The Companies Act provides that any member of a company is entitled to payment of the fair value of his shares upon dissenting from any of the following: (a)
a merger, if the company is a constituent company, unless the company is the surviving company and the member continues to hold the same or similar shares;
(b)
a consolidation, if the company is a constituent company;
(c)
any sale, transfer, lease, exchange or other disposition of more than 50 per cent. of the assets or business of the company if not made in the usual or regular course of the business carried on by the company but not including (i) a disposition pursuant to an order of the court having jurisdiction in the matter, (ii) a disposition for money on terms requiring all or substantially all net proceeds to be distributed to the members in accordance with their respective interests within one year after the date of disposition or (iii) a transfer pursuant to the power of the directors to transfer assets for the protection thereof;
(d)
a redemption of 10 per cent. or fewer of the issued shares of the company required by the holders of 90 per cent. or more of the shares of the company pursuant to the terms of the Companies Act; and
(e)
an arrangement, if permitted by the court.
Generally any other claims against a company by its shareholders must be based on the general laws of contract or tort applicable in the BVI or their individual rights as shareholders as established by the company’s Memorandum and Articles of Association. (vi) Management The Companies Act vests the power to manage, direct and supervise the business and affairs of the company in its directors (subject to any modification or limitation in the company’s memorandum or Articles of Association). At all times after the appointment of its first director(s), every company must have at least one director, and no person may be a director of a company unless he has consented in writing to being a director. The names and addresses of all directors are entered on a register of directors. Directors are entitled to establish committees of directors, to which they may delegate their powers. However, the Companies Act specifies certain powers that may not be delegated, including the powers to amend the company’s Memorandum or Articles of Association, to appoint directors or agents, and to make a declaration of solvency or approve a liquidation plan. The directors retain responsibility for the exercise of any power delegated to a committee, unless they believed on reasonable grounds that the committee would in fact exercise the power in accordance with the duties imposed on directors by the Companies Act. The fiduciary duties of good faith, honesty and loyalty are enshrined in the Companies Act. Furthermore, the Companies Act reflects the common law duties of care, skill and diligence, and imposes on directors the duty to act for a proper purpose and not in a manner that contravenes either the Companies Act or the company’s Memorandum or Articles of Association. A director is obliged to disclose any interests he may have in a transaction to be entered into by the company (although he remains entitled to vote on the transaction, attend meetings in relation to it and be counted for the purposes of the quorum). Should he fail to do so, the transaction will be voidable by the company, unless the material facts of the interest are disclosed to the members and the members nevertheless ratify or approve the transaction, or the company receives fair value for it. (vii) Record-keeping The Companies Act sets out the various records which a company must keep. Every company must keep at the office of its registered agent in the BVI (a) its Memorandum and Articles of Association; (b) its register of members (or a copy thereof, in which case the company must notify the registered agent in writing of the physical location where the original is kept); (c) its register of directors (or a copy thereof, in which case the company must notify the registered agent in writing of the physical location where the original is kept); and (d) copies of all notices and documents filed by the company in the previous ten years. A company is required to keep a register of members containing, inter alia, the names and addresses of the persons who hold registered shares in the company. The share register may be in any form as the directors may approve but, if it is in magnetic, electronic or other data storage form, the company must be able to produce legible evidence of its contents. The entry of the name of a person in the register of members as a holder of a share in a company is prima facie evidence that legal title to the share vests in that person. A company is required to keep a register of directors containing, inter alia, the names and addresses of the persons who are directors and the date on which each person whose name is entered on the register was appointed and ceased to be a director. The register of directors may be in such form as the directors approve, but if it is in magnetic, electronic or other data storage form, the company must be able to produce legible evidence of its contents. The register of directors is prima facie evidence of any matters directed or authorised by the Companies Act to be contained therein.
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