The British Virgin Islands has welcomed the final terms of the European Union’s Alternative Investment Fund Managers Directive, and expressed confidence that BVI Managers and Funds will have access to the EU market under the private placement regime and, in due course, the passport regime.

In a statement issued via a bulletin last week the BVI International Finance Centre said: “The BVI is widely acknowledged as having a robust regulatory system, a fact that has been recognised by international bodies including the OECD, FATF and the International Organisation of Securities Commissions. This recognition, the close relationships the FSC enjoys with key national and supra-national regulatory bodies and the FSC being a signatory of the IOSCO Multilateral Memorandum of Understanding will provide the best platform to ensure that the BVI will be ready, willing and able to enter into the cooperation agreements required to allow BVI funds and their managers access to the EU market over the coming years under the Private Placement Regime. Furthermore, the BVI government remains committed to expand the already large and growing network of TIEAs to enable its managers and funds to take advantage of the EU wide passport regime, if and when it is adopted.”

Head of BVI Investment Funds at leading international law firm Harney Westwood & Riegels Ross Munro welcomed the BVI’s response to the Directive. “The BVI has a long history of balancing the business and financial needs of our international clientele with regulatory and corporate governance policies that meet and in many cases exceed international best practice standards. We welcome the Government’s commitment to continuing this pragmatic approach.”

Munro, who is also chairman of the BVI Securities and Investment Business Advisory Committee, continued: “This recent public statement is in keeping with what we have been hearing privately – that is that the BVI Government is prepared and committed to entering into the necessary cooperation agreements with EU regulators over the coming years, and to expanding its network of TIEAs to take advantage of the passport regime if and when it is adopted.”

The final terms of the Directive were approved by the European Parliament last November. The Directive provides a framework for allowing the distribution of non-EU AIF to professional investors in EU Member States on a country-by-country basis through the private placement regime and, potentially from 2015, throughout the EU through the passport regime.

The British Virgin Islands is the second largest offshore hedge fund domicile, offering a flexible and cost-efficient regime for funds of all sizes.