Walkers Partners Rosalind Nicholson and John O'Driscoll and
associate Cate Barbour acted for the successful defendants in an
important case in which the BVI Commercial Court has held that a
beneficial owner of shares in a BVI company does not have standing
to bring a claim under Section 184B of the BVI Business Companies
In a reserved Judgment, Mr Justice Davis-White QC agreed with
the Defendants' submissions holding that:
Section 184B BCA confers a right on a
"member" with regards to conduct of the company or of a
director of the company which contravenes the BCA or the memorandum
or articles of the company;
A "member" is defined for
the purposes of section 184B by 184A as "a shareholder"
or a personal representative of a shareholder;
A "shareholder" is defined
by ss2 and 78 BCA as "a person whose name is entered in the
register of members as the holder of one or more shares, or
fractional shares, in the company";
That since it was accepted that the
Claimant's name was not entered in the register of members as
the holder of shares and so was not a member within the meaning of
the Act; and
Therefore the Claimant had no locus
standi to bring proceedings under section 184B.
The Judge rejected the Claimant's submission that the
beneficial owner holding an interest through a nominee is
nonetheless "a shareholder" within the meaning of s78
BCA, and thus "a member" for the purposes of s184B
In reaching his decision, the Judge declined to follow the
decision in Headstart Class F Holdings Limited and Citco Global
Custody NV v Y2K Finance Inc  BVIHCV2007/0278), holding that
the Judge in that case had erred in her interpretation of the key
English authority Atlasview v Brightview  BCC 542 in holding
that that a shareholder for the purposes of Section 184I (unfair
prejudice claims) may include the beneficial owner of shares in a
BVI company, where the registered shareholder is acting as nominee
for the beneficial owner. Davis-White J noted that the Court in
Brightview had decided that the beneficial owner was not entitled
to make such an application and on that basis struck out their
The case has broader ramifications since the definition supplied
by section 184A also applies to claims under 184C (derivative
claims) and 184I (unfair prejudice).
Walkers has a depth and breadth of experience in corporate
litigation and associated advice on strategy and risk management
unparalleled in the BVI of which this case provides a further
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Confidentiality of corporate documents and information is one of
the key attractions of incorporating a company in the BVI. A
company search of the BVI Registrar of Corporate Affairs will only
disclose certain information and documents.
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