If you have already decided the location where you want to form your company, you can simply click the link below for a detailed introduction to the materials, processing time, and other requirements to be met.
I want to register:
If you have decided where to register your company, or you are not fully familiar with the differences between companies registered in these two territories, don’t worry! Please keep reading, and Hongda will take you through the comprehensive introduction to registering a company in BVI or the Cayman Islands.
BVI or The Cayman Islands: Which one Should You Choose?
British Virgin Islands (BVI)
The British Virgin Islands, or BVI, is located in the Caribbean Sea. BVI is a British Overseas Territory and a member of the Commonwealth. Nowadays, there are over 1.7 million companies registered in BVI, a quarter of which are registered by Chinese enterprises or individuals, making it one of the most popular offshore registration choices globally. Overseas listing preparation, global tax planning, and company asset protection are the major purposes of setting up a BVI company in the enterprise’s overall structure. Additional incentives brought by a company registered in BVI include low or even tax-free advantages and key management personnel’s information confidentiality, leading to a more flexible tax optimization arrangement.
Key Features of BVI companies
- Business conducted outside of the BVI is exempt from all forms of taxation.
- The corporate structure is simple and can consist of just one shareholder and one director.
- Shareholder information is not accessible to the public.
- A register of directors and senior management must be filed with the Registrar of Companies, but it is not available for public inspection.
- There is no minimum capital requirement, and any currency can be used as the share capital denomination.
- Shares can be issued with or without par value.
- A Chinese company name can be registered with the Registrar.
- There is no requirement to prepare audited accounts or hold annual general meetings of shareholders.
- There is no requirement to declare beneficiaries, annual profits, or financial status.
The Cayman Islands
Located in the western Caribbean Sea, the Cayman Islands is also a British Overseas Territory. Thanks to its business-friendly regulatory environment and advanced infrastructure, it has been known as a leading jurisdiction for offshore company registration. Regarded as the pioneer of the offshore company formation destination, the Cayman Islands has built a well-defined classification system for companies registered here, making it one of the best-known offshore financial centers globally.
Key Features of Cayman Islands Companies
- Exempted companies primarily conduct business outside the Cayman Islands.
- They can apply for a tax exemption certificate with an initial term of 20 or 30 years.
- The corporate structure is simple and can consist of just one shareholder and one director.
- Shareholder information is not accessible to the public.
- A register of directors and senior management must be filed with the Registrar of Companies, but it is not available for public inspection.
- There is no minimum capital requirement, and any currency can be used as the share capital denomination.
- Shares can be issued with or without par value.
- A Chinese company name can be registered with the Registrar.
Comparison of BVI and the Cayman Islands Companies
Similarities between BVI and the Cayman Islands Companies
| Category | Description |
| Legal System | Both use a legal system based on English common law. |
| Tax Policy | Exemption from taxes on income generated outside the jurisdiction with no capital gains or inheritance taxes. |
| Corporate Structure | Flexible corporate structure that can have just one shareholder and one director, with no nationality restrictions. |
| Registration Requirements | There is no minimum capital requirement, and any currency can be used as share capital. |
| Shareholder and Director Information | Shareholder information is not publicly available, and director information is confidential. |
| Company Name | Both allow registration of a Chinese company name. |
Differences between BVI and the Cayman Islands Companies
| Category | BVI Companies | The Cayman Islands Companies |
| Tax Exemption Certificate | Does not offer a tax exemption certificate | Can apply for a tax exemption certificate (20 or 30 years). |
| Director Information Submission | Not required to submit a register of directors; only internal company records are needed. | Required to file a register of directors and senior management with the Registrar of Companies, but not publicly available. |
| Financial Compliance | Not required to submit regular financial statements or hold annual general meetings. | May have stricter compliance requirements, especially in fund management. |
| Beneficial Ownership Information | Not required to disclose beneficial ownership information. | In some cases, beneficial ownership information must be submitted but is not publicly disclosed. |
| Name Registration | Name registration is relatively flexible. | Name registration may be more stringent, especially for companies related to funds and financial services. |
| Costs and Fees | Lower company formation and maintenance costs. | Legal and compliance service costs may be higher. |
| Applicable Business Types | Mainly suitable for small and medium-sized enterprises and individual investors for simple offshore companies. | Widely used for establishing hedge funds, private equity funds, and other complex financial instruments, suitable for large enterprises and high-net-worth individuals. |
Ready to Start?
We hope that after reading the information, you have gained a better understanding of the companies in BVI and the Cayman Islands. If you have figured out in which area you want to register your company, please click the following link:
I want to register:
Don’t worry if you are still not sure about which area is better for your business. Hongda is fully aware that registering an offshore company is an important decision you should think twice about. We will be happy to have a free online meeting with you to talk about your plan to help you make your final decision!
