Micro Business Companies Act, 2017

Summary

This Act creates a new, simplified BVI corporate vehicle called the 'micro business company' (MBC), intended for very small businesses. An MBC is a company limited by shares that is incorporated, managed and dissolved under a lighter-touch regime than a standard BVI Business Company, with a single natural-person 'principal' who runs the company and up to a small number of natural-person 'participants' holding non-transferable participant shares.

• Incorporation and structure: MBCs can only be incorporated via application filed by a proposed registered agent; a principal share is automatically issued to the principal on registration, and the principal is obligated to direct and manage the company.
• Registered agent: Only a person approved by the Commission under the Banks and Trust Companies Act, 1990 or Company Management Act, 1990 may act as registered agent for an MBC, and must consent to and file the incorporation/transformation application.
• Shares and shareholders: No share certificates are issued; the principal share is transferable but cannot be encumbered, held on trust or jointly held, and participant shares are non-transferable and similarly restricted.
• Annual and interim returns: Principals/MBCs must file an annual return and, where applicable, an interim return in the approved form (sections 64 and 65).
• Transformation: An MBC may elect to transform into a BVI business company, and a BVI business company may transform into an MBC if it meets specified conditions (e.g. eligible activities, licensing, principal/participant limits, qualified registered agent); a BVI business company that wishes to transform must do so within 9 months of the Act's commencement.
• Liquidation, striking off and dissolution: The Act sets out a distinct voluntary liquidation regime for MBCs, including declarations of solvency, appointment and duties of voluntary liquidators, and procedures for striking off, dissolution and restoration.
• Investigations, fees and offences: The Registrar/Commission may order investigations of MBCs, prescribe fees and penalties payable to the Registrar, and the Act creates offences and penalties for non-compliance.
• Tax treatment: MBCs and their shareholders benefit from exemptions from tax as set out in section 118, subject to foreign tax obligations under section 119.

The Act does not commence on a fixed date in the text provided; it comes into operation on a date to be appointed by the Minister by Notice in the Gazette. Detailed procedural requirements for annual/interim returns, fees, and record-keeping are set out in later sections and schedules not fully reproduced here.

Key obligations

• A person incorporating a micro business company must file the application, including required charter information and the registered agent's consent, and only the proposed registered agent may file that application
• On registration, the principal is obligated to direct and manage the business affairs of the micro business company
• The registered agent for a micro business company must be a person approved under the Banks and Trust Companies Act, 1990 or the Company Management Act, 1990 to act in that capacity
• A micro business company must file an annual return in the approved form in accordance with section 64
• A micro business company must file an interim return in the approved form where required under section 65, in addition to the annual return
• Principal shares must not be encumbered, held on trust, held as nominee, or jointly held, and participant shares must not be transferred, disposed of, encumbered, held on trust or jointly held
• A BVI business company wishing to transform into a micro business company must file a request with the Registrar via a qualified registered agent, meeting the eligibility conditions in Schedule provisions (including principal/participant limits and licensing requirements)
• A BVI business company that wishes to transform into a micro business company must do so within 9 months from the date the Act comes into force, after which the Registrar will not permit such transformation
• Fees and penalties prescribed under the Act must be paid to the Registrar, including annual fees due by the date fixed under section 113

Applies to

micro business companies, principals (natural individual shareholders), participants (natural individual shareholders), registered agents (approved under the Banks and Trust Companies Act, 1990 or Company Management Act, 1990), BVI business companies (transforming to or from micro business company status)

Deadlines

• such date as the Minister may, by Notice published in the Gazette, appoint: Commencement date of the Micro Business Companies Act, 2017
• 9 months from the date of coming into force of this Act: Period within which a BVI business company wishing to transform into a micro business company must do so, after which the Registrar will not permit the transformation