This guide provides an overview of the British Virgin Islands' Approved Manager regime. The regime came into effect on 10 December 2012 with the Investment Business (Approved Managers) Regulations 2012 (the Regulations) and the Approved Investment Managers Guidelines (the Guidelines). It introduces a less onerous regulatory regime for BVI domiciled investment managers and investment advisers and compliments the more heavily regulated investment business licensing regime under Part I of the Securities and Investment Business Act 2010 (SIBA).
The key features of the new regime are:
For eligible managers and advisors, an alternative to licensing under Part I of SIBA
The applicant must be a BVI company or limited partnership
Application form provides for self-certification of "fit and proper" status of the applicant
The approved manager can commence business seven days after filing a short and simple application with the Financial Services Commission (the Commission) pending formal approval
The approved manager can act as manager or advisor to any number of incubator, approved, private or professional funds recognised under SIBA, as well as funds domiciled outside of the BVI in a Recognised Jurisdiction (as defined below) and closed ended funds domiciled in the BVI or in a Recognised Jurisdiction, if they have the key characteristics of a private or professional fund
The approved manager is subject to caps of (i) aggregate assets under management of US$400 million for open ended funds and (ii) aggregate capital commitments of US$1 billion for closed ended funds
Annual return and unaudited financial statements to be filed with the Commission
No capital adequacy or professional indemnity insurance requirements and no requirement to appoint a compliance officer. The Regulatory Code does not apply
At this point in time, a Recognised Jurisdiction for these purposes means:
Argentina, Australia, Bahamas, Bermuda, Belgium, Brazil, Canada, Cayman Islands, Chile, China, Curacao, Denmark, Finland, France, Germany, Gibraltar, Greece, Guernsey, Hong Kong, Ireland, Isle of Man, Italy, Japan, Jersey, Luxembourg, Malta, Mexico, Netherlands, New Zealand, Norway, Panama, Portugal, Singapore, Spain, South Africa, Sweden, Switzerland, United Kingdom and the United States of America.
Criteria for approved managers
An approved manager may carry on business (defined as "relevant business" in the Regulations) as an investment manager or investment adviser to:
1. One or more incubator, approved, private or professional funds recognised under SIBA (or funds domiciled outside the BVI but in a Recognised Jurisdiction)
2. One or more closed ended funds which are domiciled in the BVI and have certain key characteristics of a private or professional fund
3. One or more open ended or closed ended funds which are domiciled in a Recognised Jurisdiction and have certain characteristics of a private or professional fund
4. One or more non-BVI funds (open ended or closed ended) investing a substantial part of its assets in a fund described in (a), (b) or (c) above
5. One or more persons who are affiliated (as defined in the Guidelines) to a fund described in (a) or (b) above
6. Such other person(s) as the Commission may approve on a case by case basis (the most common application under this section being for the purposes of providing some form of management advice to "managed accounts")
Application process - timeframe
An applicant must submit its application in the prescribed form to the Commission at least seven days prior to the intended date of commencement of the "relevant business". After the expiry of the seven day period (or such shorter period as the Commission may approve), the applicant may commence and carry on "relevant business" for a period of up to 30 days (such period being extendable for a further period of 30 days by the Commission). During this 30 day (or extended) period, the applicant will be deemed to have been approved under the Regulations....

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