British Virgin Islands (BVI) Economic Substance
In response to the European Union (EU)’s Economic Substance legislation, the BVI has since late 2018 taken concrete action to show commitment towards substance compliance. One of such efforts is the Economic Substance (Companies and Limited Partnership) Act, 2018, which was gazetted on 19 December 2018 and came into force on 1 January 2019.
With the landmark date of 30 June 2019, the substance legislation becomes applicable to all BVI companies that existed prior to 1 January 2019, while all other companies formed on or after 1 January 2019 will have to make efforts to comply with substance requirements and demonstrate good corporate governance as soon as possible.
BVI Economic Substance legislation timeline
| Date | Development |
| 5 Dec 2017 | European Union (EU) releases list of non-cooperative tax jurisdictions, commonly known as the EU ‘Blacklist’ and ‘Greylist’ |
| 19 Dec 2018 | The Economic Substance (Companies & Limited Partnership) Act, 2018 released in the BVI Gazette |
| 1 Jan 2019 | The Economic Substance (Companies & Limited Partnership) Act, 2018 officially in force |
| 22 Apr 2019 | Draft Economic code published |
| 17 May 2019 | European Union (EU) removes Aruba, Barbados, Dominica and Bermuda from the ‘Blacklist’. The BVI remain on the ‘Greylist’ for further observation. |
| 28 Jun 2019 | Statutory Instrument 2019, No. 41, Economic Substance (companies & Limited Partnership) Act, 2018 published, final code release delayed |
| 30 Jun 2019 | All existing BVI entities now within scope of substance legislation and must start demonstrating substance compliance |
| 1 Oct 2019 | (Expected) Final Economic Substance code published |
Vistra’s services and solutions
- BVI Economic Substance Classification Questionnaire
The BVI Economic Substance Classification Questionnaire aims to help clients determine the classification of their BVI company as it applies to the substance legislation. In order to know if your company is fully compliant with the Economic Substance (Companies and Limited Partnerships) Act (“the Act”), it is crucial to determine whether or not it is within the scope of the legislation, which depends on a range of factors, such as your company’s tax residence, activities and other aspects of its business model.
The Classification Questionnaire is designed specifically to help you assess your BVI entities’ status in the most convenient and effective manner, as well as to gain a better understanding of what further action you should consider taking in order to ensure full compliance with the substance legislation.
Find out more about why you should classify with Vistra here.
In addition, we also a wide range of substance services to help clients navigate the complexity of substance compliance, such as legal opinion, in-scope advisory, remediation support, as well as in-jurisdiction substance solutions. Contact us at [email protected] to find out more.
Contact us
To find out more about how Vistra can help your BVI entity ensure substance compliance, please reach out to your Account Manager or regular Vistra contact, or any of our in-country representatives here.
Alternatively, you can make an enquiry by clicking the button below, and our teams will get back to you shortly:
Our insights
Private equity firms often make this costly mistake with SPVs: Here's how to avoid it
24 Apr 2024
A special purpose vehicle, or SPV, in private equity is a distinct legal entity created for a specific financial purpose, such as holding assets, managing risks, or facilitating deals or acquisitions. SPVs are commonly used to separate financial…
People with significant control in the UK: Frequently asked questions
10 Apr 2024
UK companies and limited liability partnerships must create and maintain a register of people with significant control, or PSCs. This is a register of people who have influence or control over a company or partnership…
Private equity firms often make this costly mistake with SPVs: Here's how to avoid it
24 Apr 2024
A special purpose vehicle, or SPV, in private equity is a distinct legal entity created for a specific financial purpose, such as holding assets, managing risks, or facilitating deals or acquisitions. SPVs are commonly used to separate financial…
People with significant control in the UK: Frequently asked questions
10 Apr 2024
UK companies and limited liability partnerships must create and maintain a register of people with significant control, or PSCs. This is a register of people who have influence or control over a company or partnership…
Rexella Hodge
Managing Director, Corporate & Private Clients, Vistra BVI
British Virgin Islands
