) has been dissolved following liquidation or administrative receivership under the Insolvency Act in the preceding two years) or one similar to it may only be re-used where the liquidator or administrative receiver has sold the business of the insolvent company or where the BVI court has approved use of the name
Adoption of foreign character name
Perhaps one of the least known facts about BVI companies is that they can adopt both an English name and a foreign character name and while the majority will adopt only an English name, many adopt both, either at the time of incorporation or at some later point in time.
There is no prescribed list of foreign characters which may be used but many names will represent a translation of the company’s English name although this isn’t strictly necessary. It is open to any company to apply to register a foreign character name with the BVI Registrar of Corporate Affairs (the Registrar) and in the same way in which no two companies can be registered with the same English name, no two companies may register the same foreign character name (or names which are so similar as to mislead or confuse).
Once the foreign character name is registered, the company’s constitutional documents must reflect both names and the company must ensure that its full name (ie both its English name and foreign character name) is clearly stated in all written communication sent by it or on its behalf and every legal document executed by or on behalf of the company (and evidencing or creating a legal obligation for the company). However, it is worth noting that non-compliance won’t render the obligations under the documents invalid or unenforceable but leaves the company vulnerable to sanction and a local fine of US$1,000. Conversely, companies are given the option to include their foreign name on their company seal; they are not obliged to do so.
Similar names by multiple companies
Traditionally, BVI companies have been prohibited from using a name which is so similar to that of another BVI company that it could potentially confuse or mislead. However, this position has been relaxed somewhat in recent years so that the Registrar now has greater flexibility to approve names which would ordinarily be considered too similar when dealing with companies which are affiliated.
Registrar discretion in approving Company Name
On the face of it, the Registrar has an extremely wide discretion when considering whether or not to approve a proposed name and need not take into account the existence of any trade or service mark or other intellectual property right in relation to any proposed company name in making her decision of whether or not to approve a company name.
Many of the features highlighted above have come on stream within the past several years and pay direct testament to the BVI’s commitment to flexibility and to continuously evolving to keep apace with market demand. With this as a guiding philosophy, it seems more likely than not that we will see this area of the law continue to evolve as the needs of the global marketplace do.