BVI extending the ability to reseal foreign grants of probate and administration in the territory to numerous other jurisdictions
Background
The BVI’s earlier Probates (Resealing) Act, which was enacted in the 1930s, enabled a simplified procedure to be followed in circumstances in which grants of probate or letters of administration had been issued by the courts of certain other jurisdictions i.e. by enabling such grants to be resealed by the BVI court so that the resealed grant has the same effect as if it had been granted by the court itself.
The simplified procedure itself is set out in the BVI’s Supreme Court Non-Contentious Probate Rules (the ‘Probate Rules’) which were made pursuant to both section 7 of the Resealing Act and section 17 of the UK Supreme Court Order 1967 (SI 1967 No. 223). The Probate Rules provide, amongst other things, that significantly fewer documents than would be needed for the purposes of a fresh application for a grant of representation need to be filed with the court and that only one newspaper advertisement need be taken out, thereby expediting the process.
The former Probates (Resealing) Act only applied to grants issued by courts of probate in ‘[Her][1]Majesty’s dominions.’ The term [Her] Majesty’s dominions’ was defined by the Act to include to ’any British protectorate or protected state and any territory in respect of which a mandate or trusteeship is being exercised by Her Majesty’s Government in the United Kingdom or the Government of any part of Her Majesty’s dominions; the word ‘dominions’ was additionally defined by section 2 of the Interpretation Act (as amended by the Interpretation (Amendment) Act, 2014) to include ‘all territories which belong to the Crown or are in the ownership of the Crown including Canada, Australia and New Zealand’[2].
A comprehensive new Probate (Resealing) Act has now been enacted which replaces the earlier statute. This reform has been made since provisions of the latter were quite limited and did not enable grants issued, say, from the many other English common law jurisdictions which were not regarded as belonging to the Crown to be resealed in the BVI. It was not for instance previously possible to reseal in the BVI grants which had been issued by the authorities in India, Singapore, South Africa or (unless the grant was issued prior to 1 July 1997) Hong Kong. Nor until the new reforms took effect was it possible to reseal US or Channel Islands grants in the Territory.
Review by STEP’s Trust and Succession Law Review Committee
The Trust and Succession Law Review Committee of the BVI Branch of the Society or Trust and Estate Practitioners (STEP) considered the prevailing legislation in a number of jurisdictions and, in particular, that in the United Kingdom and those common law jurisdictions with which the BVI competes for the provision of financial services.
After careful consideration, the view, which is reflected in the amended legislation, was taken that the ability to reseal grants should be generally extended to jurisdictions to which the English Colonial Probates Act, 1892 applies and that there should be no requirement in the new BVI statute (equivalent to that in the English statute) to the effect that reciprocity is required.
Additionally, grants issued by the Crown Dependencies, various states of the United States of America, and India will be capable of being resealed in the Territory. Significantly, given the number of BVI companies which have as their shareholders individuals, resident in Hong Kong, Hong Kong grants will now be capable of being resealed in the BVI regardless of when they were issued.
The new Probates (Resealing) Act, which came into force on 9 July 2021, in general, permits grants issued from the authorities of the following jurisdictions to be resealed in the BVI:
Jurisdictions from which grants will be capable of being resealed
- Alberta
- Anguilla
- Antigua and Barbuda
- Australia (including each of its Provinces)
- Bahamas
- Barbados
- Belize
- Bermuda
- Botswana
- British Antarctic Territory
- British Columbia
- British Sovereign Base Areas in Cyprus
- Brunei
- Canada (and each of its Provinces other than Quebec)
- Cayman Islands
- Christmas Islands (Australia)
- Cocos (Keeling) Islands
- Cyprus (Republic)
- Dominica
- England and Wales
- Falkland Islands
- Falkland Islands Dependencies
- Fiji
- Gambia
- Ghana
- Gibraltar
- Grenada
- Guernsey
- Guyana
- Hong Kong (including The Hong Kong Special Administrative Region of the People’s Republic of China)
- Isle of Man
- India
- Jamaica
- Jersey
- Kenya
- Kiribati
- Lesotho
- Malawi
- Malaysia
- Montserrat
- Nevis
- New Guinea Territory
- New Zealand
- Nigeria
- Norfolk Island
- Northern Ireland
- Papua New Guinea
- Helena
- Kitts
- Lucia
- Vincent
- Scotland
- Seychelles
- Sierra Leone
- Singapore
- Solomon Islands
- South Africa
- Sri Lanka
- Swaziland
- Tanzania
- Trinidad and Tobago
- Turks and Caicos Islands
- Tuvalu
- Uganda
- United States of America (including the District of Columbia)
- Zambia
- Zimbabwe
The Minister is also to be given the power to add jurisdictions and remove them from the above list.
Whenever consideration is given to the question of resealing, in the BVI, a grant issued by a jurisdiction in which the testator was not actually domiciled at the time of his or her death, the provisions of Rule 30 (7) of the Probate Rules may need to be considered and this is an issue on which O’Neal Webster can advise.
Conclusion
Now that the new Resealing Act has come into force, the many shareholders of the substantial number of BVI companies in existence can take comfort from the fact that a simplified procedure may well apply to the transfer of their shares to their heirs when they pass away. It is nevertheless always recommended that shareholders of BVI companies should consider the establishment of a trust. If properly structured the establishment of a lifetime BVI trust should avoid the need to apply for a grant of representation altogether and tends to make matters much smoother, also avoiding unnecessary costs, delays and the public filings which an application for probate or letters of administration involves. Shareholders might be wise, in particular, to consider the establishment of a VISTA trust, since the BVI’s Virgin Islands Special Trusts Act, 2003 creates a bespoke and highly popular trust regime which enables such companies to continue to be run by the settlor (or those selected by the settlor), as directors, free from inappropriate interference by the trustee-shareholder whilst at the same time avoiding the need to apply for a grant when the settlor passes away.
In the event that a shareholder does not wish to set up a trust, consideration should be given to the preparation of a will and, if relevant, making use of the ‘reserve director’ provisions in the BVI Business Companies Act, 2004 which reduced the complications and expenses which can arise when a person who is both the sole director and the sole shareholder of a BVI company dies.
The Trust and Succession Law Review Committee of the BVI Branch of STEP, the recommendations of which led to the new Resealing Act, is chaired by O’Neal Webster Partner Chris McKenzie and was formerly chaired by O’Neal Webster Managing Partner Vanessa King who still serves on the Committee. Vanessa is also chair of the BVI Branch of STEP and was recently elected as chair of STEP’s Caribbean and Latin America Regional Committee.
If you would like any further information about these reforms, please contact your O’Neal Webster adviser.
[1] The Resealing Act was passed in the reign of King George VI and so it would have referred to ‘His’ Majesty’s dominions albeit that the version published in the Laws of the Virgin Islands Revised Edition 1991 refers to ‘Her’ Majesty’s dominions.
[2] As a result of section 3(1)(a) of the Interpretation Act this definition applies to the use of this term in statutes which came into effect before or after the relevant provisions of the Interpretation Act came into effect.
