The Act requires certain BVI entities carrying on specified activities to have ‘adequate substance’ in the BVI. The Act applies to “legal entities” carrying on “relevant activities”, other than non-resident companies, non-resident limited partnerships and limited partnerships which have elected not to have legal personality. For additional particulars of the Act, please refer to our eAlert of 2 January 2019.

Since the Act was published, BVI’s legal community has been awaiting the issuance of Government guidance to assist in determining if a particular entity is carrying on a relevant activity and, if so, whether it meets the applicable economic substance requirements (for instance, the definition of ‘adequate’ in the context of each “relevant activity” and in various circumstances).

We are pleased to advise that BVI Finance announced on 29 March 2019 that, with the assistance of external draftsmen, progress is being made with the drafting of the BVI Government’s guidance, termed the Economic Substance Code (the Code). BVI Finance anticipates that the draft Code will be published in late April 2019. This is to be followed immediately by an education campaign in the BVI, followed by a similar campaign in Hong Kong for the Asian market. Publication of the Code in finalised form is expected shortly after the conclusion of these campaigns.

Once the draft Code has been published, we will be in touch with more information about how we expect our client base to be impacted by the legislation, as clarified by the guidance. In the meantime, if you have any questions, please reach out to your usual Appleby contact or a member of the team above.

Key Contacts

Jeffrey Kirk

Managing Partner: BVI

T +1 284 393 5318
E Email Jeffrey

David Clark

Partner: Bermuda, BVI

T +1 441 298 3583
E Email David

Andrew Jowett

Group Partner: BVI, Jersey

T +1 (284) 393 5316
E Email Andrew

Twitter LinkedIn Email Save as PDF
More Publications
27 Sep 2022

Resealing Hong Kong Grants of Probate in the BVI

Once resealed, grants obtained in Hong Kong shall have the same force and effect, and have the same ...

Contributors: Crystal Au-Yeung
27 Sep 2022

Similar but Different

While the basic features of the trust remain, there are some notable differences in how trusts can b...

8 Sep 2022

The ICLG Guide to Fintech 2022: British Virgin Islands Chapter

Appleby has provided the British Virgin Islands chapter to the International Comparative Legal Guide...

28 Apr 2022

Restructuring the offshore debt of Chinese Real Estate Developers

This article sets out how the current regimes in the Cayman Islands and the BVI can assist with rest...

Contributors: Crystal Au-Yeung
28 Apr 2022

Assignment, novation or sub-participation of loans             

Transfers of loan portfolios between lending institutions have always been commonplace in the financ...

17 Mar 2022

Lexology chapter: Private Equity (Transactions) 2022 – British Virgin Islands

The Lexology Private Equity (Transactions): Global overview is an easy-to-use reference guide that p...

Contributors: Stuart Fee
28 Oct 2021

BVI – Protecting Personal Data: Are You Prepared?

The BVI Data Protection Act, 2021 (DPA) came into force on 9 July 2021. Drafted around a set of EU-...

Contributors: Peter Colegate
4 Oct 2021

The Last Rites for the Siskina?

On 4 October 2021, the Judicial Committee of the Privy Council delivered its much anticipated decisi...

Contributors: Eliot Simpson
6 Sep 2021

Lexology chapter: Private Equity (Transactions)

The Lexology Private Equity (Transactions): Global overview is an easy-to-use reference guide that p...

11 Jun 2021

Trust Disputes and the BVI Trustee (Amendment) Act, 2021

In the Trustee (Amendment) Act 2021 (the “Amendment Act”) the BVI legislature has made a number ...

Contributors: Crystal Au-Yeung