Atrium & Associates (BVI) LTD

British Virgin Islands BVI Funds

Start a Tax-Free Offshore Investment Fund

Advantages of setting up a BVI fund

The British Virgin Islands, often referred to as the BVI, holds a significant position as the second largest global offshore hub for hedge funds. It stands out as a flourishing jurisdiction for the creation of offshore investment funds in general. The BVI distinguishes itself by its versatile approach, offering various regulatory frameworks tailored for smaller to mid-sized hedge fund entities. This adaptability presents an attractive opportunity for investment managers and advisors seeking to establish their presence within the BVI. This is just one of the multitude of benefits that contribute to the BVI's prominent status as a premier choice for offshore hedge fund domicile.

Within the BVI, a diverse array of fund options is available, suitable to cover a range of different investment products and investors.

Notably, mutual funds operating in the BVI fall under regulatory oversight if they pool investor funds to facilitate collective investments, maintain an open-ended structure, and provide equity interests that allow holders to redeem their shares based on their proportional stake in the fund's net assets. Conversely, Closed-end funds are not subject to direct BVI regulation.

Benefits

Hedge funds domiciled in the BVI make up approximately a quarter of all offshore investment funds established worldwide. This popularity is due to a wide range of benefits of registering an investment fund in the BVI, most importantly due to its tax exemptions, stable economic and political jurisdiction and full compliance with governmental bodies.

Moreover, there exist no regulatory limitations concerning investment strategies, nor is there an obligatory mandate to engage local directors, local officials, or local auditors.

Advantages of setting up a BVI fund

Favorable Tax Environment:

The BVI offers a beneficial tax regime with no capital gains tax, corporate income tax, inheritance tax, or value-added tax. This can result in enhanced tax efficiency for the fund and its investors.

Confidentiality and Privacy:

BVI provides a high level of confidentiality, allowing shareholders and directors to remain discreet, safeguarding sensitive financial information.

Flexibility in Structure:

BVI offers various fund structures such as private, professional, and public funds, accommodating diverse investor types and investment strategies.

Streamlined Setup and Operation:

The BVI has a well-established regulatory framework for investment funds, facilitating a relatively straightforward setup process with the support of professional service providers.

Global Reputation:

BVI is internationally recognized as a reputable offshore financial center, which can enhance the fund's credibility and attract a global pool of investors.

Diverse Investment Opportunities:

BVI investment funds can cover a broad range of asset classes including equities, real estate, hedge funds, and private equity, enabling effective portfolio diversification.

Regulatory Efficiency:

While subject to regulation, BVI's regulatory environment is balanced and less cumbersome compared to other jurisdictions, minimizing administrative burdens.

Appealing to International Investors: The BVI's tax advantages and recognition make it appealing to both institutional and individual investors seeking international investment opportunities.

Currency Choices:

BVI funds can be denominated in various currencies, accommodating investor preferences and reducing currency risk.

Political and Legal Stability:

The BVI offers political stability and operates under a well-established legal system based on English common law, providing a secure environment for investments.

It's crucial to note that the benefits of setting up a BVI investment fund should be weighed against your specific goals, investor base, and regulatory considerations to ensure the jurisdiction aligns with your fund's strategy and requirements.

Types of funds

There are a number of BVI fund products suited to everyone from the startup manager setting up an incubator fund to established institutional fund managers with billions under management.

• Incubator Fund
• Approved Fund
• Private Fund
• Professional Fund
• Public Fund

Key Features of BVI Funds

Regulatory Body

In the BVI, Investment funds are regulated by SIBA - Securities and Investment Business Act-

Unregulated Funds

These are the called Closed-ended funds, private equity funds and registered funds (incubator and approved funds)

Common Functionaries

Investment manager, Administrator, Custodian and Auditor are usually the appointed functionaries of the BVI Funds, regulated by SIBA. (NB: for Private or Professional Funds, the Custodian are usually independent from the Manager or Administrator.

Application process

Requests for endorsement as an Incubator Fund or an Approved Fund are submitted to the Commission and should be accompanied by:

• the official constitutional papers;
• comprehensive information about the investment approach;
• a designated template for investor cautionary statements; and
• an application fee amounting to US$1,500.

Upon the Commission's reception of a duly filled application, an Incubator Fund or Approved Fund can officially initiate operations just 48 hours after the submission date.

Duration and conversion of incubator fund

An Incubator Fund takes usually a time frame of two years, with the possibility of extending it by an additional 12 months. In contrast, an Approved Fund is not subject to such temporal restrictions. At the conclusion of its tenure, an Incubator Fund can choose to transform into an Approved Fund, a private fund, or a professional fund, or alternatively, it can opt for winding up. Should an Incubator Fund desire to transition into a private or professional fund or become an Approved Fund, it can initiate the process by submitting an appropriate application to the Commission.

Ongoing obligations

Aligned with the cost-effective ethos of these entities, the prerequisites for service providers are kept to a minimum. Each fund is obligated to designate an authorized representative within the BVI. Additionally, an Approved Fund is required to maintain an administrator at all times. Nevertheless, obligatory custody stipulations are absent from the requirements.

Mandates for the issuance of an offering document are not compulsory. Should a fund opt not to create one, the requisite investor warnings can be presented in a distinct term sheet.

Beyond this, both Incubator Funds and Approved Funds are mandated by regulations to:

• Remit an annual fee amounting to US$1,000 on or before March 31st each year.
• Sustain a minimum of two directors perpetually, with one being an individual.
• Notify the Commission of any modifications to information furnished during the application process. Such changes may encompass the fund's operations, directors, or other significant aspects with potential regulatory impact.
• Prepare and submit annual financial statements to the Commission, devoid of any compulsion for an independent audit.
• Lodge bi-annual returns with the Commission.

Since the Regulations' inception, we have acquired substantial experience in establishing numerous funds of this nature. Anticipations suggest that as prospective managers become acquainted with these structures, they will persist as appealing options for startup managers, family offices, and other entities seeking a streamlined, prompt, and economically viable pathway to establish a lightly regulated investment vehicle.

Our Fund services

Our Business Development Managers will guide you through the whole process to obtaining your fund license and day-to-day management.

Our services include:

• Advice and assistance in setting up your offshore fund
• Ongoing support, from day-to-day administration to assistance with corporate, legal and tax matters
• Fund accounting and valuation
• Risk management and compliance services
• Domiciliation and office rental (if required)
• Audit services

We offer complete solutions for fund administration and support throughout the whole process.

Our one-stop shop approach allows fund sponsors more time to concentrate on asset growth and management. We understand the investment fund industry, and our experience and expertise will help you enhance your fund’s operations and building a secure relationship with your investors and counterparties.

How we can Help You!

Should you have any question or matter you would like to discuss or clarify with us, or Should you like to receive further Information about our services and fees,…

Our multilingual team of business advisors is happy to assist you with all upcoming questions and issues in relation to your application.

You may call or email us, and we will be happy to assist you in a fast and efficient manner.

Contact us today for an initial complimentary consultation and find out how we can help you achieve your investment goals!

Check all further and related information on our website

Our offices Tortola, BVI British Virgin Islands

30 DeCastro Street PO Box 4519,

Road Town, Tortola, VG1110

Phone: + 1 855 289 0134

Email: info.bvi@atrium-bvi.com

Altrincham, European Office

United Kingdom Peel House,

30 The Downs,

Ste 28

Altrincham,

Cheshire, WA14 2PX

Phone: + 44 161 3941189

Email: info.uk@atrium-bvi.com