We have a client who is not British nor is he domiciled in the UK. A property in the UK is owned by a company which is Registered in British Virgin Islands and our client is a shareholder in the Company.
Does UK intestacy Law apply as the property is situated in the UK or does a different jurisdiction apply due to the fact the property is owned by a company registered in the British Virgin Islands.
Any advice would be grateful.
Assuming the client is dead, his/her asset is shares in the company. The applicable law will depend on the succession and private international law of the BVI.
Yes he had a 33.3% share in the Company
The shares might be within charge to IHT if the property is residential.
As things currently stand, BVI treats shares as movable property, so that succession is according to the law of the shareholder’s domicile. But there is a Privy Council appeal outstanding in which the appellants contend that shares should be treated as immovable property, in which case succession will be according to the law of the BVI.
I agree with Jack if the property is residential, a non- dom shareholder of an off shore company owning UK residential property - there is a charge to IHT - I think it was in the bits left of the 2017 FA ?
Further to Josh Lewison’s comment, do not be surprised if the company’s Registered Agents / Share Registrars in the BVI request that a Grant of Letters of administration be obtained in the BVI in order to transfer the Deceased’s shares to the executors or to the Deceased’s beneficiaries.
This is a long and convoluted process.
In view of the recent political upheavals in the BVI I expect it will take longer than usual with additional AML documentation being needed.
Probate Resealing Services
I always understood that under BVI law shares held in a BVI registered company are BVI situs assets and movable in nature. As a consequence, for succession purposes it is the law of the domicile of the deceased which is relevant. A grant of letters of administration would be required from the BVI courts.
Josh, I was unaware of the case you refer to in your response above. Could you provide me with some further details please?
The case is Al-Thani v. Al-Thani and the Court of Appeal judgment is here:
I understood that they had permission to appeal to the JCPC, but I can’t see it on the list of pending cases.
Thanks Josh; apologies for long delay in replying. Appreciated.