In order to answer the question above, investors should consider many factors such as their budget, purpose, strategy, etc. to select a suitable jurisdiction for their offshore companies. Therefore, this article does not attempt to suggest or guide readers to prefer one jurisdiction to another. This just shows the main different points between BVI and Cayman.
BVI and Cayman Islands are British Overseas Territories. Each jurisdiction has its own government and is responsible for internal self-governing, while the United Kingdom is responsible for external affairs, defense, and courts (both islands have the same legal system).
BVI and Cayman are well-known jurisdictions for offshore companies. Governments have created an open environment and established efficient regulations to attract foreign investors. Offshore companies in BVI and Cayman will receive huge benefits, including:
Read more: Setting up a BVI company from Singapore
However, there are some differences between BVI and Cayman:
The first difference between the two British Overseas Territories comes from the using purposes of offshore companies, especially in terms of secrecy and holding company structure.
People prefer to set up BVI companies to protect the information of shareholders and the board of directors. BVI has the most powerful law when it comes to confidentiality, stakeholders rest assured to open their company in BVI when their information will be protected under the law. The BVI International Business Companies Ordinance 1984 (as amended) contains extended privileges and strict confidentiality requirements for the companies.
On the other hand, Cayman is known as one of the popular jurisdictions for financial regulations. It will be a good choice for funds, banks, wealthy individuals to explore financial opportunities across the border with the Government of the Cayman’s financial license.
The regulatory framework is the second difference between BVI and Cayman. Although both countries require companies to audit their investment funds, BVI does not require companies to follow local audits while Cayman requires companies engaged in funds to be audited on a local level.
Registration requirements to incorporate a company in BVI is faster than Cayman. The process starts from filing the Memorandum and Articles of Association (MAA), and articles signed by the proposed registered agent (the RA - must file its consent to act) to submit copies of MAA, articles and receive a Certificate of Incorporation typically takes within 24 hours in BVI. However, registrants will receive a certification of incorporation and it takes five working days or two working days upon payment of an additional service fee to the government in Cayman.
Furthermore, pre-approved functionalities of investment role licenses issued by China, Hong Kong, Brazil, the US, and the UK are accepted in the BVI, therefore no further approved functionalities required. Whereas, investors in Cayman may spend more time, add more legal fees and expenses to apply for a new regulatory license when the government of Cayman Islands does not grant pre-approved functionalities of investment roles, including managers, administrators, custodians, auditors, etc. issued by other countries. Normally, the process of incorporation maybe takes four to five hours in BVI and one or two days in Cayman.
BVI attracts more investors from Russia, Asia, and BVI is not a bad idea for small business owners who have a limited budget and company privacy is their main concern, and Cayman is a perfect location for big businesses looking for investment opportunities in the fund sector or taking the proposed company as a holding structure in the future and familiar with many institutional investors from US, South America, and Western Europe.
Tax savings, simple registration process, confidentiality, asset protection, and opportunities to go internationally are the main benefits of setting up companies in BVI and Cayman. However, you should consider carefully your needs, purposes, and circumstances to select a country.
Contact our advisory team if you want to get further more information to make a decision by clicking the link https://www.offshorecompanycorp.com/contact-us. Our advisory team will advise you types of British Virgin Islands (BVI) or Cayman companies that fit your business activities. We will check the eligibility of your new company name as well as provide the newest information about the procedure, obligation, taxation policy, and financial year to open an offshore company.
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