BVI Broadens Beneficial Ownership Exemption for Foreign Trustees

In a significant regulatory development, the British Virgin Islands (BVI) has expanded its beneficial ownership exemptions by introducing a new foreign trustee exemption, significantly easing reporting burdens for certain corporate structures.

The key amendment resides in the newly enacted British Virgin Islands Business Companies and Limited Partnerships (Beneficial Ownership) (Amendment) Regulations 2025, which came into effect on 1 July 2025. The reforms notably enhance exemptions for legal entities whose shares are held in trust by foreign trustees with anti-money laundering (AML) regulation in their home jurisdiction.

What does the foreign trustee exemption mean?

Previously, BVI-based companies were required to consistently register and maintain records of beneficial ownership with the Registrar of Corporate Affairs. Under the new amendment, however, if these companies are held in trust by a trustee regulated for AML purposes outside the BVI, they are no longer required to file beneficial ownership information, provided the trustee can produce compliant records within 24 hours upon request.

The amendment aligns with existing exemptions, including:

• Subsidiaries of funds (including foreign ones), provided the fund maintains BO data;
• Subsidiaries of publicly listed companies;
• Entities majority-owned (>50%) by governments.

By extending exemptions to foreign trustees, the BVI preserves its attractiveness to global trust structures without compromising transparency—so long as foreign trustees remain subject to robust AML oversight.

Context and timeline

This update caps a consultation process initiated in January 2025, which introduced a “legitimate interest” framework governing access requests to beneficial ownership information. The policy was finalized on 23 June 2025, and the regulations were enacted on 1 July 2025. Notably, the new “legitimate interest” access regime won’t become fully functional until April 2026, allowing time for procedural alignment.

Persons requesting BO information from the Registrar must submit their requests electronically, including proof of legitimate interest. The Registrar then has 12 business days to issue a decision, and targets have five days to object. Firms can apply for permanent exemptions beginning 1 January 2026.

What this means for practitioners

• Trust advisors and corporate service providers should verify that foreign trustees are AML-regulated and establish reliable record systems capable of meeting the 24-hour provision requirement.
• Compliance officers should monitor the strict timeline for legitimate interest requests—and ensure firms are ready for the April 2026 rollout.
• Clients which rely on foreign trustee structures can benefit from reduced disclosure obligations, though they must still adhere to international AML standards.

Verdict: The new foreign trustee exemption underscores the BVI's pragmatic balance: maintaining legitimate confidentiality while ensuring enhanced global regulatory alignment. SFM will continue monitoring how such developments influence international trust structuring.