STATEMENT FROM THE GOVERNMENT OF THE VIRGIN ISLANDS
TO THE LATEST EUROPEAN UNION LIST OF NON-COOPERATIVE JURISDICTIONS
FOR TAX PURPOSES
Following a meeting of the Council of the European Union on 14 February 2023, the British Virgin Islands (BVI) has been added to the EU list of non-cooperative tax jurisdictions (Annex I). In a statement, the EU Council found that the BVI was not sufficiently in compliance with the OECD standard on exchange of information on request (criterion 1.2). It also noted that this is the first time the BVI has been included in the list.
The British Virgin Islands (BVI) is committed to complying with evolving international standards on transparency and the fight against financial crime.
Legislative changes (including BVI Business Companies Amendment Act 2022, and BVI Business Amendment Regulations 2022) made in 2022 and which came into force on 1 January 2023, evidence the steps put in place to meet requirements set out by the Organisation for Economic Co-operation and Development (OECD) Global Forum on Transparency and Exchange of Information for Tax Purposes as part of its Peer Review Process.
These key legislative developments were not recognised in the most recent OECD Peer Review rating given to the BVI in November 2022, which moved BVI from ‘largely compliant’ to ‘partially compliant’. As a ‘largely compliant’ rating is one of the criteria that determines the “EU List of Non-cooperative Jurisdictions for Tax Purposes” (EU List), the BVI has been added to Annex I as a formality and matter of process.
This is noted by the EU Council which states that this is the ‘first time’ the BVI has been included in the EU list (Annex I) and reflects the compliance process of the ‘OECD standard on exchange of information on request (criterion 1.2)’.
As such, the BVI Government has requested that a supplementary review be granted by the OECD Global Forum that will more accurately reflect the BVI’s current legislative status. Following a supplementary review, the BVI is hopeful that a “largely compliant” rating will be reinstated. This should then ensure the BVI is moved back to Annex II of the EU List, reflecting jurisdictions that have committed to implementing reforms.
The BVI is a world-class international financial centre, committed to high international standards on transparency and regulation and offering a premier business-friendly jurisdiction facilitating global investment and trade.