Disposal of assets by a BVI company

Directors of BVI companies have wide ranging powers to manage the company pursuant to the BVI Business Companies Act, 2004 (as amended, the BCA). Under section 109 of the BCA, the business and affairs of the company are managed by, or under the direction or supervision of, the directors of the company. Section 109 of the BCA also provides that the directors have all the powers necessary for managing, directing and supervising the business and affairs of the company.

However, there are certain matters that are specifically reserved for shareholders under the BCA and Section 175 of the BCA provides an important safeguard for shareholders which prevents the disposal of more than 50% of a company’s assets without the approval of its shareholders. The recent case of Fang Ankong and Green Elite Limited (in Liquidation) provides some useful clarification around the BVI court’s willingness to use section 175 as protection for members’ rights, which directors should be alive to when considering a disposal of company assets.

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