Trustee Act (Revised Edition 2020)

Summary

This is the BVI Trustee Act, the core statute governing the creation, administration and powers of trusts and trustees in the Virgin Islands. It sets out trustees' investment and management powers, procedures for appointing, retiring and removing trustesse, the powers of the Court over trusts, rules on perpetuities and accumulations, and special regimes for purpose trusts and charitable trusts.

• Investments: Gives trustees a general power to invest trust funds as a prudent person would with their own money, subject to the trust instrument, and protects trustees who retain investments that later become unauthorised.
• General powers: Confers powers to sell, postpone sale, insure trust property, give receipts, delegate during absence abroad, employ agents, and apply income for maintenance or advancement of beneficiaries.
• Appointment and discharge of trustees: Sets rules on the number of trustees, appointment of new or additional trustees, retirement without replacement, and vesting of trust property in continuing or new trustees.
• Court powers: Empowers the Court to appoint new trustees, authorise remuneration, make vesting orders over land, stocks and charity property, vary trusts, and relieve trustees from personal liability for breach of trust.
• Perpetuities and accumulations: Sets a permitted perpetuity period and rules addressing remoteness of vesting, class-closing, and accumulation of income.
• Special and third-party provisions: Addresses proper law of trusts, purpose trusts, protectors and managing/successor trustees, tax and registration exemptions, trust duty, and protections for third parties dealing with trustees.
• Charities: Provides for cy-pres application of charitable property and Court authorisation of dealings with charity property and capital.
• Record-keeping: Requires every trustee to maintain trust records and underlying documentation, wherever located, sufficient to explain the trust's transactions and determine its financial position, and to retain them for at least five years; failure without lawful excuse is a criminal offence.

The Act applies broadly to anyone acting as a trustee, personal representative, protector, settlor or beneficiary under BVI trust law, and to trust companies administering trusts. Most provisions are enabling default rules that can be varied by the trust instrument, but the trust records requirement in section 2A is a mandatory, continuing statutory obligation backed by criminal penalties.

Key obligations

• Every trustee must maintain records and underlying documentation of the trust, whether held within or outside the Virgin Islands, sufficient to show and explain the trust's transactions and to enable its financial position to be determined with reasonable accuracy (section 2A(1)-(3)).
• Every trustee must retain trust records and underlying documentation for a period of at least five years (section 2A(1)).
• A trustee who, without lawful or reasonable excuse, fails to comply with the record-keeping requirement commits an offence and is liable on summary conviction to a fine not exceeding one hundred thousand dollars or imprisonment for a term not exceeding five years (section 2A(4)).

Applies to

trustees, trust companies, personal representatives, settlors, beneficiaries, protectors of trusts

Deadlines

• at least five years: Minimum period trustees must retain trust records and underlying documentation under section 2A.

Related documents

• Trustee (Amendment) Act, 2021 amends this document
• Trustee (Amendment) Act, 2024 amends this document