37B.

In this Part

“authorised custodian” means a person approved by the Commission as an authorised custodian under section 50A(1) or section 50A(2) of the Financial Services Commission Act, 2001;

“custodian” means an authorised custodian or a recognised custodian;

“existing bearer share” means a share in a company that was issued as or converted to a bearer share prior to the effective date and that remains a bearer share in the company on the effective date; and

“recognised custodian” means a person recognised by the Commission as a custodian under section 50B of the Financial Services Commission Act, 2001. 

37C.

(1)

During the period in which a bearer share is disabled, that share does not carry any of the entitlements which it would otherwise carry and, subject to subsection (3), any transfer or purported transfer of an interest in the bearer share is void and of no effect.

(2)

Without limiting subsection (2), “entitlement” includes an entitlement to vote, an entitlement to dividend and an entitlement to a share in the assets of the company on its winding up or on its dissolution. 

(3)

Subsection (1) does not apply to the transfer or delivery of a bearer share in a company

(a)

to a custodian in accordance with this Part;

(b)

to the company where the share is to be, or has been

(i)

converted to, or exchanged for, a registered share,

(ii)

redeemed, purchased or otherwise acquired by the company, or

(iii)

forfeited and cancelled,

and the company does not hold the bearer share for or on behalf of any other person; or

(c)

to the registered agent of a company in accordance with section 37I(1)(c), 37I(4)(b) or 37J(2).

37D.

(1)

Where a company issues a bearer share, or disposes of a treasury share that is a bearer share, on or after the effective date, it shall not deliver the share to any person other than a custodian who has agreed to hold the share. 

(2)

A company shall not, on or after the effective date, deliver a bearer share converted from a registered share to any person other than a custodian who has agreed to hold the share.

37E.

(1)

Every existing bearer share of a company shall, on or before the transition date

(a)

be deposited with a custodian who has agreed to hold the share; or

(b)

be converted to, or exchanged for, a registered share.

(2)

Subsection (1) does not apply to a bearer share that, before the transition date

(a)

is cancelled; or

(b)

is redeemed, purchased or otherwise acquired by the company as a treasury share. 

(3)

An existing bearer share in a company is deemed not to have been deposited with a custodian for the purposes of subsection (1) until the registered agent of the company has received

(a)

in the case of a bearer share deposited with an authorised custodian, notification of the deposit from the authorised custodian in accordance with section 37H(1); or

(b)

in the case of a bearer share deposited with a recognised custodian, the proof of the deposit of the share and the notice required to be sent by section 37G(3). 

(4)

The Court may, on the application of the company or of a person interested in a bearer share, extend the period specified in subsection (1) by such further period or periods not exceeding one year in total as it considers fit. 

(5)

↑ Back to top

37F.

(1)

Subject to subsections (2), (3) and (4), a bearer share in a company is disabled for any period during which it is held by a person other than a custodian. 

(2)

Subsection (1) shall not have effect with respect to an existing bearer share until after the transition date. 

(3)

Subject to section 37J(7), subsection (1) does not apply to a bearer share in a company

(a)

that is held by the registered agent of the company under section 37I(1)(c), 37I(4)(b) or 37J(2); or

(b)

that is held by a person who received the share at a time when he was a custodian but who has ceased to be a custodian.

(4)

Subsection (1) does not apply where

(a)

a bearer share in a company is held by the company;

(b)

the bearer share is to be, or has been

(i)

converted to, or exchanged for, a registered share,

(ii)

redeemed, purchased or otherwise acquired by the company, or

(iii)

cancelled and forfeited; and

(c)

the company does not hold the bearer share for or on behalf of any other person. 

37G.

(1)

Where a bearer share in a company is delivered to or deposited with an authorised custodian, the company, where it delivers the share, or the authorised custodian delivering or the person depositing the share, shall provide the authorised custodian with a notice in the prescribed form

(a)

stating the full name of the beneficial owner of the bearer share;

(b)

stating the full name of any other person having an interest in that share, whether by virtue of a charge on the share or otherwise, or containing a statement that no other person has an interest in that share; and

(c)

containing such other information as may be prescribed.

(2)

An authorised custodian shall not accept a bearer share unless it is accompanied by a notice complying with subsection (1). 

(3)

Where a bearer share in a company is delivered to or deposited with a recognised custodian, the company, where it delivers the share, or the person depositing the share shall, within 14 days of the date on which the share is delivered or deposited with the recognised custodian, send to the registered agent proof, in such form as may be prescribed, of the delivery or deposit of the share and a notice in the prescribed form containing the information specified in paragraphs (1), (b) and (c) of subsection (1). 

37H.

(1)

An authorised custodian shall, within 14 days of the receipt of a bearer share in a company that is delivered to it, other than by the registered agent of the company, or deposited with it, send notification to the registered agent of the company that it is the custodian of the share. 

(2)

An authorised custodian who holds a bearer share

(a)

shall keep the notice provided to it under section 37G(1), any notice filed under section 37K(1), any notice sent to the registered agent under section 37M(1) or(4) and a record of the location of the bearer share

(i)

in the case of an authorised custodian approved under section 50A(1) of the Financial Services Commission Act, 2001 at its principal office in the British Virgin Islands or at such other office in the British Virgin Islands as may be approved by the Commission in writing; or

(ii)

in the case of an authorised custodian approved under section 50A(2) of the Financial Services Commission Act, 2001, at such office as may be approved by the Commission in writing; and

(b)

whether the bearer share is kept inside or outside of the British Virgin Islands, shall ensure that the bearer share remains at all times within its custody and control.

(3)

↑ Back to top

37I

(1)

An authorised custodian holding a bearer share in a company shall not transfer possession of that share to any person other than

(a)

another authorised custodian who has agreed to hold the share,

(b)

the company where the bearer share is to be, or has been

(i)

converted to, or exchanged for, a registered share,

(ii)

redeemed, purchased or otherwise acquired by the company,  or

(iii)

cancelled and forfeited; or

(c)

the registered agent of the company. 

(2)

Where an authorised custodian transfers possession of a bearer share in accordance with subsection (1), it shall

(a)

make a copy of all notices provided to it under section 37G(1) or section 37K(1) and any notices sent to the registered agent under section 37M(1) or (4) and retain the copies made for such period as may be prescribed; and

(b)

Deliver, with the bearer share, all original notices provided to it under section 37G(1) or section 37K(1) and copies of any notices sent to the registered agent under section 37M(1) or (4).

(3)

Where an authorised custodian transfers possession of a bearer share in a company to another authorised custodian or to the company, it shall, within 7 days, send a notice of transfer in the prescribed form to the registered agent of the company.

(4)

A recognised custodian shall not transfer possession of a bearer share in a company to any person other than

(a)

the company where the bearer share is to be, or has been

(i)

converted to, or exchanged for, a registered share,

(ii)

redeemed, purchased or otherwise acquired by the company, or

(iii)

cancelled and forfeited; or

(b)

the registered agent of the company.

(5)

Where a recognised custodian transfers possession of a bearer share in a company, it shall deliver, with the bearer share, a copy of any notice sent to the registered agent under section 37M(1) or (4). 

(6)

Where possession of a bearer share in a company is transferred by a recognised custodian to the company, the company shall, within 14 days of the receipt of the share, send notification of its receipt of the share to its registered agent. 

(7)

The registered agent of a company shall not transfer possession of a bearer share in the company to any person other than

(a)

a custodian who has agreed to hold the share, or

(b)

the company where the bearer share is to be, or has been

(i)

converted to, or exchanged for, a registered share,

(ii)

redeemed, purchased or otherwise acquired by the company, or

(iii)

cancelled and forfeited. 

(8)

Where a registered agent transfers possession of a bearer share received from an authorised custodian to an authorised custodian, he shall

(a)

make a copy of all notices provided to him under subsection (2)(b) and retain the copies made for such period as may be prescribed; and

(b)

deliver, with the bearer share,

(i)

the original notices, and

(ii)

any copies of notices,

received under subsection (2)(b).

37J.

(1)

Where the Commission revokes the approval of an authorised custodian or ceases to recognise a person as a recognised custodian, it shall

(a)

publish a notice in the Gazette and in a newspaper published and circulating in the Virgin Islands; and

(b)

send a notice to the person whose approval has been revoked or who has ceased to be recognised.

(2)

A person whose approval as an authorised custodian has been revoked or who has ceased to be recognised by the Commission as a recognised custodian shall, in respect of each bearer share in a company that he holds,

(a)

forthwith give the registered agent of the company, the beneficial owner of the share and any person who has an interest in that share notice in the prescribed form that he has ceased to be an authorised or recognised custodian; and

(b)

deliver to the registered agent of the company, within 14 days of his ceasing to be a custodian,

(i)

the bearer share in the company; and

(ii)

all original notices provided to him under section 37G(1) or section 37K(1) and a copy of any notice sent to the registered agent under section 37M(1) or (4).

(3)

A registered agent of a company who receives a bearer share in a company under subsection (2), shall hold the share on behalf of the beneficial owner of the share and shall only transfer possession of that share in accordance with instructions received under subsection (4) or, if he does not receive such instructions within the time period specified in subsection (4), in accordance with subsection (5).

(4)

The beneficial owner of a bearer share received by a registered agent under subsection (1) or  (4) shall, within 90 days of the date of publication in the Gazette of a notice under subsection (1)(a), provide the registered agent with written instructions as to the transfer of possession of the share to

(a)

a custodian who has agreed to hold the share; or

(b)

the company where the bearer is to be, or has been

(i)

converted to, or exchanged for, a registered share,

(ii)

redeemed, purchased or otherwise acquired by the company, or

(iii)

cancelled and forfeited.

(5)

 If the registered agent does not receive instructions from the beneficial owner of a bearer share complying with subsection (4) within the time period specified in subsection (4), the registered agent shall transfer possession of the share to such authorised custodian as he considers fit.

(6)

Where a registered agent fails to transfer possession of a bearer share in accordance with subsection (5), the Commission may apply to the Court for an order that the bearer share be disabled, notwithstanding section 37F(3).

(7)

On an application made under subsection (6), the Court may make such order as it considers appropriate. 

(8)

A registered agent commits an offence and is liable on summary conviction to a fine of $10,000 if he

(a)

transfers possession of a bearer share otherwise than in accordance with instructions received in accordance with subsection (4); or

(b)

fails to transfer possession of a bearer share in accordance with subsection (5).

37K.

(1)

A transfer of the beneficial ownership of, or an interest in, a bearer share held by an authorised custodian is not effective until a notice in the prescribed form amending the notice provided under section 37G(1) is submitted to the authorised custodian.

(2)

↑ Back to top

37L.

(1)

Where an existing bearer share in a company is not deposited with a custodian who has agreed to hold the share on or before the transition date, the company may, notwithstanding section 33(1A) or any provision in the memorandum or articles, in any shareholders’ agreement or in any other agreement, redeem the shares. 

(2)

Subject to subsection (3), sections 81(3) and 83 apply to the redemption of bearer shares under subsection (1).

(3)

Where a company is unable, on making reasonable enquiries, to ascertain the identity or address of the holder of a bearer shares

(a)

it is not required to give the member notice under section 81(3); and

(b)

the company shall hold the proceeds of redemption on trust for the owner of the bearer share.

37M.

(1)

The custodian of a bearer share in a company may deliver to the registered agent of the company a notice specifying the name and address of the person who is to be regarded as having the right to those entitlements carried by the share that are specified in the notice. 

(2)

A notice under subsection (1) may extend to all the entitlements carried by the share and may be limited to certain specified entitlements, including the right to vote at meetings of the company generally or to vote at a specified meeting of the company. 

(3)

Subject to sections 37C and 37F, where the registered agent of a company receives a notice under subsection (1) that has not been revoked, notwithstanding that the bearer share is in the custody of a custodian, the company shall treat the person specified in the notice as the bearer of the share for the purposes of the entitlements carried by the share that are specified in the notice.

(4)

The custodian of a bearer share may by written notice delivered to the registered agent of the company, revoke a notice delivered under subsection (1).

(5)

A notice of revocation under subsection (4) takes effect from the time that the notice is received by the registered agent or at such later time as may be specified in the notice. 

37N.

(1)

Where, after the transition date, a company has one or more existing bearer shares that have not been deposited with a custodian in accordance with this Part, the Commission may apply to the Court for the winding up of the company under the Companies Act. 

(2)

Section 97 applies to any application by the Commission to wind up a company under this section.

37O.

Without limiting section 112, regulations may provide that where

(a)

notice is required or permitted to be given by a custodian, or former custodian, to the beneficial owner of a bearer share or to any person who has an interest in a bearer share, or

(b)

instructions are required or permitted to be given by the beneficial owner of a bearer share in a company to a custodian, or former custodian, or to the registered agent of the company,

↑ Back to top