On 7 January 2021, the British Virgin Islands ("BVI")
House of Assembly enacted1 section 24A of the
Eastern Caribbean Supreme Court (Virgin Islands) Act (the
"Act"), which confers statutory jurisdiction on the BVI
Court to grant interim relief in support of existing or intended
foreign proceedings.
This new measure is a swift, welcome response to the recent
controversial decision in Broad Idea International Limited
v Convoy Collateral Limited (BVICMAP 2019/0026), in which the
Court of Appeal overruled the landmark authority, Black
Swan Investment I.S.A v Harvest View Limited et al (BVIHCV
2009/0399). The Black Swan case had established the BVI
Court's jurisdiction to grant free-standing relief in support
of foreign proceedings, and had been followed and applied in
countless cases in the decade since, so the Broad Idea decision was
a momentous development that left the status of numerous extant
freezing and Norwich Pharmacal orders in serious doubt.
Moreover, the Black Swan principle had attracted widespread
international acclaim for the essential contribution it enabled the
BVI Court to make to international efforts to combat cross-border
fraud. The Broad Idea decision was hence perceived as a
damaging retrograde step that would do nothing to enhance the
reputation of the Territory.
For these reasons, the BVI legal community urgently lobbied for,
and provided input into the drafting of, this new measure.
They also took the opportunity to call for clarification of the BVI
Court's power to grant Norwich Pharmacal relief in support of
foreign proceedings irrespective of any available remedies under
the Evidence (Proceedings in Foreign Jurisdictions) Act, which had
been the subject of uncertainty. The legislature heeded this
call and the new measure also makes clear such relief may be
granted.
The decision in Convoy has been appealed to the Privy Council and
is due to be heard on 16 February 2021. The question of
whether Black Swan was correctly decided will hence soon be
revisited. The outcome of the appeal remains of some
significance because, while deliberating the passage of the new
measure, there were calls for it to be given retrospective effect,
which the Act does not expressly provide for. It follows that
Black Swan injunctions granted before 7 January 2021 remain
potentially at risk of being challenged and set
aside.
Footnote
1 By virtue of The Eastern Caribbean Supreme Court (Virgin Islands) (Amendment) Act, 2020.
Black Swan Flies Again – New BVI Legislation Confirms Availability of Free-Standing Interim Relief Download
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