BVI Approved Fund Managers and Their Ongoing Obligations

The Approved Fund Manager regime in the British Virgin Islands, which has been in force since 2012, has found tremendous success with fund managers, globally. The regime is particularly attractive for start-ups, but also well suited for established small and medium-sized funds. It is employed to manage funds in the BVI, other offshore jurisdictions, and in leading onshore jurisdictions.

In a nutshell, the approved manager regime permits a BVI company or partnership to conduct business as an investment manager for certain funds without a lengthy approval process. It also provides a lighter touch regulatory regime, reducing documentation and associated costs.

Approved Manager Advantages

Since 2012, fund managers have benefited from the regime’s many advantages, including:

  • A quick setup process, where a fund manager can commence business seven days after applying
  • Fast track approval processes, where an applicant for approved manager status can typically expect approval within two weeks of application
  • An easy and straightforward process for the prospective fund manager to complete and submit a standard application form and supporting documents, noting that the document burden is not onerous
  • Lighter regulations and filings despite the approved manager being a regulated entity
  • Lower cost to set up, making it ideal for startup and small to medium-sized managers

Eligibility for Approved Manager Status under the Regime

To be eligible for approved manager status, the entity must:

  • Be a BVI company or partnership
  • Manage or intend to manage a BVI private or professional fund
  • Manage or intend to manage a BVI closed-ended fund
  • Manage or intend to manage a fund from any recognised jurisdiction* that has equivalent characteristics to a BVI private or professional fund
  • Have assets under management of not more than US $400 million in respect of open-ended funds and of not more than US $1 billion for closed-ended funds

* Recognised jurisdictions include Argentina, Australia, Bahamas, Bermuda, Belgium, Brazil, Canada, Cayman Islands, Chile, China, Curacao, Denmark, Finland, France, Germany, Gibraltar, Greece, Guernsey, Hong Kong, Ireland, Isle of Man, Italy, Japan, Jersey, Luxembourg, Malta, Mexico, Netherlands, New Zealand, Norway, Panama, Portugal, Singapore, Spain, South Africa, Sweden, Switzerland, United Kingdom, and the United States of America.

Obtaining Approved Manager Status

To become an approved manager, the entity must apply to the BVI Financial Services Commission (FSC) for approval at least seven days before its intended start of business. Upon submission of a completed application, and if the entity meets the basic eligibility requirements, it can conduct business as an approved manager for up to 30 days while waiting for approval. This period can be extended for another 30 days by the FSC, if necessary. Although the FSC commits to considering and approving appropriate applications within the initial 30-day period, typically the process is completed within two weeks.

Certain supporting documents must accompany an application for approved manager status. They include:

  • A copy of the entity’s constitutional documents
  • The details of each principal (i.e., director, senior officer, etc.), and of each major owner (i.e., person or persons holding a significant interest in the manager)
  • A written declaration by the entity that each principal and person holding a significant interest is fit and proper
  • The number and details of the funds for which the manager intends to act
  • The date the manager intends to commence business
  • A copy of the investment advisory or investment management agreement between the manager and the funds for which the manager will act
  • Written confirmation as to which individual will be carrying out the day-to-day investment business functions of the manager
  • Details of any delegation of its business functions
  • Written confirmation from the entity’s legal practitioner
  • A declaration of completeness of the application

In addition, the entity must pass the FSC’s “fit and proper” test, and the FSC must also be satisfied that it would not be contrary to the public interest to grant the approval. It should be noted that the approved manager has no obligation to have an auditor or compliance officer, or to establish and maintain a compliance procedures manual, although some still do.

Permitted Business of an Approved Manager

An approved manager is permitted to act as an investment manager or investment adviser to any of the following:

  • BVI private or professional funds
  • BVI closed-ended funds (including trusts) with characteristics of a BVI private or professional fund
  • An affiliate of any of the fund structures referred to above
  • Such other persons approved by the FSC on a case by case basis
  • Any fund from any recognised jurisdiction that has equivalent characteristics to a BVI private or professional fund (see recognised jurisdictions above)

Regulatory Status

The approved manager is subject to FSC oversight and is treated like any other licensee for the purpose of the Financial Services Commission Act, 2001. Therefore, the approved manager is subject to the powers available to the FSC under that Act.

Ongoing Obligations of the Approved Manager
As a regulated entity, the approved manager has the following obligations:

  • Two directors. The approved manager must have at least two directors, one of whom must be an individual. In the case of an approved manager constituted as a limited partnership, such partnership must, at all times, have at least one general partner.
  • Authorised representative. The approved manager must maintain an “authorised representative” in the BVI, which is a person or entity licensed in the BVI to act as a liaison between the manager and the FSC.
  • Annual financials. The approved manager must submit annual financial statements, and, where necessary, ensure that the notes to the financial statements give a true and fair view of the matters to which they relate. The financial statements do not require an audit. Financial statements must be submitted to the FSC within six months of the end of the financial year to which they relate and must comply with prescribed accounting standards. Financial statements must be signed by a director, or, in the case of a partnership, a general partner of the approved manager. Statements must be accompanied by a director’s certificate, a report on the affairs of the approved manager made in respect of the relevant financial year, and any other documents that may be prescribed by the Investment Business (Approved Managers) Regulations, 2012 (the Regulations). If justified, an approved manager can submit an application for an exemption from preparing and submitting financial statements.

Annual financial statements must comply with any one of the following:

  • International Financial Reporting Standards (IFRS)
  • UK Generally Accepted Accounting Principles (GAAP)
  • Canadian GAAP
  • Internationally recognised and generally accepted accounting standards “equivalent to” the standards above, as determined by the directors and approved by the FSC

Basic annual returns must be filed by the manager with the FSC no later than January 31st of each year in the prescribed form and include:

  • Confirmation statement that it is not in breach of the requirements of the Regulations that entitle it to continue as an Approved Manager
  • Confirmation that each director and senior officer of, and shareholder with a significant interest in, the approved manager is fit and proper
  • Details in respect to December 31st of the preceding year, regarding:
    • the persons for which it provides services;
    • the assets under management of each person for which it acts;
    • the number of investors in each person for which it acts; and
    • any significant complaints received by the approved manager.

Other general obligations require the approved manager to notify the FSC when assets under management in open-ended funds exceed $400 million, or $1 billion in respect of closed-ended funds. The FSC must also be notified in writing of any changes to the information originally submitted in its application along with all relevant details. The notification should be made within fourteen days of the change and must be accompanied by a written declaration stating whether the change complies with the requirements of the Regulations. An approved manager is also required to notify the FSC of any matter related to the approved manager or the approved manager’s conduct of its relevant business activities which may have a material impact or significant regulatory impact on the approved manager or its relevant business. 


With over 300 BVI approved fund managers set up since 2012, their impact on the investment funds industry is noteworthy. Notwithstanding, BVI regulators continue to look for ways to refine and improve the regime. From this standpoint, it is clear that the BVI approved manager regime is moving from strength to strength, and will continue to support the multi-billion-dollar global investment funds space in a meaningful way.


The author, Christopher Simpson, is a partner practicing in O’Neal Webster’s Corporate and Commercial and Funds and Regulatory departments. His practice encompasses corporate and commercial transactions, investment funds, and banking and finance. He advises a client base of leading financial institutions, funds, corporations, and law firms on all aspects of BVI corporate finance including joint ventures, initial public offerings, private placements, mergers, arrangements, corporate restructuring, bilateral and syndicated loans, bond issues, property financing, project finance, special purpose vehicles, investment funds, and general aspects of corporate law. His expertise also extends to investment business and regulatory matters. Contact Christopher for further information on BVI approved fund managers at or +1 284-393-5800.


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