BRITISH VIRGIN ISLANDS Trends and Developments Contributed by: Andrew Emery and Mary-Frances Morris, Emery Cooke
whether the joint interest privilege doctrine survives in the trustee-beneficiary context – which are likely to generate further litigation. Sian Participation and the arbitration / insolvency interface The Privy Council’s decision in Sian Participation Corp ( In Liquidation ) v Halimeda International Limited (2024), UKPC 16 continued to cast a long shadow over BVI practice throughout 2025. The Board held that the correct test for staying a winding-up petition where the underlying debt is subject to an arbitration clause is not the broad Salford Estates test – which had previously led courts in England and the BVI to routinely stay such petitions in favour of arbitra- tion – but rather the “genuine dispute on substan- tial grounds” standard applicable to disputed debts more generally. Courts in both England and the BVI are therefore no longer required to stay insolvency proceedings merely because the debt is subject to a generally worded arbitration agreement. This decision has been applied and developed in numerous BVI cases throughout 2025. In Welltech Group Limited , Justice Mithani declined to stay BVI proceedings in favour of LCIA arbitration, holding that the dispute was not within the terms of the nar- row arbitration clause and that, even if it had been, it was not a bona fide dispute raised on substantial grounds. In Spa II Guangdong Ltd v Decent Manage- ment Limited , the court made a liquidation order on just and equitable grounds, accepting that findings in a prior HKIAC (Hong Kong International Arbitration Centre) partial award on functional deadlock and loss of trust and confidence could be carried through to the winding-up application without relitigation, absent a formal challenge to the award. Caldicott Worldwide Ltd v Siong Beng Seng & Ors raised yet another facet of the arbitration and share- holder nexus: whether an arbitration agreement between a company and a shareholder can be used to stay the factual substratum of a shareholder-ver- sus-shareholder unfair prejudice claim. The Court of Appeal granted leave to appeal to the Privy Council in 2025, recognising that this issue has wide-ranging implications for minority shareholder protection. The
Privy Council’s determination is awaited with great interest. Digital asset and cryptocurrency disputes Continuing waves of crypto insolvency The BVI has firmly established itself as the pre- eminent jurisdiction for digital asset insolvency and recovery proceedings. The Three Arrows Capital (3AC) liquidation – one of the largest cryptocurrency fund failures in history – continues to generate complex, multi-jurisdictional litigation in the BVI and beyond. Liquidators appointed by the BVI courts have co-ordi- nated recovery efforts across numerous jurisdictions, deploying freezing orders, Norwich Pharmacal appli- cations and cross-border co-operation mechanisms. The experience accumulated by BVI insolvency prac- titioners and courts in this context has generated a body of jurisprudence and institutional expertise that no comparable offshore jurisdiction can yet match. The FTX collapse similarly generated substantial BVI proceedings, given the number of FTX entities incor- porated in the jurisdiction. Token valuation disputes and market manipulation claims are identified by prac- titioners as the next frontier of crypto litigation: cases challenging the methodologies used to value digital assets, and claims arising from the alleged manipula- tion of token prices by issuers or large-market partici- pants, are expected to reach the BVI courts in increas- ing numbers through 2026 and beyond. Freezing orders against persons unknown In a first for the territory, the BVI Commercial Court granted a worldwide freezing order against persons unknown – individuals allegedly responsible for cybercrime and misappropriation of digital assets – establishing important precedent for the protection of victims of cyber-fraud in the BVI. This development followed similar innovations by the English courts in the crypto context and demonstrates the BVI court’s willingness and capacity to adapt established legal tools to novel technological circumstances. The court also permitted alternative service on unknown respondents, recognising that conventional service mechanisms are inadequate where the identity of the wrongdoer is unknown.
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