10 July 2015
2015 Insolvency and Corporate Reorganisation Report: British Virgin Islands
In an article for IFLR 1000, partner Ben Mays and senior associate Sharon Mungall assess the bankruptcy and insolvency regime in the British Virgin Islands covering the following questions:
- What reorganisation and bankruptcy processes are available for financially troubled debtors?
- Is a stay on creditor enforcement action available?
- What are the key features of a reorganisation plan and how is it approved?
- Can a creditor or a class of creditor be ‘crammed-down’?
- Is there a process for facilitating the sale of a distressed debtor’s assets or business?
- What are the duties of directors of a company in financial difficulty?
There has been a drop-off in the number of liquidation applications filed in the BVI Court in 2014 after a record number in 2013. However, there remains a steady flow of significant high-value liquidations.
Government and the financial services industry are in consultation about updating and improving the Act, with resulting amendments expected during 2015.
As described in our briefing, the Singularis decision may have an important impact on how cross-border insolvencies are treated in the BVI.