Economic Substance in the BVI: Change and Opportunity

The EU's goal to be the world leader on tax good governance and to dissuade "problematic third countries" from maintaining systems and legal structures considered to allow tax abuse and unfair tax competition, is well known. The political imposition of economic substance requirements on criterion 2.2 jurisdictions , including the BVI, is the latest step taken towards this goal. In response, the BVI has enacted the Economic Substance (Companies and Limited Partnerships) Act, 2018 (as amended, the ESA), adhering to its commitment to introduce an economic substance regime ahead of the EU's deadline of 31 December 2018.