Legislation in the British Virgin Islands and in the Cayman Islands requires certain entities that are incorporated or registered in those jurisdictions and which conduct one or more of a set list of relevant activities to comply with local substance requirements known as ‘economic substance’.
The following specifically defined activities are considered relevant activities and relevant entities must comply with the economic substance rules in the relevant jurisdiction:
- Banking business
- Insurance business
- Shipping business
- Fund management business
- Financing and leasing business
- Headquarters business
- Holding company business
- Intellectual property business
- Distribution and service centre business
In order to help our clients to determine whether or not they are required to comply with economic substance requirements, we work closely with the lawyers at Harneys (our affiliated law firm), who have created the BVI Economic Substance Classification Solution designed to deliver clients a classification and tailored legal advice, based on the users input, in an interactive questionnaire format. This innovative solution is provided at a flat fee and is accessible through an online platform which the user can access at their convenience.
If you would like to get started on your entity classification please click HERE.
For clients that do need to establish and demonstrate substance in the British Virgin Islands or in the Cayman Islands we are perfectly positioned to provide bespoke and integrated legal and administrative solutions. We provide a full suite of governance, resident director and accounting services, and can work with you to obtain trade licences, work permits, premises, specialist equipment, or dedicated human resources.
If you believe that you manage or own an entity that may be affected by substance rules based on the nature of its operations, please contact one of the key contacts below.