Asset Protection in the British Virgin Islands, Think Twice!
On October 27, 2016, the BVI courts rendered an important decision in third party disclosure when a judgment creditor is attempting to gain information from a BVI company’s registered agent. Pursuant to this decision, an order can be served on a BVI company’s registered agent, if a creditor is not successful in enforcing a judgment against a debtor. Therefore, international/foreign creditors, under certain conditions, may seek in the BVI an order against a BVI’s company’s registered agent forcing him/her/it to disclose information on the beneficial owners of the BVI company.
According to the decision, there are 3 factors that must be proven before the BVI courtscan grant an order forcing the company’s registered agent to disclose the requested information:
1. An apparent wrongdoing carried out by the judgment debtor or parties beneficiaries to the company (for instance, when there is a suspicion that a defendant has participated in the willful evasion of the judgment);
2. The judgment creditor needs the order to seek information on the judgment debtor in order to enable action (for instance, when the information could be useful to the creditors to enforce a freezing order brought against the judgment debtor); and
3. The judgment debtor (i) must be “mixed up” in the wrongdoing, and (ii) the registered agent has potential information on the judgment debtor that can facilitate the fulfillment of the order. As such, the requesting party does not necessarily need to show a specific incident of wrongdoing, a mere suspicion will suffice.
In any case, while the decision changes the BVI law, it should be pointed out that even if a judgment creditor fulfills all of the above criteria, not all orders will be granted. In other words, each order will be granted or denied on a case-by-case basis.
If you need assistance, please contact Barbosa Legal to discuss your specific situation, knowing your communications will remain protected under the attorney-client privilege.