Oct 2023
BVI companies that were struck off prior to 1 January 2023 were automatically dissolved and ceased to exist after 30 June 2023. Any assets held by such companies have now automatically been vested in the Crown. In order to reverse this, it is necessary to apply to the BVI Court to restore the company to good standing.
Amendments to BVI company law which came into effect on 1 January 2023
Previously, if a BVI company did not pay its annual government fees, it was struck off five months after the relevant due date. A struck off company could then be restored to good standing (within seven years of strike off) by paying the outstanding government fees, certain penalties and a restoration fee. If the struck off company was not restored within seven years, it was automatically dissolved and a court application (within seven years of the date of dissolution) was required to restore the company.
On 1 January 2023, certain amendments to BVI company law came into effect pursuant to which: (1) companies which fail to pay their annual fees or do not have a registered agent appointed are now automatically and immediately dissolved (without the existence of a struck off period as per the previous regime); and (2) any application to restore a dissolved company must be made within five years of the date of the company’s dissolution (as opposed to seven years under the previous regime).
Transitional rules
Transitional rules applied to those BVI companies which were struck off prior to 1 January 2023 (“Existing Struck off Companies”).
Existing Struck off Companies had until 30 June 2023 to apply to the BVI Registrar of Corporate Affairs (the “Registrar”) to be restored to good standing via a simple out-of-court process. As this deadline has now passed, however, all Existing Struck off Companies which have not been restored have now been automatically dissolved.
The dissolved Existing Struck off Companies may now only be restored by way of an application to the BVI Court. Such applications must be made within five years of the dissolution of the company. The “out of court procedure” for restoration that applies to companies struck off since 1 January 2023 unfortunately does not apply to Existing Struck off Companies, meaning that an application to the BVI Court is the only option available to restore such Existing Struck off Companies.
Next Steps
In order to commence the court restoration process, notice of the application should be served on each of the Registrar, the Financial Secretary and the Financial Services Commission (if the entity was previously a regulated person). There will be at least one court hearing and the timeframe will depend on the complexity of the matter. The court process can be initiated by creditors, former members or former directors of the company, amongst others. The process is usually straightforward and has a good chance of success, provided that a beneficial purpose can be shown for the company’s restoration.
The Conyers team would be delighted to assist you with the restoration of BVI companies. If you would like to learn more about the various ways in which we can help, please reach out to one of the below individuals or your usual contact at Conyers.