BVI Approved Managers Regime
January 2014

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In 2012 a new "regulatory light" regime for certain investment managers was introduced in the British Virgin Islands. The Investment Business (Approved Managers) Regulations, 2012 (the "Regulations") and the associated Approved Investment Managers Guidelines took effect from December 10 2012. In January 2014 the Regulations were then amended to extend the regime to include managers of non-BVI funds. The Regulations allow investment managers that meet certain criteria to apply to become Approved Managers without the need to comply with  certain provisions of the BVI Securities and Investment Business Act, 2010 ("SIBA") and the BVI Regulatory Code, 2009 (the "Regulatory Code").



Key features of the Approved Manager Regime

To be eligible to apply to be an Approved Manager, an investment manager must:

(a) be a BVI company or limited partnership;

(b) be proposing to act as the investment manager or investment advisor to:

(i) a private fund or a professional fund recognized under SIBA;

(ii) a closed-ended fund (with the characteristics of a private or professional fund) domiciled in the BVI or a Recognised Jurisdiction;

(iii) an entity affiliated to a fund described in (i) and (ii) above;

(iv) any fund domiciled in a Recognised Jurisdiction that has equivalent characteristics to a private fund or professional fund;

(v) any foreign fund (ie. not domiciled in BVI or a Recognised Jurisdiction) that has equivalent characteristics to a private, professional or a closed end fund and which invests all or a substantial part of its assets in one or more of the funds outlined in (i) and (ii) above; or

(vi) such other funds as the BVI Financial Services Commission (the "FSC") may allow.
(collectively "relevant business");

(c) satisfy the FSC's fit and proper test; and

(d) have aggregate assets under management not exceeding US$400 million for the management of open-ended funds or, in the case of closed-ended funds, aggregate capital commitments not exceeding US$1 billion.

As set out in the Securities and Investment Business Recognised Jurisdictions Notice, 2010 the recognized jurisdictions are:

Argentina, Australia, Bahamas, Bermuda, Belgium, Brazil, Canada, Cayman Islands, Chile, China, Denmark, Finland, France, Germany, Gibraltar, Greece, Guernsey, Hong Kong,  Ireland, Isle of Man, Italy, Japan, Jersey, Luxembourg, Malta, Mexico, Netherlands, Netherlands Antilles, New Zealand, Norway, Panama, Portugal, Singapore, Spain, South Africa, Sweden, Switzerland, United Kingdom and the United States of America.

Approved Manager application process

An application to the FSC must be made at least 7 days prior to the intended date of commencement of the relevant business. The application fee is US$1000.

A person who submits an Approved Manager application may commence and carry on business for a period of up to 30 days whilst the application is being considered.

Where the FSC does not grant approval the applicant is required to cease carrying on any relevant business.

An application for approval as an Approved Manager follows a prescribed form and requires far less supporting documentation that a full manager's licence. 

Ongoing obligations of an Approved Manager

An Approved Manager is required at all times to have at least two directors, one of whom must be an individual. Additionally, an Approved Manager is also required to have a BVI authorized representative.
Where there is a change to any of the information provided by the Approved Manager in its application for approval, it is obliged to notify the FSC within 14 days, providing details of the change and a declaration as to whether or not the change complies with the requirements of the Regulations.
There is also an ongoing requirement to notify the FSC of any matter in relation to it or its conduct of relevant business, which is likely to have a material impact on the Approved Manager's regulatory status or the relevant business it conducts.

An Approved Manager is required to prepare and submit to FSC financial statements, but these need not be audited. It will also need to file an annual return.

Renewal of Approved Manager status

Approved Manager status must be renewed annually by the payment of a fee of US$1500. Failure to pay the annual renewal fee will attract penalties and failure to pay outstanding fees and penalties means Approved Manager status will no longer apply and the entity must cease relevant business.

Restrictions on an Approved Manager

Subject to the assets under management requirements outlined above and provided the funds managed constitute relevant business an Approved Manager is not restricted as to the number of funds it may act for.

Advantages of the Approved Manager Regime

The ongoing regulatory obligations imposed upon an Approved Manager are less onerous than those for a manager holding an investment business licence under SIBA. The Regulatory Code is dis-applied which means that, amongst other things, an Approved Manager does not need to appoint a compliance officer or establish and maintain a compliance procedure manual. It will also be exempt from the Regulatory Code's capital adequacy and professional indemnity requirements.

The new regime will allow qualifying BVI managers to obtain regulated status in the BVI in a matter of days as opposed to weeks. In particular, it offers affordable light touch regulation to managers of funds with less than 50 investors that is not necessarily available in other offshore jurisdictions.

For more information on the Approved Manager regime or BVI regulatory matters generally please contact Rob McIntyre, Head of BVI Funds and Corporate, at

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