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ARTICLE · 02 JULY 2015

Potential Changes To Creditors' Rights In The BVI – Administration Orders

Harneys
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The British Virgin Islands (BVI) is once again considering proposals to bring into force provisions which permit the making of administration orders in relation to BVI companies.

British Virgin IslandsInsolvency/Bankruptcy/Re-Structuring
Indira Birkwood
Indira Birkwood
Tanya Cassie-Parker
Tanya Cassie-Parker
Colin Riegels
Colin Riegels
Russell Willings
Russell Willings
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The British Virgin Islands (BVI) is once again considering proposals to bring into force provisions which permit the making of administration orders in relation to BVI companies. Any person with a credit exposure to a BVI company needs to be aware of the proposals and what this might mean in relation to their rights against the company.

Q1. What exactly is administration?

A1. The administration process is an alternative to liquidation for financially distressed companies. Whereas liquidation is intended to break up the company and sell off all of its assets, administration is intended to try to preserve the company as a going concern.

Q2. How does it work?

A2. An application is made to the BVI court for an administration order. If the order is granted then an administrator (who must be a licensed insolvency practitioner) is appointed to administer the company's assets. But the crucial point is this – once the order is made, there is a moratorium on

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