For those persons who have been carrying on a virtual asset service prior to the coming into force of the VASP Act on 1 February 2023, the VASP Act allows a transitioning period of 6 months (ending therefore on 31 July 2023) within which they can either (1) submit an application to the BVI FSC to be registered as VASPs or (2) cease their VASP- related operations altogether.

Who is a Virtual Asset Service Provider?

By way of recap, the VASP Act defines a VASP as a virtual asset service provider who provides, as a business, a virtual assets service and is registered under the VASP Act to conduct one or more of the following activities or operations for or on behalf of another person:

1. exchange between virtual assets and fiat currencies;
2. exchange between one or more forms of virtual assets;
3. transfer of virtual assets, where the transfer relates to conducting a transaction on behalf of another person that moves a virtual asset from one virtual asset address or account to another;
4. safekeeping or administration of virtual assets or instruments enabling control over virtual assets;
5. participation in, and provision of, financial services related to an issuer’s offer or sale of a virtual asset; or
6. perform such other activity or operation as may be specified in the VASP Act or as may be prescribed by regulations made by the BVI FSC in connection with the VASP Act.

A virtual asset is a digital representation of value that can be digitally traded or transferred, and can be used for payment or investment purposes, but specifically does not include the following:

1. digital representations of fiat currencies and other assets or matters specified in the guidelines which have been, and may in the future be, published in conjunction with the VASP Act; or
2. a digital record of a credit against a financial institution of fiat currency, securities or other financial assets that can be transferred digitally.

Services Expressly Caught by the VASP Act

The following services have been included in a non-exhaustive list of virtual assets services and are, as such, regulated by the VASP Act when carried out on behalf of another person:

1. hosting wallets or maintaining custody or control over another person’s virtual asset, wallet or private key;
2. providing financial services relating to the issuance, offer or sale of a virtual asset;
3. providing kiosks (such as automatic teller machines, bitcoin teller machines or vending machines) for the purpose of facilitating virtual assets activities through electronic terminals to enable the owner or operator of the kiosk to actively facilitate the exchange of virtual assets for fiat currency or other virtual assets; or
4. engaging in any other activity that, under issued guidelines, constitutes the carrying on of the business of providing virtual asset service or issuing virtual assets or being involved in virtual asset activity.

Services Specifically Excluded from the Application of the VASP Act

Rather helpfully, the VASP Act also sets out a non-exhaustive list of some of the services which are specifically excluded from its remit and these are as follows:

1. providing ancillary infrastructure to allow another person to offer a service, such as cloud data storage provider or integrity service provider responsible for verifying the accuracy of signatures;
2. providing service as a software developer or provider of un-hosted wallets whose function is only to develop or sell software or hardware;
3. solely creating or selling a software application or virtual asset platform;
4. providing ancillary services or products to a virtual asset network, including the provision of services like hardware wallet manufacturer or provider of un-hosted wallets, to the extent that such services do not extend to engaging in or actively facilitating as a business any of those services for or on behalf of another person;
5. solely engaging in the operation of a virtual asset network without engaging or facilitating any of the activities or operations of a VASP on behalf of customers;
6. providing closed-loop items that are non-transferable, non-exchangeable and which cannot be used for payment or investment purposes; and
7. accepting virtual assets as payment for good or services (such as the acceptance of virtual assets by a merchant when effecting the purchase of goods).

Globalization is defined as the process of interaction and integration among people, companies, and governments worldwide. It is primarily an economic process of interaction and integration causing a growth in international trade and the exchange of ideas, beliefs, and culture.

Economically, globalization involves the international exchange of goods, services, data, technology, and the economic resources of capital which along with advances in telecommunication have developed and expanded global markets to facilitate the economic activities of the exchange of goods, services and capital.

This article seeks to briefly assess where the British Virgin Islands (BVI) stands in the current period of globalization (Globalization 3.0) and also to explore the future of the BVI under the next phase of Globalization 3.0.

The American political commentator, Thomas L. Friedman in his book, “The World Is Flat: A Brief History of the Twenty-first Century” divides the history of globalization into three periods: Globalization 1.0 (1492–1800), Globalization 2.0 (1800–2000) and Globalization 3.0 (2000–present). The Globalization 1.0 period, according to Friedman, involved the globalization of countries, “the main agent of globalization was the nation-state globalizing for Empire, or for resources, or for power.” Globalization 2.0 involved the globalization of companies. During this period, Friedman argues, globalization “was spearheaded by companies globalizing for markets, for labor, and for resources.” The activities related to this phase further broke down the barriers of international borders, trade, and cross-cultural connections.

The third and current phase of globalization, what is referred to as Globalization 3.0, involves the globalization of individuals. This began around the year 2000. Friedman noted that “what’s really new, really exciting, and really terrifying about this era of globalization is that it is built around individuals. What is really new about this era is that we now have individuals that can compete, connect, and collaborate globally as individuals.”

Features of Globalization 3.0 include the development of the personal computer, which “allowed individuals, for the first time in history, to author their own content” in digital form, the “dot com bubble,” which funded the necessary infrastructure for global internet access, the development of optical fibre and cable connectivity arrangements, leading to a revolution in global connectivity. The development of the internet from the “static web”, made of read-only webpages that, by and large, lacked much in the way of interactive features, to web 2.0, which is what we have now, and marks the internet’s evolution into an era of dynamic content. Users can interact with web pages, communicate with each other and create content – for example on social media networks like Weibo, Twitter, WeChat, Facebook, and Instagram.

Developers of Web 3.0 infrastructure (with its different sectors, such as (i) Decentralised Finance or DeFi, (ii) NFTs, and (iii) Decentralized autonomous organizations (DAOs)) are increasingly using BVI entities to own and manage their creations as BVI companies are relatively cheap to establish, take 1-2 days to be formed and their annual maintenance costs compare well against other offshore jurisdictions like the Cayman Islands and Bermuda, and mid-shore jurisdictions like Luxembourg, Hong Kong and Singapore.

Web3.0 is predicted to include the next evolutionary stage of the internet which involves decentralization, token-based economies and blockchain technology. Decentralization means internet users can transact business peer-to-peer, cutting out intermediaries and removing power from controlling entities. With Web 3.0, there is a greater focus on user privacy, transparency and ownership. The BVI has a common law legal system that facilitates commercial transactions and maximizes flexibility and additionally has been introducing legislation such as the Data Protection Act, 2021 (“DPA”) to enhance the protection of rights related to privacy, transparency and ownership. Under the DPA, any BVI entity that handles an individual’s personal information will have obligations with respect to how that data is handled. For example, the individual to whom the information relates must be informed of what their personal information is being used for, and by whom. The processing and control of such data must also abide by certain specific principles.

The increasing use of Blockchain and other distributed ledger technology (DLT), big data and artificial intelligence (AI) as well as cloud computing is likely to cause significant transformation of the financial sector as the use of DeFi, NFTs and other DLT features expand. For example, investment Fund managers are already being significantly affected by improved availability of data, by algorithms, the digitization of assets, and by new processes in custody, settlement and reporting. As a fast-growing jurisdiction for offshore investment funds investing in sectors such as web3.0 and AI, the BVI has been developing its laws to ensure that it encourages the use of BVI structures within the framework of international standards. The BVI is committed to ensuring that its financial services industry is aligned with international best prac¬tices and compliant with the standards imposed by the Financial Action Task Force in order to actively participate in the various aspects of this next exciting phase of Globalization 3.0. The BVI has enacted the Virtual Asset Service Providers Act, 2022 (“VASP Act”) to implement the Financial Action Task Force’s standards on virtual assets and virtual asset service providers (“VASPs”). The VASP Act creates the legal framework for the registration and supervision of Virtual Assets Service Providers (VASPs) operating in and from within the BVI.

On 1 December 2022, the BVI implemented measures to ensure a VASP which is carrying on or providing “virtual asset services” when a transaction involves virtual assets valued at US$1,000 or more is required to be compliant with the BVI’s Anti-Money Laundering Regulations (“AMLRs”) and related Anti-Money Laundering and Terrorist Financing Code of Practice (“Code”).

With the advantage of having a sophisticated legal framework that includes the VASP Act, the AMLRs, the Code, and the DPA, the BVI is setting itself as a key jurisdiction for individuals around the global to set up corporate structures to actively participate in the next phase of Globalization 3.0, namely the development and growth of (i) artificial intelligence (AI) and (ii) Web 3.0 infrastructure (e.g. DeFi, NFTs, etc.).

Other advantages of the BVI such as (i) aligning with international best prac¬tices and compliant with the standards imposed by the Financial Action Task Force, (ii) the absence of currency exchange controls, (iii) tax neutrality (i.e. utilizing BVI entities or trusts does not add to the tax burden or complexity of a corporate group structure as there are no income tax, capital gains tax, corporation tax, wealth tax or other taxes applicable to the BVI entities or trusts), (iv) political stability, and (v) a common law legal system that facilitates commercial transactions and maximizes flexibility, will make the BVI increasingly competitive in the next phase of Globalization 3.0.

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This publication is not intended to be a substitute for specific legal advice or a legal opinion. For specific advice on the formation, structuring and regulation of crypto/digital assets offerings in the BVI, please contact your usual Loeb Smith attorney or any of the following:

E: gary.smith@loebsmith.com
E: robert.farrell@loebsmith.com
E: cesare.bandini@loebsmith.com
E: peter.vas@loebsmith.com
E: elizabeth.kenny@loebsmith.com
E: wendy.au@loebsmith.com
E: vivian.huang@loebsmith.com
E: faye.huang@loebsmith.com
E: yun.sheng@loebsmith.com

The British Virgin Islands (BVI) and the Cayman Islands remain among the most popular jurisdictions for incorporating cryptocurrency trading vehicles. For example, the bankrupt cryptocurrency exchange FTX Trading identified that 22% of its customer base is located in the Cayman Islands, with 11% in the BVI. This is unsurprising, given the considerable benefits of trading cryptocurrencies through offshore vehicles, including tax neutrality, high levels of confidentiality, and low incorporation and annual maintenance costs.

This article considers some tips and traps related to cryptocurrency trading vehicles incorporated in the BVI and the Cayman Islands.

Cost-sensitive clients typically opt to incorporate a company in the BVI because the annual government maintenance fees are lower. Provision of a non-PO Box address, which is required by many cryptocurrency exchanges, usually also escalates costs in the Cayman Islands, whereas most BVI-registered agents offer this service as standard.

The constitutional documents of a Cayman Islands company are confidential, while the memorandum of association and articles of association of a BVI company are a matter of public record. Therefore, those needing to include commercially sensitive provisions in their constitutional documents, such as pursuant to a shareholders’ agreement, may prefer to incorporate a Cayman Islands company.

Clients are advised to carefully review the terms of service of their preferred exchange. In the case of the bankrupt cryptocurrency lending platform Celsius Network, the US Bankruptcy Court, Southern District of New York, held that certain customers transferred ownership of coin deposits in their “earn accounts” to Celsius, rendering the assets presumptively property of the Celsius bankruptcy estate. Recovery by these depositors is, therefore, most likely limited to cents on the dollar.

It is worth noting that the court’s ruling was fact-sensitive and largely based on an ordinary construction of Celsius’ terms of service, pursuant to which ownership of cryptocurrencies is purportedly transferred. This leaves open the possibility that cryptocurrency depositors could – in the absence of any terms to the contrary – assert a proprietary claim over their assets on a cryptocurrency exchange, thereby taking the assets outside of the exchange’s insolvent estate.

This same issue arises in the chapter 11 bankruptcy proceedings of FTX, as its latest version of the terms of service specifically states that “title to … digital assets shall at all times remain with [the customer] and shall not transfer to FTX Trading”.

Certain cryptocurrency exchanges have established a practice of offering lines of credit to eligible depositors. These facilities are often secured with debenture-style security as part of the standard terms. Importantly, this may inhibit the company’s corporate flexibility depending on the agreed covenants and will at least necessitate the insertion of an entry in the company’s security register to comply with applicable law.

Cryptocurrency trading companies incorporated in the BVI or the Cayman Islands should carefully consider licensing, registration and other regulatory requirements. Compliance may be necessary under legislation regulating virtual asset service providers, mainstream financial services legislation, and provisions regulating anti-money laundering. Increasingly, the author sees banks and other service providers requesting a legal opinion to confirm that the relevant cryptocurrency trading company has complied with all applicable local law as part of its onboarding requirements.

Cryptocurrency trading vehicles should carry out an economic substance analysis to ensure no “relevant activities” are inadvertently being conducted, and that all economic substance filings are accurate and complete. In some instances, offshore companies trading cryptocurrencies have appointed C-level personnel theoretically giving rise to “headquarters business”. This could, in turn, oblige compliance with the economic substance test. The author has also seen filings by companies declaring they are conducting “holding company business”, while no relevant activities are being performed. This may give rise to penalties.

BVI and Cayman Islands companies must maintain records and underlying documentation in a form that is sufficient to show and explain its transactions, and enable its financial position to be determined with reasonable accuracy. In some cases, board and shareholder resolutions are also required to ensure due authorisation in accordance with the constitutional documents of the company.

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PETER VAS is a partner at Loeb Smith Attorneys in Hong Kong

This article was first published in the Asia Business Law Journal.

Contact details:
E: peter.vas@loebsmith.com

A BVI Professional Fund is the most popular type of BVI open-ended investment fund. According to the BVI Financial Services Commission (“FSC”) statistical bulletin for Q3 of 2022, published on 21 December 2021, as at 30 September 2022, there were 856 Professional Funds recognized by the FSC in the BVI.

A Professional Fund may carry on business in the BVI for up to 21 days prior to obtaining recognition by the FSC, provided that the Professional Fund lodges an application for recognition with the FSC within 14 days of launch. The FSC may recognize a mutual fund as a Professional Fund if it is satisfied that the following qualifying criteria are met (“Recognition Requirements”):

Minimum initial investment: US$100,000 or its equivalent in another currency. However, the minimum investment limit does not apply to the Manager, Administrator, promoter, underwriter or an employee of the Professional Fund, which are each classed as “exempted investors”.

Eligibility requirements: Only suitable for “professional investors”. A professional investor is a person (i) whose ordinary business involves, whether for that person’s own account or the account of others, the acquisition or disposal of property of the same kind as the property, or a substantial part of the property, of the Fund or (ii) who has signed a declaration that the person, whether individually or jointly with such person’s spouse, has net worth in excess of US$1,000,000 (or its equivalent in any other currency) and that person consents to being treated as a professional investor.

No. of Directors: At least two Directors. At least one Director should be an individual. There is no need for a person to register as a Director with the FSC or for a Director to be resident in the BVI.

Investment Warning: Whilst a Professional Fund will typically have an offering document in order to attract professional investors, this is not a requirement. If a Professional Fund does not have an offering document, as a minimum, it must (i) provide an explanation to the FSC of the reason why it does not have an offering document, and (ii) issue a prescribed investment warning statement to potential investors.

Public interest consideration: Recognition by the FSC of a Professional Fund must not be against the public interest.

A Professional Fund must not use the term “fund” or “mutual fund” or any derivative thereof in its name, unless the Professional Fund has obtained the prior written approval of the FSC and paid the requisite fee.

What service providers is a Professional Fund required to have?

In accordance with the Mutual Funds Regulations (Revised 2020) (the “Regulations”), a Professional Fund should at all times have an Auditor, Manager, Administrator and Custodian appointed. However, a Professional Fund can make an application to the FSC for exemption from the requirement to appoint a (i) Custodian (ii) Manager, and/or (iii) Auditor. There is no exemption for a Professional Fund from the requirement to have an Administrator.

A Custodian appointed by a Professional Fund needs to be functionally independent from the Manager and the Administrator or, where this is the same person, it must have systems and controls in place to ensure that persons fulfilling the custodial function are independent from the fund management or administration functions.

A Professional Fund is also required to appoint a Money Laundering Reporting Officer and an Authorised Representative.

Who can value a Professional Fund’s assets?

In accordance with the Regulations, a Professional Fund is required to maintain clear and comprehensive policies and procedures for the valuation of fund property. These policies and procedures are required to be submitted with the application for recognition.

Generally, a Professional Fund should ensure that the person having responsibility for the investment function (e.g. the Manager) is independent from the person with responsibility for the valuation process.

However, if a Professional Fund determines that the same person will have responsibility for both the investment function and valuation process, the Professional Fund is required to identify, manage and monitor and potential conflicts of interest that may arise and disclose this fact and how any potential conflicts of interest will be managed to the investors.

What are the financial record keeping requirements?

A Professional Fund is required to prepare annual audited accounts in accordance with internationally recognized and generally accepted accounting standards and file such audited accounts with the FSC within 6 months of the Professional Fund’s financial year end. This annual audit filing deadline can be extended upon request by the Professional Fund for a maximum of 3 months.

In addition, in accordance with the Securities Investment Business Act (“SIBA”), a Professional Fund is required by statute to maintain records that are sufficient to evidence and explain its transactions and enable its financial position to be determined with reasonable accuracy. A Professional Fund is required to retain such records for 5 years. If a Professional Fund fails to maintain records in compliance with SIBA, it is liable on summary conviction to a penalty at company level of US$20,000.

The FSC may take enforcement action against a Professional Fund if in the FSC’s opinion, the Manager, Administrator or a Custodian (each a “Functionary”) does not satisfy its “fit and proper” criteria, or the Professional Fund no longer satisfies the Recognition Requirements. Where the FSC is entitled to take enforcement action against a Professional Fund, it may issue a directive that the Professional Fund suspends the issuance and/or redemption of interests in the Professional Fund.

Before the Amendment Act came into force, there were two distinct processes under the Companies Act which dealt with the restoration of companies that had been struck off and those which had been dissolved, respectively.

A company which was struck-off for a continuous period of 7 years was automatically dissolved with effect from the last day of that 7-year period¹. An application could be made to the Registry of Corporate Affairs prior to dissolution by the company or a creditor, member or liquidator of the company.

A similar (but less straight-forward) process was available for companies which had been dissolved. An application could be made to the BVI Court by a creditor, former director, former member or former liquidator of the company or indeed any person who was able to establish an interest in the company being restored². Any application to restore a dissolved company was required to be made within the period of 10 years after the date of dissolution of the company.³

Therefore, in some cases, it would be possible to restore a company as long as 17 years after it was initially struck-off (for example, where a company was struck off for a period of 7 years before being dissolved, it would then be a further 10 years before restoration of the dissolved company ceased to be available).

A company that was restored was deemed to have continued in existence as if it had not been struck off or (as applicable) dissolved and (in the case of a company that had been dissolved) any assets that had vested in Crown as a result of its dissolution was required to be returned to the company.

The amendments made to the Companies Act by the Amendment Act make significant changes to the circumstances in which companies that have been struck-off are dissolved and also to the permitted timescales within which an application to restore a struck-off or dissolved company can be made.

Under the Amended Companies Act, a company that is struck-off will be automatically dissolved on the date the Registry of Corporate Affairs publishes a notice of striking-off of the company, which will be done approximately 90 days after the company is struck-off. The previous 7-year gap between striking-off and dissolution has therefore all but vanished.

As regards the process of restoring a struck-off / dissolved company, section 217 of the Amended Companies Act states that an application in the approved form may be made and that if the conditions in section 217(2) of the Amended Companies Act are met, the company will be restored. The conditions in section 217(2) are:

• the company was carrying on business or in operation as at the date it was struck-off and dissolved;
• a licensed person is willing to be the company’s registered agent on restoration and that registered agent has updated the company’s records;
• in circumstances where any of the company’s assets have, following its striking-off and dissolution, vested in the Crown bona vacantia, the Financial Secretary has expressly or impliedly consented to the restoration of the company;
• the company has paid the applicable restoration fee and other outstanding amounts; and
• the Registry is otherwise satisfied that it would be “fair and reasonable” for the company to be restored.

The timescale within which an application for restoration of a company has also been shortened from 7 years to 5 years, with such 5-year period commencing on the date on which the notice of striking-off is published in the BVI Gazette.

Importantly, however, it should be noted from the above that dissolved companies can now be restored by way of an application to the Registry, whereas this would (as noted in the previous section) have previously required an application to the BVI Court. Whilst there may be some justified concern around the significantly altered time periods noted above, this streamlined process for restoring dissolved companies is a welcome development.

For the avoidance of doubt, an application to the BVI Court is still required in circumstances where the company that is to be restored was dissolved following the conclusion of its liquidation⁴.

One immediate question that arises from the provisions of the Amended Companies Act relating to the restoration of companies, is what do these changes mean for companies who, as at the time the Amendment Act came into force, were struck-off but not dissolved and whose striking-off was published in the BVI Gazette? Does this mean that the former provisions apply to such companies or has their date of dissolution been back-dated to tie in with the provisions of the Amended Companies Act?
Fortunately, clarity on this issue is provided by the “Transitional Provisions Applying to Struck Off And Dissolved Companies” in sections 60A to 60G (inclusive) of the Amendment Act:

• For companies who, as of 1 January 2023 (the Effective Date), were struck-off and not restored, they have until 30 June 2023 to apply to the Registrar to be restored to the register unless (A) the previously applicable 7-year period⁵ ends prior to such date, in which case that earlier date shall be the deadline for applying for restoration; or (B) the previously applicable 7-year period ends after 30 June 2023, in which case 30 June 2023 shall be the deadline. If a struck-off company is not restored on or by such dates (whichever is applicable), that company will be dissolved on the day thereafter; and
• For companies who, as of the Effective Date, were dissolved, they have until 1 January 2028 to apply for restoration unless (A) the previously applicable 10-year period ends prior to such date, in which case that earlier date shall be the deadline; or (B) the previously applicable 10-year period ends after 1 January 2028, in which case 1 January 2028 shall be the deadline

Restoring companies that have either been struck-off or dissolved has always (necessarily) been a process-driven matter. Notwithstanding some welcome changes that have been brought about by the Amendment Act this very much remains the case.

We have advised on a significant number of BVI company restorations, and we are well placed to do so in light of these developments. Please contact a member of our team, who will be able to discuss the options available to you under the law as it now stands and to guide you through the restoration process.

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1 Section 216 of the Companies Act.
2 Section 218 of the Companies Act.
3 Section 218(2) of the Companies Act
4 Section 218 of the Amended Companies Act.
5 Per Section 216 of the Companies Act

This publication is not intended to be a substitute for specific legal advice or a legal opinion. For specific advice on restoration of struck-off and dissolved companies in the British Virgin Islands, please contact your usual Loeb Smith attorney or any of the following:

E: gary.smith@loebsmith.com
E: robert.farrell@loebsmith.com
E: elizabeth.kenny@loebsmith.com
E. peter.vas@loebsmith.com
E: vivian.huang@loebsmith.com
E: yun.sheng@loebsmith.com
E: faye.huang@loebsmith.com

The starting point to assessing the transferability of a loan portfolio is to review the loan agreement to identify any restrictions on the ability of a lender to effectuate a transfer of the relevant loan(s). For example, the borrower’s prior written consent may be required to the transfer of the loan(s) and the loan agreement may prescribe the circumstances under which the borrower may refuse to provide that consent. Furthermore, there may be restrictions on the transferability of certain types of loan portfolios, such as those including mortgages or consumer loans, and the transferor may also be subject to onerous internal confidentiality rules and data protection requirements. Although these are principally points of onshore law to be determined under the governing law of the loan agreement, to the extent that the borrower is incorporated in the BVI or the Cayman Islands and is a party to the transfer agreement(s), it is customary for offshore legal counsel to the lender to issue a legal opinion to confirm (among other things) that the relevant company has the requisite capacity and power to enter into the transfer agreement(s).

Most cross-border loans in Asia are supported by an offshore security package. A potential purchaser of a loan portfolio should therefore keep the following points in mind.

–  Careful consideration must be given to the method by which the outgoing secured party’s security interests are transferred to the purchaser or its nominee. For example, there is generally no way to assign legal title to a chose in action or other property right under BVI law. Therefore, if a party wishes to transfer legal title to a right in action under BVI law, this can normally only be accomplished by way of novation. However, it is possible for choses in action to be assigned in the BVI in equity, and this is the normal mechanism by which this is done.

–  Until the security provider is notified of the assignment, it may discharge any of its obligations for the benefit of (or making payment to, as the case may be) the original assignor. However, the assignment itself is valid between the assignor and the assignee, and the assignor may need to account to the assignee under the terms of the assignment. There is no requirement that notice to the security provider must be given in writing or that the security provider acknowledge receipt of the notice, although this is customarily done for evidential reasons.

–  If the security provider is a BVI company and has registered details of the security in its register of registered charges maintained by the BVI Registrar of Corporate Affairs (the “Registrar”), it must register a variation of charge with the Registrar to comply with BVI law. The Registrar will issue a certification of variation of charge and stamp the particulars of the variation of security as evidence that the variation has been duly registered.

–  If the security provider is a BVI company and has registered details of the security in its register of registered charges maintained by the BVI Registrar of Corporate Affairs (the “Registrar”), it must register a variation of charge with the Registrar to comply with BVI law. The Registrar will issue a certification of variation of charge and stamp the particulars of the variation of security as evidence that the variation has been duly registered.

In practice, a well-drafted assignment agreement will impose an express obligation on the relevant parties to complete all of the local law filings and register updates within a mutually acceptable timeframe. Offshore legal counsel should be retained to ensure that all such filings are correctly completed and that the transfer mechanics comply with BVI or Cayman Islands law (as applicable).

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This publication is not intended to be a substitute for specific legal advice or a legal opinion. For specific advice, please contact:

Peter Vas
Partner
Loeb Smith Attorneys
Hong Kong
E: peter.vas@loebsmith.com
www.loebsmith.com
Peter is recognized as a leading offshore lawyer in the Asia Business Law Journal A-List 2022 and Asian Legal Business Offshore Client Choice List 2022