Privy Council Hands Down Judgment In BVI Shareholder Rights

The Privy Council has recently handed down the judgment in Staray Capital Limited and another v Cha Yang [2017] UKPC 43, concerning the circumstances in which majority shareholder decisions to amend the Memorandum & Articles of Association (M&A) of a British Virgin Islands Company for reasons that are not in good faith to a company's best interests can be set aside. The case illustrates that the burden of proof is on the minority shareholder seeking to have the amendment set aside to prove bad faith. Moreover, the Privy Council explicitly decided that the fact that an amendment is intended to affect a particular minority shareholder and does affect that shareholder is not sufficient to prove such bad faith.