The British Virgin Islands (“BVI”) is one of the leading offshore investment funds jurisdictions, attracting investment managers and investors worldwide. BVI investment fund structures are well known in the industry and very flexible allowing investment managers to tailor their offering to the needs of investors.
The Professional Fund is the flagship open‑ended fund product in the British Virgin Islands. The key features of a Professional Fund are outlined below.
- Who can invest: Professional investors only. A “professional investor” is either a person whose ordinary business involves acquiring or disposing of property of the same kind as the property, or a substantial part of the property, of the Professional Fund, or who certifies having a net worth above US$1,000,000 and consents to professional investor status.
- Investor limits and minimums: There is no limit on investor numbers, and each investor must make a minimum initial subscription of US$100,000, unless exempted.
- Core appointments and policies: A Professional Fund must: (a) have two directors (at least one being an individual); (b) appoint an administrator and, unless exempted, a manager and custodian; (c) appoint an authorised representative; (d) adopt a clear valuation policy with independence or conflict‑management safeguards; and (e) comply with BVI AML/KYC and FATCA/CRS obligations.
- Annual filings: Professional Funds must file audited financial statements and a Mutual Fund Annual Return each year and are subject to FATCA/CRS reporting obligations.
- Tax position: BVI is tax‑neutral, with no income, corporate, capital gains or withholding taxes imposed by the BVI on a Professional Fund.
- Speed to market: A Professional Fund may commence business for up to 21 days prior to Financial Services Commission recognition if the application is lodged within 14 days of launch and the offering is limited to professional investors with the prescribed investment warning.
- Cost effectiveness: The Professional Fund provides for a cost-effective alternative as maintenance fees are comparatively cheaper compares to other offshore jurisdictions.
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