BVI IMMOBILIZES BEARER SHARES
Legislators have enacted a Bill that will provide for the immobilization of Bearer
Shares, effective December 31st, 2004.
The International Business Companies (Amendment) Act, 2003 had its Second and Third
Readings during the Eleventh Sitting of the Second Session of the Fourteenth
Legislative Council of the Virgin Islands on Thursday 17th April 2003.
“We’re amending a bill that in part the fortunes of the country was built on,” said
Chief Minister and Minister of Finance the Honourable Ralph T. O’Neal as he moved
the bill. He said government had consultations with the private sector.
According to the Chief Minister, with the immobilization of Bearer Shares, all
International Business Companies (IBC’s) will be required to establish and maintain
a Register of Directors and appoint the first Director within 30 days of the
incorporation of the company. Bearer Shares are represented by a certificate that
states that the bearer is the owner of the share.
“A new section of the principal act prohibits authorized custodians from
transferring bearer shares to anyone other than an authorized custodian…and also for
a compulsory Register of Directors,” Chief Minister O’Neal explained.
During debate, Opposition Leader Dr. the Hon. Orlando Smith noted that financial
services has for several years been one of the twin pillars of the BVI economy. He
pointed out that it has however come under considerable strain.
He commended the industry officials who “fight strong to ensure that we maintain a
position in this market…this bill is the Financial Services Commission's decision on
how to deal with bearer shares; we have full confidence in committee and will
support its activities.”
At Large Opposition Member Hon. Ronnie Skelton raised the question about whether the
territory was sending a message to officials in the financial services industry that
government was “taking legislation and just pushing it down their throats.” He said
he hopes it does not seem that the Legislature is passing this bill hurriedly
without giving the industry the proper time to submit their comments.
Another opposition Member, Dr. the Hon. Kedrick Pickering raised the question about
the possible fallout from the introduction of this bill. “How is it going to affect
Attorney General Hon. Cherno Jallow explained that this bill had been lingering for
some time. He said the BVI has had “a lot of battles to fight as to why it still
maintains this regime…with the BVI being the premier jurisdiction for the
incorporation of IBC’s.”
The AG said the BVI continues to undergo one review after the other and is due to
undergo another assessment by the Caribbean Financial Action Task Force (CFATF)
later this year. He said in the last CFATF assessment, this was one of the issues
debated. “So it is critical from an international dimension…it’s a difficult
situation, but once on the statute books, we will be in a better position to answer
the critics and in credible manner…It is not a subject where everyone can agree, but
we’re trying to do the best balancing act we can.”
2003 by SUN ENTERPRISES (B.V.I.) LTD.
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