Legislation Passed to Permit Waiver of Stamp Duty on Internal Reorganization of Companies

Where a BVI company which owns land in the BVI is deemed to be under 'Non-Belonger Control' any transfer of property by that company is liable to stamp duty pursuant to the provisions of the Non-Belongers Land Holding Act.

The Act was amended in 1994 to provide for relief from stamp duty in a number of cases where there was no "arms length bargain" including cases where shares in the company, or property owned by the company, were being transferred to the spouse, children or grandchildren of the existing owner or to a trust for their benefit. Transfers of property within a group during the course of a reorganisation were not however exempted.

The Act was further amended on August 18, 1998 to provide that the Governor could grant an exemption from the payment of stamp duty where the company wishes to transfer property to another company which had the same beneficial ownership. The exemption is not automatic however and it will be necessary for an application to be made showing cause why the discretion should be exercised.