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BVI Business Companies Act, 2004

BVI Company Formations bvi-business-companies-act-2004 previous companies actnext companies act

Division 4 – Capacity and Powers

27. A company is a legal entity in its own right separate from its members and continues in existence until it is dissolved.

28. (1) Subject to this Act, any other enactment and its memorandum and articles, a company has, irrespective of corporate benefit,

(a) full capacity to carry on or undertake any business or activity, do any act or enter into any transaction; and

(b) for the purposes of paragraph (a), full rights, powers and privileges.

(2) Without limiting subsection (1), subject to its memorandum and articles, the powers of a company include the power to do the following:

(a) unless it is a company limited by guarantee or an unlimited company that in either case is not authorised to issue shares

(i) issue and cancel shares and hold treasury shares,

(ii) grant options over unissued shares in the company and treasury shares,

(iii) issue securities that are convertible into shares, and

(iv) give financial assistance to any person in connection with the acquisition of its own shares;

(b) issue debt obligations of every kind and grant options, warrants and rights to acquire debt obligations;

(c) guarantee a liability or obligation of any person and secure any of its obligations by mortgage, pledge or other charge, of any of its assets for that purpose; and

(d) protect the assets of the company for the benefit of the company, its creditors and its members and, at the discretion of the directors, for any person having a direct or indirect interest in the company.

(3) For the purposes of subsection (2)(d), the directors may cause the company to transfer any of its assets in trust to one or more trustees, each of which may be an individual, company, association, partnership, foundation or similar entity and, with respect to the transfer, the directors may provide that the company, its creditors, its members or any person having a direct or indirect interest in the company, or any of them, may be the beneficiaries of the trust.

(4) The rights or interests of any existing or subsequent creditor of the company in any assets of the company are not affected by any transfer under subsection (3), and those rights or interests may be pleaded against any transferee in any such transfer.

29. (1) No act of a company and no transfer of an asset by or to a company is invalid by reason only of the fact that the company did not have the capacity, right or power to perform the act or to transfer or receive the asset.

(2) Subsection (1) does not apply with respect to a restricted purposes company.

30. Subject to section 108, no director, agent or voluntary liquidator of a company is liable for any debt, obligation or default of the company, unless specifically provided in this Act or in any other enactment, and except in so far as he may be liable for his own conduct or acts.

31. (1) A company or a guarantor of an obligation of a company may not assert against a person dealing with the company or with a person who has acquired ssets, rights or interests from the company that

(a) this Act or the memorandum or articles of the company has not been complied with;

(b) a person named as a director in the company’s register of directors

(i) is not a director of the company,

(ii) has not been duly appointed as a director of the company, or

(iii) does not have authority to exercise a power which a director of a company carrying on business of the kind carried on by the company customarily has authority to exercise;

(c) a person held out by the company as a director, employee or agent of the company

(i) has not been duly appointed, or

(ii) does not have authority to exercise a power which a director, employee or agent of a company carrying on business of the kind carried on by the company customarily has authority to exercise;

(d) a person held out by the company as a director, employee or agent of the company with authority to exercise a power which a director, employee or agent of a company carrying on business of the kind carried on by the company does not customarily have authority to exercise, does not have authority to exercise that power; or

(e) a document issued on behalf of a company by a director, employee or agent of the company with actual or usual authority to issue the document is not valid or not genuine;

unless the person has, or ought to have, by virtue of his relationship to the company, knowledge of the matters referred to in any of paragraphs (a) to (e).

(2) Subsection (1) applies even though a person of the kind specified in paragraphs (b) to (e) of that subsection acts fraudulently or forges a document that appears to have been signed on behalf of the company, unless the person dealing with the company or with a person who has acquired assets, rights or interests from the company has actual knowledge of the fraud or forgery.

32. (1) A person is not deemed to have notice or knowledge of any document relating to a company, including the memorandum and articles, or of the provisions or contents of any such document, by reason only of the fact that a document

(a) is available to the public from the Registrar; or

(b) is available for inspection at the registered office of the company or at the office of its registered agent.

(2) Subsection (1) does not apply

(a) in relation to a document filed under Part VIII; or

(b) to a document relating to a restricted purposes company.