Shareholder disputes in the British Virgin Islands

By Andrew Willins

The British Virgin Islands (BVI) is best known for its role as a holding company jurisdiction — a jurisdiction through which joint venture parties will often co-operate in ventures far removed from the shores of the BVI in sectors as disparate as energy and natural resources to shipping and trading goods.

The latest statistics released by the BVI Financial Services Commission show that there are some 480,072 active companies on the register and many more that are inactive. It is therefore natural that where differences arise between joint venture parties, it is to the BVI, and its successful Commercial Court, that they head to resolve their disputes.

Such litigation may take a number of different forms. As in Liao v Upbeat Global Ltd (BVIHCM80/2010), a party may challenge the validity of resolutions. In that case, the claimant established at trial that notice of a shareholders meeting had not been given and that DHL packages that had been sent (on the defendant’s case, containing notice of that meeting) were in fact an elaborate fraud, containing nothing other than marketing literature. It may, as in Royal Westminster v Nilon (BVICVAP 2011/0001), take the form of a dispute in relation to the ownership of shares, usually in the form of an action for declaratory relief or an action under section 43 of the BVI Business Companies Act 2004 for rectification of the register, or it may take the form of a derivative action or a claim for unfair prejudice…

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