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	Untitled Document International Focus Gibraltar – Online Edition Edition 2 Consequences of the BVI IBC repeals With the repeal of the International Business Companies Act of 1984 in its entirety on 1^st January 2007, this issue of Jordans International Focus Online will consider the position of the “former” International Business Companies that were automatically re-registered to Business Company status on 1^st January 2007 and the consequences on those companies that were not in goodstanding at that time. Relevant sections of the British Virgin Islands Business Companies Act 2006 (BVIBC Act) are cited. All International Business Companies in goodstanding on 31^st December 2006 are now deemed to have been re-registered by the Registrar of Corporate Affairs (Registrar) with effect from 1^st January 2007 (s248 (4) (1)). The Registrar will issue a unique company number and enter the company onto the Register as soon as is practicable but there is no obligation for the Registrar to issue a new certificate of incorporation (s 248 (5) (1)). In practice, the Registrar will allot the same “unique” number as that of the former IBC. Local “Cap 285” companies have an extension until 1^st January 2008, when they too will be automatically converted. A new certificate of incorporation will be available upon application. The certificate will refer to the fact that the company was re-registered automatically. Upon re-registration, the Memorandum and Articles of Association will be deemed to have been amended to the extent required to comply with the Act (248 (4) (6)). It would be desirable to amend the constitution to conform with the new act, but this is not obligatory. Resolutions to amend the constitution may be passed by the members, and generally the directors, but it is prudent to check the Memorandum before passing a directors resolution to ensure that the directors do have this authority. The process of re-registration has no impact on the identity, assets or any proceedings against a company (s248 (6) (1)). The BVIBC Act tackles the issue of bearer shares by removing powers to issue such shares unless specific provisions exist within the constitution of the company. Where a company elects to provide for bearer shares (regardless of whether shares have actually been issued to bearer) the annual fee increases to $1100.00 (in addition to an equivalent increase on the formation fee). Bearer warrants must be held by a regulated custodian under strict control and terms set out at sections 67-77 of the BVIBC Act. Those companies with the ability to issue bearer shares, which have been automatically re-registered will enjoy transitional provisions deferring the increase in licence fee until January 2008, when an interim increase of $250.00 will apply, and the full increase becoming effective from 31^st December 2010. Where bearer warrants are in issue, and the company automatically converted, the custodial obligations will apply from 31^st December 2010. IBC’s not in goodstanding on 31^st December 2006 IBC’s that were not in goodstanding at 31^st December 2006 have automatically been moved across to the BVIBC register, but remain in default. Reinstatement of such companies is therefore now governed by the BVIBC Act and entails a specific application and payment of a fee of $375.00 increasing to $775.00 in cases where the company has been struck off for over six months. In addition, outstanding licence fees and penalties must be remitted to the Registrar at the current rates. The penalties remain at 10% where a company has been struck from the Register for up to two months from the payment due date and 50% thereafter. Registered agents are also likely to levy a charge for handling the reinstatement. Where a reinstated IBC has the provision to issue bearer shares, the increased licence fees and custodial provisions apply immediately. For further information on the consequences of the IBC repeal or to arrange an appointment to discuss your exact requirements please contact Evia Soussi on + 350 75446 or email: evia_soussi@jordans-gib.com. Jordans Limited Jordans has traditionally served the local professional community with both Gibraltar and foreign registered companies. Our local Gibraltar office offers a bespoke incorporation package to local practitioners and this typically includes the preparation and filing of full post incorporation documentation to ensure that the company is fully operational upon delivery. Jordans (Caribbean) Limited was established in Tortola, BVI in 1999 and provides full incorporation and management services from the Caribbean. Jordans (Seychelles) Limited was established in Mahé, Seychelles in 2007 and incorporates both Seychelles IBC and CSL companies. Both facilities enable our Gibraltar Office to offer fast and cost effective local services.

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