New Private Trust Company Regulations
Substantive private trust company legislation came into force in January 2007 and the enactment of subsidiary regulations specifying which companies will be exempt followed soon afterwards.
Under the legislation, certain private trust companies may be exempted from licensing requirements and other provisions of the Banks and Trust Companies Act, under procedures implemented by the Financial Services Commission. Unremunerated BVI private trust companies which do not offer their services to the general public will be able to apply for these exemptions, according to the Commission.
"These regulatory changes will enhance the BVI’s attractiveness as a jurisdiction for the incorporation and use of private trust companies," Christopher McKenzie, Partner and head of Walkers’ private client department in the BVI, stated, adding: "These developments are extremely positive news for estate planners and will promote more structures that use both a trust governed by BVI law and a BVI private trust company as trustee by striking the right balance between the level of regulation versus the level of exemption.”
Private trust companies enable family-controlled structures to be established, offer trustees the benefits of limited liability and perpetual existence which are usually the features of corporate vehicles, and can lessen the tax burden by moving the liability from the settlor to the trust company.
The BVI's new trusts legislation has opened up wider markets for the BVI trust, in which clients are not necessarily interested so much just in tax avoidance, but also in the efficient management of wealth in a more general sense.
British Virgin Islands News
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will run a budget surplus during 2010, although the government still intends to review indirect taxes and fees on financial services.