4 Tips of BVI Hedge Fund Formation

A BVI Hedge Fund provides a person with the opportunity of exposure to an international market in a low tax environment. It has a flexible structure. It has the second most popular authorisation for offshore hedge funds.

The offshore fund formation process is cheaper and convenient in BVI than any other offshore companies. A BVI Fund is a closed-end fund which means there can only be a fixed number of investments for sale.

These funds are not subjected to any supervisory procedure or licencing in relation to an open-end fund. Here are steps to the formation of a BVI Hedge fund formation -:

Establishment of A Business Company

1) The central core of the BVI is called the “business company” and established under the BVI Business Companies Act. The registration is done through a BVI registry. A $350 is paid to the BVI registry for its incorporation as a business company.

Setting Up Of Management Company by the Manager

2) A BVI based management company can be established by the manager but the manager has to first establish a BVI Business Company then go through the registration procedure of the financial services commission.

A fund management company is not established in the BVI for several reasons but the major of it being the establishment of an offshore management company by a manager is quicker and easier.

Recognition of the Hedge Fund

3) The hedge fund established in the BVI must be a recognized BVI Business company by the BVI registry.

BVI Registered Agent

4) A BVI registered agent is necessary for a BVI Business Company. The registered agent has to face harsh penalties if convicted with terrorist activities or other international crimes. The registered agents have to go through a due diligence process. They charge a higher fee in comparison to any other registered agents.