While the smaller offshore domiciles have remained static, the BVI continues to add notable numbers to its captive community. Including the 59 credit life companies, the BVI captive count is now over 140. Group captives, in particular, are proving increasingly popular.
Since the introduction of the pioneering International Business Companies Act in 1984, the BVI has developed into a leading offshore financial services centre, with some 300,000 non-resident companies registered. Many blue-chip international service firms have been attracted. The domicile regularly undertakes programmes to expand its financial services offerings to meet the needs of international financial markets. In line with BVI tradition, such programmes are developed in close consultation with the private sector.
Among the advantages offered by the BVI are: British Dependent Territory status; political and economic stability; US dollar currency; a legal system based on English law; and freedom from restrictions and over-regulation. BVI literature adds that: “firms can draw on state of the art telecommunications, infrastructure and support services, and on a well trained management and workforce. The BVI enjoys one of the world's highest literacy rates, at 98%, and has developed a wide range of specialised programmes to train its people in financial services skills.”
In terms of captive incorporation, there are various benefits to consider. The capitalisation requirement is not onerous ($100,000 for general business, $200,000 for long term, and $300,000 for both), and general fees and costs (including those charged by professional advisers) compare favourably with other captive domiciles. Indeed, costs are such that even reasonably small captives are able to operate as a single unit on an economical basis. Since most BVI captives are incorporated as international business companies, they enjoy tax exempt status and there is no requirement for local directors to hold board meetings in the BVI which can result in considerable savings in both cost and time.
“Quality service and vigilance” is the domicile's motto and it is no empty promise. The last ten years have seen the BVI build a reputation for being scrupulous in its regulation, innovative in its legislation, responsive in its relationship with the business community, and conscientious in the delivery of high quality service. For example, while insurance legislation ensures a large degree of flexibility in captive business plans, prudent supervision is guaranteed.
The BVI regards this reputation as its most important single asset and is very protective of it. In addition, the domicile is resolute in its efforts to prevent and combat commercial crime, providing appropriate gateways for justifiable disclosures of information to assist regulatory and law enforcement agencies in the investigation of criminal activities.
This has been written into law and incorporated in the BVI's Insurance Act, Bank & Trust Companies Act and Company Management Act.This does not mean, however, that tax information will be exchanged with any tax authority, inside or outside the BVI, or that “fishing expeditions” by any external authority will be tolerated.
Because of the domicile's integrity, flexibility and and responsiveness to the interests of the financial community, it has become the only Caribbean Overseas Territory to which the British Government has devolved responsibility for developing and managing its own financial services industry.