Knowledge

The purpose of this briefing is to summarise the process to transfer a BVI company into another jurisdiction by way of continuation.

It is a general summary of the law and does not constitute legal advice. If you have any questions about transfers by way of continuation, please contact your usual Bedell Cristin contact.

Introduction

The BVI Business Companies Act (Revised) (the "Act") allows a BVI company to continue as a company incorporated under the laws of another jurisdiction.

Conditions for continuation out

The following conditions must be satisfied for a BVI company to continue out:

• it is in good standing;
• its memorandum or articles of association do not restrict a continuation out;
• subject to its memorandum or articles, the continuation out must be approved by board or member resolution; and
• it has filed with the Registrar of Corporate Affairs:
  • a notice of intention to continue out, including a declaration that it has, at least 14 days before filing the notice:
    • advertised such intention, including the new jurisdiction, in the BVI Gazette and on its website; and
    • notified its members and creditors in writing; and
  • a declaration confirming that the laws of the new jurisdiction:
    • permit the continuation of the company; and
    • have been complied with.

Application process

The company's registered agent will file with the Registrar a notice of discontinuance, and if satisfied that the requirements of the Act have been complied with, it will:

• issue a certificate of discontinuance;
• strike the name of the company off the Register of Companies; and
• publish the striking off in the BVI Gazette.

Where required by the law of the new jurisdiction, the Registrar may issue a certificate confirming that (i) the company in good standing, and (ii) that it may continue out under BVI law.

Where the company has a registered security interest

Where the company has a charge registered in respect of its property that has not been released or satisfied, and that does not contain a covenant prohibiting a continuation out, there is an additional condition for a continuation out.  That is, it must provide a written declaration to the Registrar stating that:

• notice of satisfaction or release in respect of the charge has been filed;
• if no such notice has been filed, the chargee has been notified in writing of the intention to continue out and it has consented or not objected; or
• where the chargee has not given its consent or it has objected, the chargee's interest secured by the charge shall not be diminished or compromised by the continuation out.

Effect of continuation out

The effect of a transfer by way of continuation out of BVI (and into the new jurisdiction) is that the company continues in existence throughout.  In particular:

• a company that transfers to another jurisdiction by way of continuation remains liable for all of its claims, debts, liabilities and obligations that existed prior to its continuation out;
• no conviction, judgement, ruling, order, claim, debt, liability or obligation due or to become due, and no cause against the company or any member, director, officer or agent of it, is released or impaired by the company's continuation out; and
• further, any proceedings by or against the company, its members, directors, officers, and agents are not affected by the continuation out.