Harney Westwood & Riegels updates

Freezing injunction: what is a good arguable case?
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • British Virgin Islands
  • June 21 2018

The BVI Commercial Court has provided helpful guidance as to the threshold for a good arguable case, dismissing an application to discharge a worldwide freezing injunction obtained by a claimant. The court held that where there is a good arguable case that a defendant has acted fraudulently or dishonestly, or with "unacceptable low standards of morality giving rise to a feeling of uneasiness about the defendant", further evidence is often unnecessary to justify a freezing injunction.

Avoiding evasion: court takes pragmatic approach to serving uncooperative defendants abroad
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • British Virgin Islands
  • June 14 2018

International litigation and asset recovery require the pursuit of defendants and their assets across borders; therefore, it is a routine aspect of BVI litigation for claimants to serve legal documents abroad. Two recent decisions should significantly decrease the delay in effecting service abroad and pave the way for a more efficient approach to service out in the future.

Getting schooled in Nord Anglia – extra safeguards for companies facing appraisal litigation
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • Cayman Islands
  • June 07 2018

In Nord Anglia the justice made directions orders regarding the use of keyword searches, the number and scope of information requests, and the conduct of management meetings consistent with the orders made in Xiadu Life Technology. Further, the judgment will provide welcome safeguards for companies facing appraisal litigation in the Cayman Islands if adopted on a wider basis.

No armchair liquidators – court confirms appointment of provisional liquidators to Swiss company
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • British Virgin Islands
  • June 07 2018

In the latest judgment regarding the DPH liquidation, the BVI Court of Appeal upheld the appointment of BVI provisional liquidators in respect of a Swiss company and clarified that evidence of dissipation of assets (in the Mareva sense) may not be a pre-condition to the appointment of provisional liquidators.

Shanda Games: Court of Appeal confirms timing for leave to appeal to Privy Council
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • Cayman Islands
  • May 31 2018

Appeals to the Privy Council from the Court of Appeal are regulated in the Cayman Islands (Appeals to Privy Council) Order 1984. However, the order does not provide for how to determine the date of a decision. The Court of Appeal recently ruled that for the purposes of an application for leave to appeal to the Privy Council, time runs from the date on which an order is sealed or perfected, not the date on which the judgment is delivered.

Tick, tock – the need to keep an eye on the clock in liquidator applications
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • British Virgin Islands
  • May 24 2018

A recent Court of Appeal decision serves as a useful reminder to keep an eye on the clock when seeking the appointment of liquidators to a company in the British Virgin Islands. The decision makes clear that any extension must be expressly granted and legal practitioners must therefore keep an eye on the clock to avoid a deemed dismissal under Section 168 of the Insolvency Act.

Court strikes out passing-off claim in relation to goodwill held outside British Virgin Islands
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • British Virgin Islands
  • May 17 2018

Claims of passing off are rare in the British Virgin Islands and a recent attempt to bring a BVI action in relation to goodwill held outside the jurisdiction has failed. The court examined the law and relevant English authorities on the tort of passing off. It opined that goodwill is governed by territoriality and that in order to succeed, the claimant must prove that it has goodwill in the form of customers in the jurisdiction in which the suit is undertaken.

Important changes to regulations and compliance for investment funds
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • Cayman Islands
  • March 15 2018

The recent changes that have been made to the anti-money laundering regime will bring the Cayman Islands into line with international best practice and are a welcome update to the territory's financial services landscape. In reality, the changes will not affect the majority of investment funds using the jurisdiction, but updates to documentation and procedures may be required.

Beneficial ownership regime: some companies now in scope
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • Cayman Islands
  • January 25 2018

The Cayman Islands has amended the beneficial ownership register regime for Cayman companies and limited liability companies, meaning that some previously out-of-scope companies are now in scope and must maintain a register. In addition, all out-of-scope companies must now file a written confirmation of the basis for their exemption with their corporate services provider, and these providers must regularly file the received beneficial ownership information with the competent authority.

Court of Appeal provides guidance on directors' powers
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • British Virgin Islands
  • January 18 2018

A recent Court of Appeal ruling provided guidance on directors' powers after considering whether a fresh issuance of shares by directors which altered the balance of voting power between the shareholders was done for a proper purpose. The court held that directors should not issue shares in a manner that could affect the balance of power between groups of shareholders or create new majorities, irrespective of whether the old or new majority have a proprietary interest in the fund.

Launching an ICO in British Virgin Islands
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • British Virgin Islands
  • December 14 2017

Interest in the setting up and distribution of initial coin offerings (ICOs) in the British Virgin Islands and other offshore locations has increased rapidly during 2017, and this is expected to continue. No ICO or blockchain-specific rules or guidelines have yet been issued by the government or regulator; however, there are several important issues for parties in the British Virgin Islands to consider, including the key laws and regulations surrounding the issue.

New Anti-money Laundering Regulations come into force
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • Cayman Islands
  • November 16 2017

The government recently adopted updated Anti-money Laundering Regulations. The regulations demonstrate the Cayman Islands' ongoing commitment to comply with the highest international standards on combating money laundering and terrorist financing and aim to ensure consistency with the Financial Action Task Force 2012 recommendations. The move is part of an overall update of the territory's anti-money laundering regime.

Structuring an ICO through the Cayman Islands
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • Cayman Islands
  • November 02 2017

It seems that 2017 will be remembered as the year of the initial coin offering (ICO). The Cayman Islands is witnessing an upsurge in ICO-related business and structuring an ICO through the territory remains an attractive proposition. However, ICO-specific guidance is yet to be issued by the government or the regulator, and a number of legal uncertainties remain. Existing statutory and regulatory regimes must therefore be considered when structuring an ICO.

BVI continuations and discontinuations – an overview
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • British Virgin Islands
  • October 26 2017

The ability to continue a foreign company as a BVI company or to continue a BVI company as a company under the laws of another jurisdiction quickly and seamlessly is just one example of the many flexible features of the Business Companies Act 2004. This is particularly useful in the context of corporate reorganisations, and counsel should be aware of the process and requirements for continuations and discontinuations.

Beneficial ownership regime – an overview
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • Cayman Islands
  • October 19 2017

Under the Cayman Islands beneficial ownership legislation, certain Cayman companies are required to maintain details of their beneficial owners and relevant legal entities on a beneficial ownership register. Companies should determine whether they are within the scope of the legislation and familiarise themselves with the obligations for in-scope companies and those who hold interests in them.

New Cayman Islands IP regime
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • Cayman Islands
  • September 07 2017

The Trademarks Law 2016, the Patents and Trademarks (Amendment) Law 2016 and the Design Rights Registration Law 2016 recently came into force, introducing a new IP regime in the Cayman Islands. The legislation establishes a standalone trademark registration system, prohibits the assertion of patent infringement in bad faith and allows existing UK and EU-registered design rights to be extended to the Cayman Islands, among other things.

BVI exempts certain categories of people from work permit requirements
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • British Virgin Islands
  • September 07 2017

The government recently enacted the Labour Code (Work Permit Exemption) Order 2017, which excludes certain categories of people from the need to obtain work permits. In particular, the exemption for directors visiting the British Virgin Islands for board meetings supports the territory's position as the leading corporate domicile in the global economy.

Pacific Andes saga: forum shopping, Chapter 11 and just and equitable winding up
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • British Virgin Islands
  • August 31 2017

'Forum shopping' is the practice of choosing the most favourable jurisdiction in which to bring a claim. In principle, there is nothing wrong in seeking to have a case heard in the forum which is most favourable to the client. However, it can lead to some fierce jurisdictional battles, particularly in insolvency, where the choice between debtor and creditor-friendly procedures can be stark. The Commercial Court has been wrestling with this situation over the past 10 months.

Shareholder activism: considerations for BVI companies
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • British Virgin Islands
  • August 24 2017

As the world's leading incorporation vehicles, BVI companies are listed on exchanges and conduct business around the world and may therefore expect to be occasionally involved in activist campaigns or other challenges from shareholders. However, many investors and their advisers may be less familiar with BVI company law than their domestic legislation.

Government raises charter cruising permit fees
Harney Westwood & Riegels
  • Private Client & Offshore Services
  • British Virgin Islands
  • August 17 2017

The government recently enacted two measures regarding the cruising permit fees that each charter boat must pay while carrying paying passengers in the British Virgin Islands. Under the Cruising Permit (Amendment) Act, boats will now be classified as either home-based or foreign-based charter boats, with set fees for each classification. The Statutory Rates, Fees and Charges (Amendment of Schedule) Order 2017 confirms these fees for internal government purposes.

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