BVI Law and Practice Contributed by: Andrew Jowett, Patrick Gill and Jack Igglesden, Appleby
• a director or senior officer of the entity is accus- tomed to acting on the instructions of the person. 3.4 Passporting The BVI is not part of any international passporting regime, so a licence issued by the Commission does not, on its own, create a right to operate in another country. Cross‑border activity instead depends on co-operation arrangements and information‑sharing mechanisms that the Commission maintains with for- eign regulators, rather than any automatic recognition of BVI authorisations. The BVI maintains memoranda of understanding with International Organization of Securities Commissions (IOSCO) members and various foreign regulators to facilitate information exchange and supervisory co- operation. These arrangements enhance cross‑border oversight but do not grant market‑access privileges. The Commission’s involvement with global bodies like FATF and IOSCO informs its regulatory approach, yet firms must still secure local approvals to conduct regulated activities abroad. There are no specific marketing rules for selling virtual asset services cross-border into the BVI from outside of the BVI; however, the virtual asset activity should be assessed as to whether such activity is being carried out “in or from within” the BVI and therefore may be subject to licensing. The BVI has no dedicated financial promotions regime; however, licensees (including VASPs under the VASP Act) are generally subject to general prohibitions and restrictions on marketing material, including making false, misleading or deceptive statements in market- ing materials. Additionally, a VASP that is registered to operate a virtual assets exchange shall not engage in trading or marketing activities in relation to any virtual assets for its own benefit which may be detrimental to the interests of its clients, unless such activities: (i) are necessary for the operation of the virtual assets exchange; and (ii) have been disclosed to its clients prior to engaging in the trading or marketing activities. 4. Cross-Border Services 4.1 Marketing
Notwithstanding, all marketing should be complete, correct and not misleading in any way. 4.2 White Labelling White-label solutions are commonly used in the BVI. A key consideration is whether the entity undertak- ing the relevant activities and providing the underlying service is itself carrying on VASP activities in or from within the BVI. If so, it may require its own registra- tion. It is also important that the non-licensed entity utilising the white-label solutions does not hold itself out as carrying on the VASP activity itself as this might also trigger a VASP registration requirement (where the activities are conducted in or from within the BVI). Care should be taken that, among other things, no words are used, in any language, which connote a virtual asset business in the description or title of the business in question, and that no representation is made in any document or in any other manner that a person is carrying on virtual asset business. Since the VASP Act came into force, the BVI has not enacted separate or additional legislation on DeFi. Each DeFi project must therefore be evaluated based on the asset classes and activities conducted to determine whether it falls within existing licensing requirements. Merely providing ancillary infrastructure to allow another entity to offer their service does not qualify as VASP activity under the VASP Act. 5.2 DeFi Structures The BVI Business Company is the predominant cor- porate vehicle employed for blockchain‑related initia- tives. Its flexible governance and operational frame- work render it particularly suitable for token issuances, digital‑asset custody, operational and development support and participation in DeFi activities. 5. Decentralised Finance 5.1 Ability to Use DeFi While the BVI does not have foundation companies, it is common for decentralised organisations to utilise multi-jurisdictional structures, including a foundation
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