BRITISH VIRGIN ISLANDS (BVI) COMPANY
SHARE CAPITAL
Power to Allot Shares
Subject to any limitations or provisions to the contrary in its memorandum
or articles, the unissued shares and treasury shares of a company
incorporated under IBC Act (Inenational Business Companies Act 1984) shall be at the disposal of the directors
who may, without limiting or affecting any rights previously conferred
on the holders of any existing shares or class or series of shares,
offer, allot, grant options over or otherwise dispose of shares to
such persons, at such times and upon such terms as the company may,
by resolution of directors, determine.
Shares to be Fully Paid
No share in a company incorporated under IBC Act may be issued until
the consideration in respect of the share is fully paid, and when
issued the share is for all purposes fully paid and non-assessable
save that a share issued for a promissory note or other written
obligation for payment of a debt may be issued subject to forfeiture
in the manner prescribed in section below.
Considerations for Shares
Subject to any limitations or provisions to the contrary in its
memorandum or articles each share in a company incorporated under
IBC Act shall be issued for money, services rendered, personal property
(including other shares, debt obligations or other securities in
the company), an estate in real property, a promissory note or other
binding obligation to contribute money or property, or any combination
thereof.
Forfeiture of Shares
The memorandum or articles, or an agreement for the subscription
of shares, of a company incorporated under IBC Act may contain provisions
for the forfeiture of shares for which payment is not made pursuant
to a promissory note or other written binding obligation for payment
of a debt. Any provision in the memorandum or articles, or in an
agreement for the subscription of shares of a company incorporated
under IBC Act providing for the forfeiture of shares shall contain
a requirement that written notice specifying a date for payment
to be made be served on the member who defaults in making payment
pursuant to a promissory note or other written binding obligation
to pay a debt.
The written notice shall name a further date not earlier than the
expiration of 14 days from the date of service of the notice on
or before which the payment required by the notice is to be made
and shall contain a statement that in the event of non-payment at
or before the time named in the notice the shares, or any of them,
in respect of which payment is not made will be liable to be forfeited.
Where a notice has been issued under this section and the requirements
of the notice have not been complied with, the directors may, at
any time before tender of payment, by resolution of directors forfeit
and cancel the shares to which the notice relates. The company is
under no obligation to refund any moneys to the member whose shares
have been cancelled and that member shall be discharged from any
further obligation to the company.
Amount of Consideration for Shares
Subject to any limitations or provisions to the contrary in its
memorandum or articles, shares in a company incorporated under IBC
Act may be issued for such amount as may be determined from time
to time by the directors, except that in the case of shares with
par value, the amount shall not be less than the par value; and,
in the absence of fraud, the decision of the directors as to the
value of the consideration received by the company in respect of
the issue is conclusive, unless a question of law is involved.
A share issued by a company incorporated under IBC Act upon conversion
of, or in exchange for, another share or a debt obligation or other
security in the company, shall be treated for all purposes as having
been issued for money equal to the consideration received or deemed
to have been received by the company in respect of the other share,
debt obligation or security.
Fractional Shares
Subject to any limitations or provisions to the contrary in its
memorandum or articles, a company incorporated under IBC Act may
issue fractions of a share and unless and to the extent otherwise
provided in the memorandum or articles, a fractional share has the
corresponding fractional liabilities, limitations, preferences,
privileges, qualifications, restrictions, rights and other attributes
of a whole share of the same class or series of shares.
Authorised Capital in Several Currencies
The authorised capital, if any, of a company incorporated under
IBC Act may be stated in more that one currency in which case the
par value of the shares, if any, shall be expressed in the same
currencies.
Capital and Surplus Accounts
Upon the issue by a company incorporated under IBC Act of a share
with par value, the consideration in respect of the share constitutes
capital to the extent of the par value and the excess constitutes
surplus.
Subject to any limitations or provisions to the contrary in its
memorandum or articles, upon the issue by a company incorporated
under IBC Act of a share without par value, the consideration in
respect of the share constitutes capital to the extent designated
by the directors and the excess constitutes surplus, except that
the directors must designate as capital an amount of the consideration
that is at least equal to the amount that the share is entitled
to as a preference, if any, in the assets of the company upon liquidation
of the company. Upon the disposition by a company incorporated under
IBC Act of a treasury share, the consideration in respect of the
share is added to surplus.
Dividend of Shares
A share issued as a dividend by a company incorporated under IBC
Act shall be treated for all purposes as having been issued for
money equal to the surplus that is transferred to capital upon the
issue of the share. In the case of a dividend of authorised but
unissued shares with par value, an amount equal to the aggregate
par value of the shares shall be transferred from surplus to capital
at the time of distribution.
In the case of a dividend of authorised but unissued shares without
par value, the amount designated by the directors shall be transferred
from surplus to capital at the time of the distribution, except
that the directors must designate as capital an amount that is at
least equal to the amount that the shares are entitled to as a preference,
if any, in the assets of the company upon liquidation of the company.
A division of the issued and outstanding shares of a class or series
of shares into a larger number of shares of the same class or series
having a proportionally smaller par value does not constitute a
dividend of shares.
Increase or Reduction of Authorised Capital
Subject to any limitations or provisions to the contrary in its
memorandum or articles, a company incorporated under IBC Act may
amend its memorandum to increase or reduce its authorised capital,
and in connection therewith, the company may increase or reduce
the number or shares which the company may issue; increase or reduce
the par value of any of its shares.
Where a company reduces its authorised capital, then, for purposes
of computing the capital of the company, any capital that immediately
before the reduction was represented by shares but immediately following
the reduction is no longer represented by shares shall be deemed
to be capital transferred from surplus to capital. A company shall,
in writing, inform the Registrar of any increase or decrease of
its authorised capital.
Division and Combination
A company incorporated under IBC Act may amend its memorandum to
divide the shares, including issued shares, of a class or series
into a larger number of shares of the same class or series; or to
combine the shares, including issued shares, of a class or series
into a smaller number of shares of the same class or series. Where
shares are divided or combined, the aggregate par value of the new
shares must be equal to the aggregate par value of the original
shares.
Character of a Share
Shares of a company incorporated under IBC Act are personal property
and are not of the nature of real property.
Share Certificates
A company incorporated under IBC Act must state in its articles
whether or not certificates in respect of its shares shall be issued.
If a company incorporated under IBC Act issues certificates in respect
of its shares, the certificates must be signed by two directors
or two officers of the company, or by one director and one officer;
or must be under the common seal of the company, with or without
the signature of any director or officer of the company; and the
articles may provide for the signatures or common seal to be facsimiles.
A certificate specifying a share held by a member of the company
is prima facie evidence of the title of the member to the share
specified therein.
Share Register
A company incorporated under IBC Act shall cause to be kept one
or more registers to be known as share registers containing the
names and addresses of the persons who hold registered shares in
the company; the number of each class and series of registered shares
held by each person; the date on which the name of each person was
entered in the share register; the date on which any person ceased
to be a member. In the case of shares issued to bearer, the total
number of each class and series of shares issued to bearer; and
with respect to each certificate for shares issued to bearer the
identifying number of the certificate; the number of each class
or series of shares issued to bearer specified therein; and the
date of issue of the certificate.
But the company may delete from the register information relating
to persons who are no longer members or information relating to
shares issued to bearer that have been cancelled. The share register
may be in any such form as the directors may approve but if it is
in magnetic, electronic or other data storage form, the company
must be able to produce legible evidence of its contents. The share
register is prima facie evidence of any matters directed or authorised
by IBC Act to be contained therein. A company that wilfully contravenes
this section is liable to a penalty of US$25.00 for each day or
part thereof during which the contravention continues, and a director
who knowingly permits the contravention is liable to a like penalty.
Transfer of Registered Shares
Subject to any limitations or provisions to the contrary in its
memorandum or articles, registered shares of a company incorporated
under IBC Act may be transferred by a written instrument of transfer
signed by the transferor and containing the name and address of
the transferee. A company shall not be required to treat a transferee
of a registered share in the company as a member until the transferee's
name has been entered in the share register. Subject to any limitations
or provisions to the contrary in its memorandum or articles, a company
incorporated under IBC Act must, on the application of the transferor
or transferee of a registered share in the company, enter in its
share register the name of the transferee of the share.
A transfer of registered shares of a deceased, incompetent or bankrupt
member of a company incorporated under IBC Act made by his personal
representative, guardian or trustee, as the case may be, or a transfer
of registered shares owned by a person as a result of a transfer
from a member by operation of law, is of the same validity as if
the personal representative, guardian, trustee or transferee had
been the registered holder of the shares at the time of the execution
of the instrument of transfer.
Download a Fact Sheet and quotation now.
See also:
Features and Registration Costs of BVI company
British Virgin Islands Business Company Maintenance Guidelines
British Virgin Islands Business Company Internal Management Notes
British Virgin Islands Business Company Share Capital
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