BRITISH VIRGIN ISLANDS Trends and Developments Contributed by: Andrew Emery and Mary-Frances Morris, Emery Cooke
The VASP Act 2022, which came into force in February 2023 and requires virtual asset service providers to register with the BVI FSC, has generated its own reg- ulatory compliance issues and associated disputes. The FSC launched a VASP Advisory Committee in March 2025 and its Compliance Inspection Unit began a major round of on-site inspections of higher-risk sector firms in 2025. Regulatory enforcement actions arising from these inspections are likely to generate further satellite litigation in the coming years. Freezing orders against dissolved companies The ECSC Court of Appeal’s decision in Svirsky and Donin v Oyekenoc and Tensigma Limited confirmed that a freezing injunction may be granted against and in relation to a dissolved BVI company and its assets, so long as there is a realistic prospect of the company being restored to the register. The court held that the dissolution of a company and the transfer of its assets may themselves be part and parcel of a dissipation scheme, and that permitting a wrongdoer to achieve immunity from injunctive relief by procuring dissolu- tion would be contrary to justice. This is a practically important development given the large number of BVI companies dissolved following the BCA amendments and fee non-payment sweep of mid-2023. Fraud, asset tracing and large-scale litigation National Bank Trust v Shishkhanov The most significant large-scale fraud proceedings in the BVI in 2025 were those brought by National Bank Trust (NBT) against Shishkhanov and others in claims totalling approximately USD2 billion. On 22 November 2025, Justice Mithani AG handed down judgment dis- missing the jurisdictional challenges brought by four separately represented groups of defendants follow- ing a five-day hearing in October 2025. The defend- ants advanced challenges on the grounds of the necessary or proper party gateway, the tort gateway, forum non conveniens, discretion, and alleged failures of full and frank disclosure. The judge found in favour of NBT on all grounds. The judgment is of significant interest to practitioners in relation to the necessary and proper party gateway, and specifically the question of whether there is a real issue that it is reasonable for the court to try. The case illustrates the BVI court’s continuing capacity and
willingness to handle large-scale, multi-jurisdictional fraud proceedings of global significance. Negative declaratory relief In Phoenix BVI (Mithani J, July 2025), the BVI Com- mercial Court reaffirmed its broad discretionary pow- ers to grant negative declarations where the circum- stances of the case make it appropriate to do so. The case arose from threatened proceedings by liquida- tors that had hung over the defendants for several years without being commenced. The court granted relief in a trial conducted in absentia, underscoring its pragmatic willingness to bring finality to prolonged legal threats that impair commercial activity. Negative declaratory relief is likely to become an increasingly important tool in the BVI’s armoury for managing com- plex cross-border disputes. Norwich Pharmacal and information orders Norwich Pharmacal applications against BVI regis- tered agents, banks and corporate service providers remain among the most frequently sought interim rem- edies in the jurisdiction. The utility of the BVI as a hub for information orders is enhanced by the concentra- tion of holding companies and nominee arrangements in the jurisdiction, making BVI entities a critical node in international asset tracing exercises. The 2023 CPR changes, and the removal of the permission require- ment for service out of the jurisdiction, have simplified the procedural pathway for pursuing such orders, and the volume of applications continued to grow through- out 2025. Sanctions and access to justice UK sanctions imposed in response to Russia’s inva- sion of Ukraine are extended to the BVI by Orders in Council, and they continue to create some of the most complex and practically challenging issues in BVI litigation. The fundamental tension is between the sanctions regime – which prohibits the provision of legal, financial and other services to designated entities – and the requirements of natural justice and access to the courts. Sanctioned parties who are defendants in BVI proceedings face severe difficulties in instructing lawyers or engaging with the litigation. Cases effectively frozen pending licence applications or geopolitical developments have accumulated in the Commercial Court’s list.
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