The role of a chargee in a BVI company

Key takeaways

• A chargee is someone who has the benefit of security that has been granted by a BVI company
• Numerous features make using a BVI company attractive to lenders for structuring finance transactions including:
• Clear and simple registration process
• Robust insolvency legislative regime providing protection – very similar to UK law
• The ability for companies to provide financial assistance to those acquiring their shares
• The validity and effectiveness of any security document that a BVI company enters into is determined by the governing law of the particular document
• There are two registration regimes to consider:
• Mandatory registration – private registration at the companies registered office, on the register of charges maintained by the registered agent
• Public registration (optional) – where filings are made with the Registrar of Corporate Affairs in the BVI and which confers priority over any privately registered or any unregistered charge
• Notations included in the register of members of a BVI company whose shares have been charged by way of security, provide notice of the security for those dealing with the company
• Notice of variation or cessation of a charge can also be filed in the BVI, the variation and release of the underlying charge will be determined by the law of the charge not the filing process