British Virgin Islands Funds License

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British Virgin Islands Funds License

Brief Overview: In the Virgin Islands, the Mutual Funds Act, 1996, governs mutual funds’ investments under the administration of the British Virgin Islands Financial Services Commission. The Act which controls regulates and authorize, open-ended funds, also provide the guidelines for registration of managers and administrators doing business in the territory.

Types of BVI funds;

    BVI Private

Key features;

  • no more than fifty investors or
  • Invitation to subscribe for, or purchase fund interests issued by the fund shall be made on a private basis only.
  • Private fund cannot commence business until recognized by the Commission.

    BVI Professional fund

A professional fund is one which shares are only issued to “professional investors” and the initial investment of each investor in the fund (other than “exempted investors”) shall not be less than USD 100,000 or its equivalent in any other currency for all investors other than exempted investors.

    BVI public fund

A public fund is a mutual fund whose offering of fund interests may be made to a large number of investors or to persons other than experienced investors

Mandatory Publication of prospectus approved by and signed on behalf of the fund’s directors.

    BVI Incubator funds

The incubator fund is designed for managers who are looking to start an investment strategy on a trial basis with sophisticated investors:

  • Only suitable for “sophisticated private investors”. Such investors are defined in the Regulations as “a person who has been invited to invest in an incubator fund and the amount of his or her initial investment is not less than US$20,000.”
  • The total number of investors is limited to 20.
  • Net assets of the fund must not exceed US$20,000,000 or its equivalent in any other currency.
  • No manager, administrator or custodian is required to be appointed.
  • No audit required.
  • Can only be approved for a two year period with extension option of 12 months

    BVI Approved funds

The approved fund is designed for smaller strategies and friends and family funds and has a higher net asset value threshold and no limit to the length of time if may qualify as an approved fund.  It also differs from the incubator fund in requiring an administrator.

Key features;

  • The total number of investors is limited to 20.
  • Net assets of the fund must not exceed US$100,000,000 or its equivalent in any other currency.
  • The approved fund must have an administrator, but it is not required to have a manager or custodian.
  • No audit require

    BVI Approved manager

Approved Manager may act as the investment manager or investment advisor to any number of private or professional funds recognized under SIBA (including funds domiciled outside of the BVI), as well as any number of closed ended funds domiciled in the BVI which have the key characteristics of a private or professional fund.

An Approved Manager can also act for non‐BVI feeder funds into BVI master funds. The key restriction is that aggregate assets under management of all of the open ended funds cannot exceed USD400 million and that the capital commitments of all of the closed ended funds cannot exceed USD1 billion.