Business BVI Winter 2021/22 by Business BVI

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conyers .co m

and Corporate Services in the British Virgin Islands and around the Globe

LEGAL EXPERTISE For more information please contact: Robert J.D. Briant Partner, Head of BVI Corporate robert.briant@conyers.com +1 284 852 1100 Mark J. Forte Partner, Head of BVI Litigation & mark.forte@conyers.com +1 284 852 1113

CONYERS CONGRATULATES DR ROBERT MATHAVIOUS, OBE Our heartfelt congratulations to Dr Robert Mathavious on his years of dedicated service and outstanding contribution to the British Virgin Islands financial services sector. It has been our privilege and honour to interact with Dr Mathavious and his senior team at the Financial Services Commission, an institution which he memorably established and served for almost twenty years as its Managing Director and Chief Executive Officer. Dr Mathavious exemplifies leadership. His distinguished record of achievement includes playing a pivotal role in advancing the BVI as a stable, compliant and trusted financial centre consistent with international standards and ethics. He is a passionate and tireless advocate of social causes and has served more than 20 philanthropic groups in the BVI community. He was also instrumental in the founding of the Territory’s Recovery and Development Agency. For these reasons and many others, Dr Mathavious has long been a pioneering force in the financial services sector and the community at large. Dr Mathavious – as a leader, visionary and person, you are an inspiration to us all. Wishing you a wonderful and well-deserved retirement from your friends at Conyers.

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SPECIAL SECTION

79 80

THE STRATEGIST AND THE KINGDOM OF PASEA

Leading the embattled dream Jennifer Potter

A few words Robert Briant

Winning a level playing field Lorna Smith, OBE

The Panama connection Jaime Aleman

Clarence Faulkner

Dr. Robert A. Mathavious

Nation Builder 39

INTRODUCTION

55 56

NATION BUILDER

Dr. Robert Mathavious: An undeniable example of what our Virgin Islands people are capable of achieving

Hon. Andrew A. Fahie, Premier and Minister for Finance

Elise Donovan 52

Empowering enlightenment: Reflections on the BVI’s Buddha Neil Smith

A TALENT PIPELINE

BVI SOFT POWER

My (accidental) mentor

A view from abroad Kristian Wilson

Building a nation by building people: enhancing capacities, cultivating copetencies

100

The Midas touch

ROBERT'S MILESTONES IN FINANCIAL SERVICES

A CONVERSATION WITH

102

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GLOBAL CURRENTS CONFERENCE GALA THE HOUSE THAT MATHAVIOUS BUILT (GALLERY) ROBERT’S YEARS BY THE NUMBERS

A success story: Dr. Mathavious and the fund industry Jerome Rubin-Delanchy

104

BVI: The shining beacon of IFCs in Asia Martin Crawford

106

RICHARD PETERS 73

Eastern promises: Dr. Mathavious a key progenitor of Sino-BVI relations Ellie Crespi

Dr. Kedrick Pickering

Integrity that created leverage coupled with Taoist leadership Peter Tarn

Brodrick Penn

The Mathavious Doctrine

The brain behind the Financial Services Commission Act, 2001 Cherno S. Jallow, QC

A legacy built on trust Ray Wearmouth

Ayana Glasgow

Glimpses of his strategic prowess, in Robert Fashion

Leadership and the Legacy of Robert Mathavious Martin Kenney

108

Achievement in times of challenge Jeffrey Kirk

111

An aspiring arbitrator Francois Lassalle

Contents 14

OPENING REMARKS

MASTHEAD

CONTRIBUTORS

G A L L E RY

BUSINESS

SPECIAL SECTION

112

TOURISM and regained freedoms

132

R E A L E S TAT E

BUSINESS

TOURISM

REAL ESTATE

28 WHAT’S TRENDING IN

112 A LUXURY WELLNESS TOUR OF

132 THE OUTLOOK FOR

VILLA DESIGN AT A LOCAL & INTERNATIONAL LEVEL 34 CONSTRUCTION IN THE

BVI: INDUSTRY UPDATE & FORECASTING FOR 2022

152

THE DECIDER

THE BVI

REAL ESTATE

120 ARE WE LOSING OUR

ADVANTAGE AS A DOMINANT PLAYER IN THE GLOBAL YACHTING SPACE?

THE DECIDER 152 CLARENCE M. FAULKNER:

AN INVESTOR CONVERSATION 126 BUSINESS BVI SITS DOWN WITH

DAVID V. JOHNSON FOR AN UPDATE ON OIL NUT BAY 130 THE BRITISH VIRGIN ISLANDS:

MY VERY FAMILIAR, FOREIGN HOME

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Opening Remarks

They Don’t Teach Courage at Oxford As a territory, we have entered 2022 in a defensive crouch. We do so in a highly globalised world, one that will remain so for sometime. Ironically, it is a world that the British Virgin Islands have played a substantial role in facilitating via frictionless cross border trade and investment, driven by the confidence that the international business community has placed in the financial instruments we position in financial services. A lecture in rocket science is not required to identify the foundation of this A lecture in rocket science is not required to identify the foundation of this crouch - the devastating hurricanes of 2017, a follow-on two year, global pandemic - and now we are sitting here in limbo waiting for the report of a Commission of Inquiry. An inquiry that demonstrated that our governance structures are in dire need of a stem to stern overhaul. All this in less than five years, and a resultant level of fatigue that would cause some droop even in the strongest of Marine shoulders. Still we must rise. The BVI is now in a period where we must collectively channel the fortitude exhibited by our early leaders and citizens, that moved the territory from a near state of economic destitution, to a brand recognised globally in not one, but two very competitive areas of economic activity. This, with considerable potential in other future leaning emerging areas, that require focus. While we all agree that today’s economic, climate related and governance challenges are daunting, imagine for a moment what it took to get to this rung on the ladder. We did not go it alone, but we led the charge, determined that we were not only capable but worthy of better. It is time to address the national issues in our ‘BVI Worry Box’. Time to up our thinking as we manage our co-existence with COVID-19. The BVI must return consistency to our governmental leadership, the DNA of national progress. The BVI needs to set its levels for its future prosperity and success by recognising that there is no vaccine for global warming and that small island states will shoulder an unfair and disproportionate share of the attendant fallout. Now is the time to foster a national consensus on an economic agenda, an alignment of the constellations on all matters economic. We must develop and nurture BVI Alliances on the global economic playground to drive our future prosperity. We must be agile as we face the disruptive challenges before us, as we navigate a green global economy. We must resurrect our courage that has always provided the thrust to create epochs of economic opportunity throughout our modern history. We need not look far for such inspiration. No one better epitomises that courage, exercised with extraordinary prescience and deft precision over the last three decades in guiding the BVI economic growth, than Dr. Robert Mathavious. Such courage is not taught at Oxford. It is innate. Mr. Mac as he is respectfully and affectionately referred to, is nothing if not one of the most strategic minds cultivated in the BVI. He is always several steps ahead in any engagement he undertakes. This natural ability, was on constant deployment like a radar. It is impossible to fathom what the BVI financial services sector would have been like had there been no Dr. Robert Mathavious. So voluminous, varied and consequential were his contributions over the last two decades to the development of the sector. Above all else, it took courage. We at Business BVI believe that only a very small handful of persons may, and we stress may, have directly contributed more to the economic wellbeing of these islands over the last two plus decades, than Dr. Mathavious.

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Hence, we are most pleased to pay tribute to Robert for his enormous contribution to the betterment of life in these islands in this edition’s Special Section (p.38). In pulling this section together, we drew on the insight of key leaders in financial services in the BVI and overseas, reflective of Dr. Mathavious’ influence in the global financial services space. It provides a glimpse into the BVI backstory as a facilitator of globalisation. Transactions which helped to move hundreds of millions into the global middle class in China, the wider Asia community, India and in many African countries. The immediate post Mathavious chapter of the BVI financial services journey, will continue to be a landscape of IEDs. Those IEDs will draw their potential to frustrate us from: The post COVID-19 world, the continued expansion of FinTech, the continued rise of AI (Artificial Intelligence) in daily life, the reconfiguration of global supply chains and production, the continued rise of China as an economic and military superpower, the further decoupling of China and the US, Global Britain, the post Brexit realignment of the EU, the transition to a green global economy, the rise of Africa - shaped by Africans, the deepening evolution of Hong Kong driven by China’s pull, the evolution of the BVI on the self determination ladder, coupled with our ability to develop and nurture a talent pipeline to meet the needs of the sector. This year will be defining for the recovery of the local economy as we transition to a posture of co-existence with COVID-19. For a meaningful recovery, tourism must lead the charge. After just shy of two years with a severe limp, the sector must transition to the early stage of a recovery marathon. Beyond the special section, the majority of the articles will draw your attention to tourism, including the Gallery section (p.17) featuring the resurgence of tourism in the North Sound area, we also interrogate what’s happening in the all important yachting sector - Are we losing our advantage as a dominant player in the global yachting space? (p.120), we look at wellness tourism and the destination’s growing and unique assets in the space - A luxury wellness tour of the BVI (p.112 ), we take a deep dive into - What’s trending in villa design at a local & international level (p.28 ) and we end with - A Sit down with David V. Johnson for an Update on Oil Nut Bay (p.126 ). Our informative look at who is driving growth in the real estate sector since the hurricanes of 2017 and now COVID-19 - The outlook for real estate (p.132) will not disappoint. Here in the BVI, the sector has seen a COVID-19 revival as reflected in markets regionally and internationally. A point of departure here has been the strength of the domestic market in driving sales. Our wrap for the edition is our must read, wide ranging - Investor Conversation with Clarence Faulkner (p.152) a man of courage, on how he brought Wall Street to Road Town with all the bells, whistles and substance. And he is just getting started. Enjoy! Please share your feedback at russellharrigan@gmail.com.

Russell Harrigan MANAGING EDITOR & CHIEF CONTENT OFFICER

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CONTRIBUTORS Russell Harrigan MANAGING EDITOR & CHIEF CONTENT OFFICER

Oyster Publications LTD PUBLISHER

Portia Harrigan PROJECT CO-ORDINATOR

Claire L. Shefchik SENIOR STAFF WRITER

Introducing some of the talented individuals whose hard work and creativity helped us to produce this edition.

Russell Harrigan ADVERTISING 2.

We welcome Andrew to the pages of Business BVI examining whether the BVI is losing its long standing advantage in the global yachting space. A question that he is imminently qualified to interrogate given his in depth knowledge. He lives and breathes yachting and currently serves as Chairman of the Marine Association of the BVI. While the local sector has seen a very strong rebound from the devastation of the 2017 Hurricanes, COVID has been challenging. This is best manifested by the steady exodus of vessels to other regional and global destinations, unheard of since we introduced our Yachtsmen Friendly legislation and policies in the early 1990s. Yachting is the dominant sector of our tourism and it has traditionally been the engine that leads the way forward post any crisis, be it economic or natural disaster.

Edward Childs

THE OUTLOOK FOR REAL ESTATE (p.132) Edward, our resident prognosticator on all things real estate in the BVI, reports that the sector continues on a growth track dating back to the aftermath of the Hurricanes of 2017. It picked up steam in 2021 led by government COVID specific incentives. While both local and foreign buys remain active, local buyers have been the dominant force during the last two years. Edward also takes an in depth look at a number of new laws recently enacted by the government and their implication for the sector 2022 and beyond. His insight is always well informed by in-depth research and analysis, advice that is critical to informing your final decision be it residential, investment in a vacation villa or the development of a top tier resort, marina or private island.

Cover illustration by Oyster design team

Business BVI is a bi-annual magazine published by Oyster Publications LTD P.O. Box 3369, Road Town, Tortola, British Virgin Islands Tel: 284-494-8011 Fax: 284-494-3066 www.oysterbvi.com Email: info@oysterbvi.com Please send comments and address changes to this address.

Business BVI and Oyster Publications LTD are divisions of Oyster Global Marketing Group.

Andrew Ball

ARE WE LOSING OUR ADVANTAGE AS A DOMINANT PLAYER IN THE GLOBAL YACHTING SPACE? (p.120)

As we enter 2022, one sector looking forward to a robust year is construction, driven by strong public sector capital spending on projects dating back to the hurricanes of 2017. The private sector spurred by tourism related spend on major resorts will continue, coupled with strong residential activity. Tempering this optimism is the global rise of inflation and the resultant price increase for all things construction along with the global supplies chain headaches. Marvin E. Flax, Managing Director of OBMI BVI, continues to be our seer in this space.

CREATIVE

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CONSTRUCTION IN THE BVI: INDUSTRY UPDATE & FORECASTING FOR 2022 (p.34)

Louie Acantilado Oyster Design Team

Portia Harrigan

Marvin E Flax

Sarah E Harrigan

THE BRITISH VIRGIN ISLANDS: MY VERY FAMILIAR, FOREIGN - HOME (p.130)

OBMI WHAT’S TRENDING IN VILLA DESIGN AT THE LOCAL AND INTERNATIONAL LEVEL (p.28) One of the initial longterm transformations emanating globally from the pandemic, is the migration of the well heeled from cities and other locales to destinations where space is not just a luxury but a way of life. It is driven by the need for social distancing. Island tourism destinations such as the BVI could potentially see significant growth from this trend, as it adds a new dimension for the expansion of the extended stay visitor segment. We turned to OBMI to explore this how this trend is influencing villa design. OBMI is a global architecture firm widely celebrated for creating distinctive designs for high-end hotels, luxury private residences, and engaging urban areas. Through several global design studios, OBMI offer an integrated approach that combines responsive design strategies, the latest innovations, and technical expertise to create experientially memorable, environmentally responsible, and financially successful destinations.

We welcome Sarah back to the pages of Business BVI after a decade long hiatus as she helps us to appreciate the natural treasures of the destination, an antidote for the pandemic with its social distancing, open air and border closing demands. The destination has seen a significant spike in the demand for nature walks and hiking tours by both residents and visitors alike. These tours have created business opportunities for many well trained and knowledgeable local experts who have stepped forward, and enhanced our appreciation for the incredible inspiration that the outdoors being to life. Join Sarah and Mervin Hastings of Eco Adventures BVI for an adventure on our wild side.

www.businessbvimagazine.com All information in this publication has been carefully collected and prepared, but it still remains subject to change and correction. Use this content for general guidance only and seek extra assistance from a professional adviser with regard to any specific matters. Copyright reserved. None of the contents in this publication may be reproduced or copied in any form without permission in writing from the publisher. These articles do not constitute tax or legal advice, and no action should be taken based on the information in these documents without first consulting suitable tax or legal advisers. No liability for actions taken, or in action, based on the information in these articles, will be accepted.

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The Gallery

Compass Rose, Oil Nut Bay

WHAT THE EDITORS ARE OBSESSING ABOUT IN THIS ISSUE

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Gallery

Oil Nut Bay Update Catering to discerning individuals seeking a serene and socially distanced vacation locale or second home, Oil Nut Bay is the perfect getaway. The idyllic resort located in the coveted North Sound, Virgin Gorda is entirely surrounded by the turquoise waters of the Caribbean Sea on one side and the Atlantic Ocean on the other. The 400-acre resort is exceptionally private and consciously preserved, accessible only by boat or helicopter. Guests stay in private villas custom-built into the island’s topography, where the architectural designs meld cutting-edge, modern elements with natural elegance. Real estate is available priced from $1.95M to $39.5M and nightly villa rates range from $600 to $30,000 per night. Top tier amenities include a beach club with three pools and a swim-up bar; wellness centre with gym, two pickle ball courts and two tennis courts; equipment for kayaking, sailing, and snorkelling; Nut House Kids Club; world-class dining options; and two Helipads.

Oil Nut Bay was named to Robb Report’s 2021 Best of the Best for Best New Island Community.

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Expansion Plans The resort features an exciting new Marina Village with its Nova overwater restaurant and bar, suspended pool with hammocks and daybeds, a games room, 93-slip marina, market and boutique. Expansion plans for 2022 include a day spa that will be open to the public with outdoor showers, a water sports centre, additional provisioning and take-away for boaters and a new beach next to Nova. A new interactive nature centre is also on the drawing board for the resort which offers month-long villa rates. ONB Eats restaurant delivery to villas offers curated picnics for socially distanced dining and an increased number of private chefs available affording guests dine in opportunity in the comfort of their own villas if desired.

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Real Estate The low-density resort features just 117 distinguished home sites set within eight unique neighbourhoods, where each celebrate the island’s diverse topography and great expansive sea views. The luxury homes and villas are custom-built into the island’s terrain and the architectural designs meld cutting-edge, modern elements with natural elegance. Lots for sale range in pricing from $1.95 to $25 million, villas for sale range from $2.95-$39.5 million. Residents can choose an incredible lot to create their own one-of-a-kind island oasis, purchase an exquisite completed turnkey property, or buy a spec home designed by some of the world’s most esteemed architects. The sales team has seen great success within the past year with more than $30 million in land sales since January 2021. The developer is building three turnkey, fully-furnished homes in the Marina Village—priced from $3.45M to $4.95M. There will be a new Ocean Neighbourhood, featuring 8 new homesites, two of which have already sold. The neighbourhood includes 3-bedroom turnkey Ocean Villas, the first of which is priced at $6.95M land and home included and will be completed in the next 12 months, and sites that are blank slates for owners to create their ultimate dream home. The homesites in this neighbourhood range from $4.45M to $7.95M. Net Jets Partnership Oil Nut Bay now offers exclusive access to private luxury travel through its partnership with Net Jets. No crowds, no queues, no waits. ONBs dedicated Concierge Team will coordinate VIP customs clearance with the BVI Airports Authority’s FBO for an entirely stress-free, seamless process. In an exclusive, bestin-class, partnership Oil Nut Bay guests can take advantage of a one-time round-trip flight for the same rate NetJets Owners receive.

Corcoran BVI In 2018, Corcoran announced its intention to build a franchise network, and in February of the following year it made good on those plans, introducing California-based Corcoran Global Living as the brand’s first affiliate. Almost a year later to the day, Corcoran BVI became the brand’s tenth affiliate — and its first global presence. “It’s a badge we wear with great pride,” says David V. Johnson, chairman of Victor International. “We knew aligning with Corcoran was the right choice because of its growing market position, the synergy between our lifestyle brands, and its spectacular leadership,” Johnson adds. “We look forward to a long and mutually beneficial partnership.” Currently, Corcoran BVIs office can be found in Oil Nut Bay’s Marina Village and they have plans to expand their presence to Tortola by 2024. www.oilnutbay.com

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Gallery

Saba Rock Is Now Open After a complete rebuild, the iconic island destination in the British Virgin Islands reopened for the first time since Hurricane Irma hit in 2017.

Saba Rock, an island resort destination in the British Virgin Islands, celebrated its grand reopening on Oct. 15, debuting a fresh design concept and unveiling new guest experiences. Saba Rock’s General Manager Alain Prion announced the resort’s official opening following a ribbon-cutting in front of more than 100 guests from the BVI community including government and tourism officials, hospitality partners, and residents. The much-anticipated event comes five years after the destination was hit by Hurricane Irma, leaving the iconic island, which was made famous by diving legend Bert Kilbride, completely destroyed. Czech-based ADR Architects was brought in to create an elevated design concept that is not only structurally sound to withstand future storms but keeps the fun-loving vibe and charm that Saba Rock was known for among divers, kiteboarders, and sailors who frequented the island. “The reopening of Saba Rock is a great day of pride for everyone involved in its rebuilding and transformation process,” said Prion. “The new Saba Rock experience is a true reflection of our destination that celebrates our storied past and the lifestyle that attracts visitors from all over the world. We are thrilled to finally be

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rejoining our community and tourism partners to welcome guests to stay in our beautiful new rooms, sail up to our docks, dine at our delicious new restaurant, and just enjoy this little piece of paradise.” Saba Rock’s new contemporary aesthetic features a fresh take on the destination's nautical lifestyle and features seven guestrooms and two suites designed as a chic retreat that plays up the island’s reputation as a kiteboarding and sailing destination. The island also has an expansive, open-air restaurant, lounge, two bars (including a rooftop sunset bar), spa room, and retail space, that also serves as a museum with artifacts from nearby shipwrecks. The designers abandoned the traditional color scheme often seen in the region and embraced color with bright pops of cerulean blue and crimson red, creating a fun and unexpected setting in Virgin Gorda’s North Sound. To play up the playful spirit that Saba Rock is known for, the designers added some surprising elements to the island such as two classic British phone booths brought in from England, and commemorative memory walls in guestrooms that display photography of the island’s past. "Saba Rock really lights up the North Sound, and lights up our tourism product," said the Honourable Andrew A. Fahie, Premier &

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Minister of Finance. "This project brings hope that tourism is back on the rise in the BVI and that the economy of the BVI will start coming back stronger than ever. This is not just the reopening of Saba Rock, this is ensuring that we plant a rock steady and firm in the middle of our economy." While some of Saba Rock’s favorite attractions are back such as the daily tarpon feedings, new activities and amenities have been added to create a turn-key vacation experience for guests and visitors including diving, snorkeling, standup paddleboarding, waterfront yoga, kiteboarding, glass-bottom boat tours, charter boat and rib rentals, and more. The all-new Saba Rock sits in the center of all the action as an icon within the North Sound of the British Virgin Islands. The fun-loving island resort, which has been a haven for yachties, divers, and kiteboarders for more than 50 years, now offers locals and visitors alike an elevated experience with the same free-spirited charm and laidback lifestyle that made the destination famous.

Saba Rock’s executive team celebrated the destination’s opening with a grand reopening event and ribbon cutting ceremony. L-R: Ciro Gentile (F&B Director), Merrie Pendlebury (Retail manager), David Brough (Chief Engineer), Alain Prion (General Manager), Karlene Prion (Resort Manager), Frederic Cougnon (Executive Chef)

About Saba Rock Located in the North Sound of Virgin Gorda in the British Virgin Islands, Saba Rock is an iconic island paradise offering a laidback, Caribbean-casual atmosphere. Made famous by diving pioneer Herbert “Bert” Kilbride in the 1960s, the barefoot casual cay is an ideal spot for boaters, sailors, and watersport enthusiasts in search of a private island escape. Alongside the crystal waters of the British Virgin Islands, guests can enjoy a variety of aquatic offerings including snorkeling, diving, kitesurfing, boating, and more. The resort boasts nine rooms and suites, a restaurant, lounge, two bars, a dive and retail shop, and a full-service spa room. www.sabarock.com

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Enter Bitter End 2.0 Following a four-year closure and a complete rebuild inspired by its sense of place and storied history, Bitter End Yacht Club, a 64-acre island outpost n North Sound Virgin Gorda, reopened its doors, docks, and nautical village in December. For over 50 years, Bitter End has catered to seafarers and watersports enthusiasts from around the globe. Bitter End has once again claimed its rightful place as the world’s premiere place to play in, on, and around the water. Set along a mile of pristine shoreline, Bitter End has garnered a wellearned reputation as one of the best anchorages in the Caribbean. Founded in 1969 and built by sailors for sailors, the property has been privately owned and operated by the Hokin family since 1973. Over the years, Bitter End evolved from a quirky island outpost (built originally with a helping hand from Robin Lee Graham of Dove fame) into a world class destination and watersports mecca. Throughout

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its evolution, it was always known for its elegant, laidback and communal style, equally as welcoming to celebrities as it was to liveaboards. World-class sailors and resort guests alike were always comfortable mingling at what was hailed by The New York Times as a “rollicking nautical village.” Then the hurricanes of 2017 came calling. In her 50 years, Bitter End had weathered countless significant hurricanes but no 10 storms combined would have amounted to the destruction wrought by Hurricane Irma, which was then closely followed by Hurricane Maria. Of the property’s nearly 100 structures, none were left unscathed. Rebuilding from scratch was the only option. Undeterred by the circumstances, the Hokin family hunkered down to reimagine a property full of history that would be bolstered by a battalion of loyal guests. The mandate was clear: to recreate a property for like-minded adventurers who appreciate the wonder, character, and passion of the retreat the Hokins originally built for their own family. To this day, the family and their crew remain passionate stewards of the

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original Bitter End experience, and they are staunchly committed to protecting the exquisite stage Mother Nature has built for it. To that end, Bitter End 2.0, as the Hokin Family likes to call it, has been taking shape. Returning guests will see a new nautical village, anchored by buildings that, while built to the highest standards of modern construction, recall past landmarks, including the Clubhouse Restaurant, the Quarterdeck Marina, the Watersports Center, and the Reeftique Boutique. “We have taken everything that we’ve learned over five decades and incorporated it into the redesign to purposefully pay homage to our history. At the same time, we are elevating Bitter End’s amenities and hospitality offerings to create a world-class experience that will delight travellers for generations to come," explained Richard Hokin, patriarch of the family. The waterfront plaza, connecting all the key village buildings and fronting the North Sound anchorage, is sure to become the central feature where guests will congregate. “The village is an incarnation of Bitter End’s roots as a yachting destination and sailor’s hangout. Its beach, seawall, and plaza are dotted with seating areas designed for settling down with a cold drink and conversation, a favorite book, or simply taking in the beautiful expanse of North Sound,” shared family member Lauren Hokin. For those looking to satisfy a sailor’s appetite or quench a captain’s thirst, The Bitter End Village will offer several distinct dining experiences including a new twist on the iconic Clubhouse, and a reinterpretation of the B.V.I.’s original waterfront bar. The village will be rounded out with a few new offerings, including an open-kitchen pizza and wine concept, and a sunken vessel turned into the coolest beach bar in the Caribbean. The culinary offerings at each of these eateries will be supported by Bitter End Farms, an on-property producer of fruits, vegetables, herbs and other produce. A “farm-andsea-to-table” culinary philosophy will celebrate local fisherman, farmers and flavors of the Caribbean. The rebirth of Bitter End would not be complete without a premiere watersports facility and fleet. Bitter End sits at the confluence of North and Eustatia Sounds, two natural watersports playgrounds. The location is perfect for sailing, kiteboarding, windsurfing, stand-up paddleboarding, diving and so much more, it is only natural that Bitter End will once again feature a fleet to match the desires of visitors wanting to try their hands at those activities. Remaining true to Bitter End’s legacy, Bitter End’s quarters are spot-on for those called to the ocean. Cantilevered over the Caribbean Sea, the all-new Marina Lofts are built for those who desire to sleep at the water’s edge. Inspired by vintage sail lofts—Bitter End will boast the only over-the-water bungalows in the BVI. For guests who are interested in being the first to stay at Bitter End 2.0, be sure to get in line as there will only be a pair of lofts at the start. www.beyc.com

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Airy suite with plunge pool, expansive terrace and outdoor shower. Rosewood Little Dix Bay

Sharon’s Take: Virgin Gorda As The BVI ushers in its winter tourism season 2021/2022 it is a delight to see many new properties, yachts and services ready to welcome back our guests. The Pandemic has raged now for nearly two years but it gave businesses an opportunity to hone their services as well as to enhance the infrastructure of tourism. Let us take a “Virgin Gorda tour” of what’s new and exciting on the horizon this season.

We see the rebirth of Rosewood Little Dix Bay (rosewoodhotels.com), the grande dame of BVI tourism complete with butler service and suites with those must experience plunge pools. Saba Rock (sabarockbvi.com) hosted its grand reopening early in the fall and features 5 deluxe ocean rooms as well as 2 suites with stunning views of the coveted North Sound. As small as this little island is, they have all of the amenities complete with 2 bars, dive shop, spa and boutique.

Bitter End - Best Resort in Virgin Gorda, BVI | Bitter End Yacht Club (beyc.com) - makes it grand and long awaited entrance with the BVI first over the water bungalows coupled a brand spanking new marina. The North Sound area is buzzing this winter with many yachtsmen and return of super yachts rediscovering this superb anchorage. So much is happening in North Sound that reestablishes its dominance as the gathering spot on Virgin Gorda.

Left: Rent a beach chair and umbrella for the day, have the signature BBC and enjoy the scenery at The SandBox on Prickly Pear Island Right: Savour the sea breeze while sampling global dishes bursting with fresh flavours at Nova Restaurant at Oil Nut Bay.

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Slightly offbeat and newly renovated is The SandBox, a local fun watering hole and for the upscale experience Nova Restaurant at Oil Nut Bay (oilnutbay.com) does not disappoint. They host a fabulous Sunday brunch complete with Caribbean Calypso Jazz musical infusions. New to the Marina Village in Oil Nut Bay is “his and her’ Arawak Boutique stores where guests can pick up an array of items. The Marina suites poised above are replete with every amenity and the villa collection a bit further east leaves no imagined luxury idea just an idea. Moskito Island has debuted its palatial estate homes that are available for the uber client with laid back luxury on their minds. Rounding out North Sound is Leverick Bay Resort and Marina (leverickbayvg.com) where extensive renovations are underway to include an enhanced Chef’s Pantry complete with its own butcher shop. The Spa at Leverick Bay will now include seven treatment rooms and all hotel accommodations are seeing an upgrade that will add kitchen facilities. New renovated villas are making a comeback such as Sea View, Sea Breeze, Alize and Rainbow’s End. Not to be outdone is the soon to be open Blunder Bay with full marina and restaurant. It will boast the only air conditioned sea side dining in Virgin Gorda. The Villa scene on Virgin Gorda is quite the rage. In fact a leading online publication just voted Virgin Gorda as the top villa destination in the Caribbean. Virgin Gorda Villa Rentals (vgvirgingordavillarentals.com) a premier luxury villa operator has added extensively to its portfolio where villas range from one to six bedrooms in exclusive areas to include Princess Quarters, Mahoe Bay, Leverick Bay and the Greater Baths. New to their portfolio are Amani Villa, Mon Repos and Amateras redefining the Virgin Gorda Experience. Guavaberry Vacation Homes has completed their renovations as well and Villas Virgin Gorda have also added to their villa cache. The Foodie scene has also heated up with Street Food and authentic Virgin Gorda cuisine becoming quite popular. From The Jerk Pit to Mama Africa to Lawrence’s Organic Market there is something to tempt every palate. Road side kiosks on Millionaire Street in Spanish Town serve up anything

A handsome residence with its large landscaped lawn and tiled roofs, Mon Repos offers plenty of room to relax.

Amateras is a stunningly beautiful luxury 5,000 square-foot estate villa that offers an unparalleled view of Virgin Gorda and the surrounding islands.

from mahi sandwiches to rotis to stewed lobster. Asian Fusion at Cocomaya, eclectic Caribbean at Mermaids and Fischers Cove, New Orleans bistro at Chex Bamboo and fine dining at The Reef House, Sugar Mill and Pavilion at Little Dix Bay as well as Leverick Bay Restaurant features upscale dining. Coffee shops have sprung up and the best coffees can be had at Cafesito located at Top of The Baths. Enjoy a taste of Virgin Gorda with a fun new foodie tour curated by White Oleander Destinations which also takes guests to local farms with stops at smoothie and juice stands along the way. whiteoleanderdestinations.com

The Restaurant at Leverick Bay offers a perfect evening dining experience with a unique mix of elegance, excellent local seafood specialties, the best house cut beef, and fresh Anegada lobster in the British Virgin Islands.

Hikes and special curated events retain their popularity in the BVI and Virgin Gorda is the perfect location to enjoy something offbeat that will create memories of a lifetime. Indeed this is the time to visit Virgin Gorda whether by yacht or an overnight stay. Virgin Gorda is always gem. Explore by jeep, minimoke or even electric scooter and on the water a catamaran or speedboat daysail can take you to the still dreamy secluded beach.

Sharon Flax Brutus

Fusing delightful flavors of South East Asia & Latin America with a touch of Caribbean, the CocoMaya menu is careful, exotic, fresh, vibrant, playful, and delicious.

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Launch of JOMA’s Waterfront Park and the Development of the Oleander and Coco Plum Buildings

offering office and retail space with a planned completion date in the fourth quarter of 2022. Speaking at the launch of Waterfront Park, the new name for the re-developed area last fall, Colin O’Neal, Chief Executive Officer of JOMA (Properties) Ltd. announced the plans for the estate. “In 2016, we began to develop plans for the redevelopment of the estate. We worked with our then in-house architect, the very talented and creative Margarita Peña Gómez to design a series of buildings to meet our vision for a hotel and marina complex and a reimagined office and retail sector at the eastern end of the property.” The western end of the property is carded towards investment in hospitality projects with a properly developed marina and a small hotel. With the view that the long-term future of the BVI depends on the continued development of the hospitality sector – a hotel would support both the marina as well as provide much needed capacity in the business hotel market.

JOMA (Properties) Ltd. a leading real estate developer in the British Virgin Islands has its roots in a business founded in the 1930s by J.R O’Neal a pharmacist who then built a widely diversified business with his wife Marie. The second-generation family-led company has developed landmark office buildings and other commercial space for a growing BVI economy. JOMA has a proven history of delivering standard-setting asset transformations that create long term value and deliver high-quality products to their tenants, aiming for a build quality that equals the best found in the region and have consistently been able to deliver “Class-A” commercial buildings in the territory. JOMA currently owns and manages a portfolio of over 200,000 sq. ft of leasable space around the Road Town area. The real estate company is now focusing on the re-development of waterfront property located at Port Purcell. The launch of Waterfront Park, the re-development of the company’s Port Purcell Estate will be no exception, beginning with two buildings

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The flagship of the development – Road Harbour Marina is JOMA’s largest-ever project and is being designed by OBMI. This involves upgrading the existing and the construction of a full-service 50-room “four-star” business hotel with restaurants, meeting facilities, and other amenities. At the eastern end of the estate are the buildings of Port Purcell East – Oleander and Coco Plum. These buildings are low-rise commercial buildings suitable for retail and offices. These buildings are designed for resiliency and versatility. They will be set amongst attractive landscaping, with attractive elevations from all four directions and with access to ample parking. Located on Blackburn Highway, Purcell, Tortola, Waterfront Park has excellent road links to Road Town, the airport, with numerous businesses and restaurants nearby and will offer excellent access to the entire city, while providing a controlled working environment. For further information on this development and interest in leasing, JOMA (Properties) Ltd can be contacted at 1-284-394-7171 or leasing@jomaproperties.com

The story is in the details. With roots in the BVI for over 50 years, OBMI

Marvin Flax

has held an outstanding reputation for

Managing Director

creating sensitive, unique, and appealing

mflax@obmi.com

designs within tropical environments. From

284.494.2148

conceptualization to built reality, we devote

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What’s trending in villa design at a local & international level By OBMI

hile the need for privacy and a sense of escape have been top considerations of the high-net-worth individual’s travel and real estate checklist, the pandemic has caused a surge in interest for secluded retreats across the board. With its warm weather, isolation, and low COVID-19 infection rates, the Caribbean is more in demand than ever among investors and second-home seekers. Just as buyers in the Unites States markets have shifted their property searches to larger spaces and commensurately increased their budgets, the villa market in the Caribbean has also experienced an increased demand from new buyers and existing owners looking to build their safe haven or upgrade their existing property to meet growing consumer demands. This has given

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Rainbow and Halo Guest Villas in Oil Nut Bay | Virgin Gorda

designers a shot in the arm with a renewed focus on creating unique features and crafting a space that will meet the owner’s long-term needs. In the BVI villa market, we see a few different types of buyers showing interest. The two most popular buyers are families seeking a legacy space and investors looking to design an appealing rental property that can rise above the competition. No matter the buyer, great villa design should provide the feel and comfort of home, but in a tropical location where guests or owners can stay for extended periods while maintaining routines. Naturally, every home design should be highly functional and a little bit indulgent, but this is exceptionally true when creating a “home away from home” vacation property or a top tier rental experience.

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Choosing a private site

Design with mother nature in mind

When looking to purchase a property, a homeowner that places a high value on privacy should consider peninsula and cliffside locations. Homes built on a peninsula provide a feeling of being on a private island with unobstructed ocean views, while still having easy access to nearby amenities. The Caribbean’s mountainous terrain offers the opportunity to conceal homes with the surrounding nature by building into the cliffside. It’s essential to work with your architect to balance the built environment and the natural environment without dominating the landscape during the design phase.

The true experience of “getting away from it all” includes an immersion in the local environment. As architects, we love the challenge of creating a vacation home that has all the creature comforts of our modern world while simultaneously embracing the environment, climate, and culture. In the Caribbean, this means utilizing natural materials that incorporate the colours found in the natural environment, while the interiors feature broad expanses of glass to showcase the hues of the sea. Glass walls, multi-level living spaces, local stone cladding, wood details, and copper roofs not only embrace the climate but make it seem like the home was always part of the landscape.

Owning a luxury villa in the Caribbean may be the dream for those looking to escape the pandemic, but for the ultra rich, they have set their sights beyond the standard villa to the idea of owning a private island paradise. Although creating a self-sufficient island is no easy feat, this type of buyer wants the ultimate assurance that no one will cruise up and infringe on their isolation. OBMI CEO, Doug Kulig, shares some crucial steps to successfully developing private islands through his years of experience. Kulig suggests completing the myriad approvals for regulations, restrictions, and processes prior to purchasing. Figuring out what you want to do with the island is the more fun part of the development process. Do you want the house designed as an informal bungalow with indoor/outdoor spaces, or do you want something more formal? “We talk about lifestyle,” Kulig says. “When are people going to use the island, and how are they going to use it? It’s more than just whimsy. If you’re considering a wooden beach-house type of structure, you want to consider storm impacts in the area,” says Kulig.

Above all else, preserving our natural environment is a top priority, and land across the BVI presents unique conservation challenges. Virgin Gorda’s legendary boulders can offer a fun opportunity to incorporate them into the overall aesthetic rather than removing them. As seen in Bayhouse Villa, the sleek architecture is sharply defined against the softer surrounding landscape, offering a dynamic contrast while preserving the natural surroundings. The mountainous terrain of the region presents as many design opportunities as challenges. Large green roofs are a smart design feature to retain a portion of a mountainside while also aiding in capturing water runoff. In the plan of Oil Nut Bay’s The Cliff Suites, OBMI incorporated biophilic design strategies by including a natural living green roof. By thoughtfully planting native vegetation, the design lessens the environmental impact on this dramatic natural setting. Sitting in an elevated position above the island’s renowned beaches, positions a villa to be a stunning secluded retreat. A great layout to accommodate a variety of living areas and bedroom suites is a design with a series of private, stepped pavilions capturing the feeling of indoor and outdoor Caribbean living. With all the elevated properties and limited availability of beachfront properties in the BVI, large outdoor terraces with a private pool are still among the most highly requested design features and methods to embrace gentle sea breezes and capture the breathtaking expansive views. Villa Maronti in Oil Nut Bay | Virgin Gorda

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New trend for master bedroom suites The master suite is more than a suite – it’s a sanctuary, calm and cool. New constructions are now featuring master suites with their own office and media room, often completely isolated from the rest of the residence. To reach these private sanctuaries, we have been incorporating covered breezeways with access stairways that lead to shared spaces and additional expansive bedrooms. Today’s competitive market calls for each bedroom to feature bright, natural light, spectacular views, and the newest mandates of en suite baths and private outdoor terraces. While we still see the standard villa include anywhere from three to five-bedrooms, one growing trend we have incorporated into recent designs is a residence with dual master suites. For permanent residences, this is a great solution to accommodate multi-generational families. For vacation homes, this is an excellent resolution to host friends comfortably while visiting the island.

Prioritizing wellness Today more than ever, we understand and appreciate the need to tackle the tough task of bridging the gap between the desire for connectivity and ease with a need for rest and “unplugging” that our society craves. Wellness and a healthy lifestyle are undoubtedly one of the dominant trends in vogue around the world. As awareness and attention to health increases, so does the demand for the buildings in which we live, work, and play to be designed to improve health, mind, and well-being. As the collective shifts towards a new holistic well-being model, homes beautifully designed with wellness at their core and centred around a healthy lifestyle are in high demand. By now, we all know that low access to daylight can be detrimental to our health. Passive lighting, ample windows, or lighting that imitates daylight are easy ways to boost occupants’ general wellness and increase productivity. Kitchens will increasingly be designed to store and even showcase fresh, organic products. We may see some changes in the coming year: the walk-in pantry transforming into a walk-in hydroponic farm and large interactive centre islands with several designated stations for food prepping, cutting, and dehydration, an essential method of cooking for vegans. Along with eating well and spending time in or around nature, fitness is essential to mental and physical health. In-home gyms’ current trend is acquiring less equipment but filling the space with machines that focus on functional movement and concentric fitness, emphasizing recovery and stretching. OBMI Chairman Tim Peck recently discussed how wellness is being approached differently at the firm. Far beyond the idea of a typical spa concept, he revealed OBMI’s designers are looking into the idea of biohacking as the next wave in wellness design. “For so long a variety of fields have focused on improvements to the physical body as the quickest method to improve human health. However, research digging into biohacking has pointed to our biology’s intangible chemical factors, such as emotions and thoughts, as the most impactful way to alter our wellbeing.” noted Peck. “By gaining a better understanding of the way in which our systems work together, we as designers can now interject and tweak these dials of thoughts and emotions to create spaces that properly stimulate and enhance our overall health. A novel idea that we are excited to continue to explore.”

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Casa del Cielo | Cayman Islands

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Villa Maronti in Oil Nut Bay | Virgin Gorda

The Cliff Penthouse Suite in Oil Nut Bay | Virgin Gorda

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Villa Nevaeh in Long Bay | Anguilla

Bayhouse Villa in Crooks Bay | Virgin Gorda

Waters Edge Villa in Oil Nut Bay | Virgin Gorda

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Technology integration When thinking about incorporating smart home technology into the design of a vacation home or rental villa, it’s best to consider how often it will be used and the areas that will be utilized most often. If entertaining is an important part of the desired lifestyle, ample space, and unique technological touches can make a home extraordinary. As technology forges ahead at breakneck speed, there are numerous ways to incorporate these new features into homes that make living in them easier, safer, and more affordable. Saving on utility bills is a simple way to enjoy smart home technology. From learning thermostats to smart light bulbs that automatically turn on and off depending on a room’s activity, it’s obvious how these technologies could be especially beneficial in a rental home. Security cameras that can be accessed via smartphone or tablet while away from the property can also allow for peace of mind when the house is not occupied.

About OBMI: OBMI is a global architecture firm widely celebrated for creating distinctive designs for high-end hotels, luxury private residences, and engaging urban areas. Since 1936, our mission has been to collaborate with clients to transform their visions into three-dimensional forms that are authentic to their location and incomparably marketable. Through several global design studios, we offer an integrated approach that combines responsive design strategies, the latest innovations, and technical expertise to create experientially memorable, environmentally responsible, and financially successful destinations.

Heading home In the ever-evolving world of design, it can be challenging to stay on top of the latest trends. Villas are where you can spend a relaxing vacation amidst an organic setting. In the BVI, designers will always look to create more open spaces for free movement of air and light so that owners can connect with our beautiful landscape. As a homeowner, when looking at where to invest in your design, it always pays off to focus on solutions that cater to the wellness of those who occupy the space and preserve the surrounding natural environment. | BB

Villa Maronti in Oil Nut Bay | Virgin Gorda

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LOCAL BUSINESS

Construction in the BVI: Industry update & forecasting for 2022

By MARVIN FLAX

n 2021 the BVI construction industry faced a perfect storm of challenges, driven mainly by the COVID-19 pandemic. Long lead times, higher than average raw material price increases, and the economic and geopolitical uncertainty based on the yet-to-be-cert concluded commission of inquiry. In addition, the territory was still closed to visitors. Generations-old economic principles such as supply and demand are squarely at play globally, and the BVI is no exception to these forces. In past construction updates, we touched on the status of the various resorts that most have or have been undergoing renovations from the ravages of Hurricane Irma, dating back to 2017. I have touched on the status of the diverse BVI Government and Recovery and Development Agency projects. This update will identify several promising opportunities in the 2022 pipeline. This article will also touch on the current impact on the construction industry from the pandemic. Ideally, governments don't want to be in the construction business under normal circumstances, and they tend to let the free market set the pace. Four years since Hurricane Irma devastated the territory, the BVI Government had to greenlight many construction-related projects that are primarily reconstruction efforts. Most of them are infrastructural, but they also solve long-standing challenges they faced before the 2017 hurricane season. The ruling party also addressed a COVID-19 stagnant Pandemic economy with many construction-based economy-boosting initiatives.

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As an architect, I am on the frontlines of the construction industry. My role interfaces with all lines of construction businesses and trades, such as hardware stores, realtors/property managers, procurement officers, shipping and freight companies, material suppliers, general contractors, electricians, plumbers, airconditioning suppliers and installers, property valuators, land surveyors, quantity surveyors, developers, property owners, project and construction managers and The BVI Government procurement teams. That list gives some insight into some of the many businesses impacted by construction. Most contractors I interviewed have a positive outlook for 2022. The positivity is also met with caution due to the tremendous uncertainty from the long lead times for most materials. In addition to the lead time issues, the cost increases have soared. Increased demand met with labour shortages and a diminished supply have led to 30% increases in lumber, plastic, metal, and glass. Most experts predict that there will be further increases in raw materials. Still, prices should come down by the end of Quarter two of 2022. Inventories will have to improve before suppliers can consider lowering their prices. An increased stock creates more competition, thus reducing costs. Consumers won't see the savings right away, however. In the most recent recession brought on by the global financial crisis, building material suppliers started to increase their inventories from April 2007. Still, it took until quarter three of 2008 to see sustained reductions in sale prices. “The Great Resignation” is a term that we have read about on many U.S.-based media entities. Fortunately, this has not impacted the local construction labor market yet. Most contractors can find the necessary labor to fulfill their project demands. After the passing of Hurricanes Irma and Maria, the Government of the day relaxed work permit regulations to allow for droves of construction-related skills on the island. This policy has since ceased, and the territory has maintained a steady labor pool, leading to stable prices that contractors can rely on to set daily rates and project budgets. Delays in work permit processing can potentially diminish the available and legitimate local

workforce, thus increasing the daily rates for every trade. Reports of gridlock at many port facilities contribute to already stretched supply chains. Hundreds of cargo vessels continue to meet delays in offloading their containers due to jammed ports. The ports worldwide are jammed due to storage shortages in Seattle, Los Angeles, Long Beach, Miami, and Boston. Ports in China and the United Kingdom. This situation has impacted some shipping companies that serve the BVI with reports of container shortages which have led to delays in contractors and hardware stores receiving materials. For example, high-end kitchen appliances and plumbing fixtures take 5-6 months before they are shipped to most South Florida shippers. The procurement issues create many challenges for contractors. Many are forced to lower their profit margin to secure work and cash flow. This leads to loss-generating projects between 2-4% profitable, which ultimately is not sustainable. Another challenge to the local market, to meet project schedules tied to financing; upon contract signing, home builders may be forced to pay upfront for long lead time items like doors and windows, which can easily account for 10-15% of overall home build costs. That is a separate cost from mobilization. The reality is that many first-time homeowners will not be able to afford it. If they wait, they risk having an unfinished and semiopen home for months until the doors and windows arrive. For example, according to most suppliers, an average order can take 20-28 weeks for fabrication. Resorts and hotel pipeline: Long Bay paused its reconstruction and opened a new restaurant and renovated some of the existing beachfront units. Bitter End,

which Hurricane Irma ravaged, went thru a major renovation and recently had a soft opening. Saba Rock reopened in Q3 of 2021 with rave reviews. Biras Creek's development plans have been approved by the Public Works Building Authority and recently completed a new dock as phase 1 of their reconstruction. Oil Nut Bay continues to buck all the trends, recently submitting several new applications to the Town and Country Planning and Public Works Building Authority department. The residential-based resort has multiple villas in various stages of construction. Oil Nut Bay's approach is a bit unique. They provide many of the construction materials that the contractors need, so in essence, contractors are only required to provide a labor and install quote. With its 125 acres, Mosquito Island recently opened with three high-end estates with many more on the drawing board. New developments like JOMA's Port Purcell East Development and Road Harbour Marina are promising new developments that will be sure to employ dozens of construction workers and add thousands of class A office and retail square footage to the market. With JOMA Projects as their construction arm, JOMA has successfully diversified to be more than real estate owners and property managers. BVI Government continues to lead and promote the local construction industry. Decisions like extending the stamp duty waiver for land purchases and rolling out several tenders thru the Recovery and Development Agency have been successful and impactful. The stamp duty waiver generated a property buying frenzy of which some were hurricane damaged. This also leads to increased applications to the Town and Country Planning Department. Some of the new home and landowners hired architects and engineers

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to aid them in their reconstruction or recent design efforts. The chief planner and his team continue to be bright spots in facilitating the construction industry despite the challenges brought on by the pandemic. In Quarter three of 2021, TCP received 89 applications. Quarter four numbers are expected to be even higher as end-of-year enthusiasm for development is usually heightened. The BVI Central Government Procurement Team, thru the Ministry of Communications & Works, is spearheading many projects, including the R.T. O'Neal Administration Complex reconstruction. The first phase of that project is the glazing installation work and interior demolition. Phase two is the reconstruction of the exterior stucco façade; phase three is the addition of a new elevator, and phases 4 and 5 are for new mechanical, modern I.T., and electrical systems. The review board is presently evaluating tenders for the elevator and façade rebuild. Each tender saw five contractors submit detailed cost estimates. With more phases of work to be done, expect more opportunities for contractors.

and a long-term vision to reduce the territories fossil fuel dependency. The BVI Electricity Corporation Headquarters on Virgin Gorda is targeted to be the first LEED accredited building in the BVI. With tax incentives, the Government has an opportunity to require a percentage of all new public buildings to be LEED accredited, which can be attractive to building owners who are looking to reduce their upfront build costs while doing their part to help the environment. This will lead to future contract signings for a myriad of solar panel installations on all schools and Government-owned and operated facilities. This focus will create more construction-related jobs and capacity.

In addition to the R.T. O'Neal Complex rebuild, the procurement team has the National Sewerage Project focusing on the Cane Garden Bay and East End Long Look areas. In addition, The Huntums Ghut Economic Zone, Market Square, and North Coast Revetment projects are in its portfolio. In his budget address, the Honorable Premier has allocated 15% of the overall budget to the myriad of construction-related projects the territory needs. The education sector will see a significant injection of funds to upgrade every school. Each of these projects will be tendered, thus increasing opportunities for local contractors.

The Recovery and Development Agency has spent $29.9 million USD since its formation in 2018. In 2021 (7) projects were completed, creating 14 additional project activities. Most of these projects are infrastructure-related with road stabilizations and rehabilitations, but this year saw two significant proposals for design and engineering activities. 1. The West End Ferry Terminal which is expected to break ground in Q2 of 2022 and 2. The Elmore Stoutt High School Redevelopment are both highly anticipated projects that many in the industry expect several contractors will tender on. The CEO stated that 81.6% of contracts signed thus far were awarded to local firms at a recent contract signing. 9.7% for international firms and the remainder to regional firms. If the Caribbean Development Bank is financing the project, then the banks’ lending countries, like Germany, Canada and the UK for example, are permitted to tender. This was the case with the West End Ferry Terminal, where a German design and engineering firm was ultimately successful. This does put local firms at a disadvantage.

Also mentioned in the budget address was a renewed focus on renewable energy

The ongoing airlift issues that have plagued the BVI for decades are an existential threat

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to the survival and growth of the tourism sector and, by extension, the construction industry. The RDA has been tasked with the expansion of the Terrance B. Lettsome International Airport. This is welcomed and exciting news to locals and foreign investors alike. The BVI is the only jurisdiction in the Caribbean that does not have direct airlift to the United States. If the runway can be extended, large carriers like American Airlines, Delta or US Airways will provide direct access from Miami, Atlanta and Chicago. Direct air access will have a major impact on our local economy and financial services industry. Investor confidence will rise and can lead to increased hospitalityrelated development and by extension, construction-related opportunities. The BVI has an oversupply of villas for ten-plus years, and this has significantly slowed down the pace of high-end villa construction. Many foreign buyers also took advantage of the local property buying frenzy, which we hope will lead to a mini boom in the luxury end of the construction market. The Commission of Inquiry has yet to state the outcome of the months of public inquiries and private investigations, but foreign and local investor confidence has still been shaken to some degree. The local economy is fragile after twenty-plus months of pandemic created stagnation. Regardless of the final determination, the territory is ready to get past this chapter in our history. The BVI construction market is diverse and has several opportunities, but many don't specialize in one area. There are opportunities for specialist contractors to separate themselves from the many local companies fighting for the same small supply of work. Options like solar panel and windmill power generation which now has the support of the BVI Government should create skilled jobs and a boost to the local economy. As big as it is, the marine construction sector only has one skilled contractor with the necessary equipment, which is why they tend to get most of the marine-based structures. Local construction companies can pool their resources to compete. There is across the board optimism for the year ahead, led by so many economydriven construction projects in the 2022 pipeline. | BB

SPECIAL SECTION Dr. Robert A. Mathavious

Nation Builder Nation Builder | A Talent Pipeline | The Strategist and the Kingdom of Pasea | BVI Soft Power

INTRODUCTION

“Chancellor, in an epoch where the world is firmly in the clutch of globalisation, whilst the vexing and disquieting issues of white collar crime present considerable apprehension for Small Island States in terms of regulation, compliance, and money laundering, Robert A. Mathavious stands tall and tenacious as the legendary and imposing “Rock of Gibraltar” in the British Virgin Islands. To be sure, in light of his endurance, in the battle of good governance, compliance, regulation and transparency, no one could find fault with Robert Mathavious and his dedicated team of “soldiers”- which he has nurtured at the British Virgin Islands Financial Services Commission since 2002 - if they adopted the motto of Gibraltar itself:

Nulli Expugnabilis Hosti (“No Enemy Shall Expel Us”)

These were the opening lines read at the University of the West Indies, St Georges, Grenada Open Campus, on 12th October, 2013, the day the University conferred upon Robert A. Mathavious the Degree of Doctor of Laws (LLD).

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he Virgin Islands’ Financial Services’ “Rock of Gibraltar” he surely is, but he has also become a father to more children than his only biological child and he is also the warm and caring husband to a wonderful and supportive wife. To understand what makes Robert A. Mathavious tick, we listen to him in his own words:

“I come from a small country, where any person not reaching his or her full potential is a big loss to us. My parents instilled that kind of attitude in all of us. But equally, by faith, I’m a Christian and foolishly, I have this drive that maybe I can help everybody. My thing is to help anybody…try to see people move from where they are to becoming something better.” That drive of which he spoke to help everybody, was somewhat prophetic and telling as, in many and unobtrusive ways, he helps others as he stands at the helm of the rocky ship that is the financial services industry. Yet, we have seen smoother days of sailing for a small-craft country although the seas are often rough and perilous, still the territory stands on a firm footing to enjoy a comfortable standard of living supported by this very industry. Speaking to Robert, you will find him to be straightforward and resolute; yet, he can easily and effortlessly insert an anecdote if it would abet his argument. nce he was asked what was his biggest accomplishment. He never O answered that he had played a fundamental role in drafting the legislation which set up the Commission, by way of the Financial Services Commission Act of 2001 and that, in so doing, he had lifted the territory’s (and, by extension, the region’s) reputation as one of the better-regulated jurisdictions in the world; or that the BVI is not a regular fixture on any negative list, having passed the IMF and other tests with flying colours many times. He didn’t even answer that his biggest accomplishment was receiving the honorary Doctorate degree from the University of the West Indies. His biggest accomplishment was this: 140 employees at the Commission, a number of whom had come fresh out of college and were now regarded as experts in their own respective fields, and internationally acknowledged to boot. All thanks, in large part, to Robert A. Mathavious’s leadership, his guidance, his passion, his coaching, his vision. He is a man who has risen to his rank over time; he has been tested, tried and has proven repeatedly that he is a stalwart in the territory. But, of course, the territory knew that way back when he served as Deputy Financial Secretary from 1980-1985, as Financial Secretary from 1985-1991, as Director of Financial Services from 1993 to 2001 and when he was honoured with the Rotary Club of Road Town’s Citizen of the Year award 1994-1995. The territory may not have seen his nine acting appointments as Governor between 2015 and 2017 coming, but, given his unquestioned and unquestionable level of integrity and his demonstrated penchant for probity, no one would have been surprised.

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The world has sought after him to speak on his discipline many times and when he is not presenting on the global stage or leading his band of “soldiers” at the Office of the British Virgin Islands Financial Services Commission, you can find him as a faithful and humble servant of Christ in the Methodist Church, Road Town congregation, as a Congregational Steward or as a member of the Resources and Development Committee. His one other passion is putting to use that God-given bass in the Old Timers, an allmale choral group anchored in the Road Town congregation but comprised of interdenominational membership. Robert A. Mathavious, appropriately called “the legendary and imposing ‘Rock of Gibraltar’ in the British Virgin Islands,” stood tall and tenacious for just shy of two decades as captain of the ship called The Financial Services Commission. On the journey to that position, he contributed liberally to the ship of state. He now retires after nearly half a century of service to his beloved British Virgin Islands. He will be greatly missed, but he has done his work and has been exemplary. In the words of Longfellow: “Lives of great men all remind us, we can make our lives sublime and [retiring] leave behind us footprints on the sands of time. Business BVI is very pleased to present this Special Section, designed to reflect on Dr. Mathavious contributions to the financial services sector and the wider development of the BVI. It is intended to place centre stage, an initial, but far from exhaustive glimpse into some of those contributions through the eyes of industry leaders from a local and global perspective. The section is filled with insights, ideas and thoughts from key leaders in the financial services space in the jurisdiction and overseas. It is but a peep into the backstory of how the BVI became a significant facilitator of globalisation and frictionless cross border trade. A role which has aided in lifting hundreds of millions of people out of poverty and into the global middle class, from China to the wider Asia community, to India and many African countries. We hope that it will connect some of the dots on how the transformational International Business Companies Act of 1984 and its successor, the BVI Business Companies Act of 2004, led to the jurisdiction’s transformation from a little sought after, low-tax centre to the thriving leading international finance centre today. It is almost impossible to fathom what the BVI financial services sector would have been like, had there been no Dr. Robert A. Mathavious. So voluminous, varied and consequential were his contributions. For a wider view, we must train our lens and wonder what the quality of life in these Virgin Islands would be like today without the game changing, direct yearly financial contributions of the sector, to the public purse. Today, those contributions equate to approximately 60 cents of every dollar in the territory’s annual budget, which approximates some $400M, and given the territory’s current economic challenges resulting from COVID, that percentage is invariably much higher. At Business BVI, we believe that only a very small handful of persons may, and we stress may, have directly or indirectly contributed more to the economic wellbeing of these islands over the last two plus decades, than Dr. Mathavious. As Robert steps off the global stage, it is not an exaggeration to say that, he takes with him a substantial chunk of the global soft power of the British Virgin Islands.

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DR. ROBERT MATHAVIOUS AN UNDENIABLE EXAMPLE OF WHAT OUR VIRGIN ISLANDS PEOPLE ARE CAPABLE OF ACHIEVING By Hon. Andrew A. Fahie Premier and Minister for Finance

am pleased to pay tribute and to say thank you to one of this Virgin Islands’ most brilliant professionals, who has dedicated his lifetime to public service, and who has held some of the highest offices in this country, performing with distinction. Dr. Robert Mathavious is recognised as a pioneer and innovator of the Virgin Islands’ Financial Services Sector. He has been one of the key driving forces behind this industry, which is one of our two main economic drivers, and which has provided sustenance and myriad opportunity for our people for almost four decades. Dr. Mathavious, a proud Virgin Islander in whom we are proud, has led our financial services sector for three of those four decades. After almost 20 years at the leadership of the Financial Services Commission, he retired effective December 31, 2020. The holder of a BSc in Economics from The University of the West Indies and a MBA from Georgetown University, Dr. Mathavious served as Financial Secretary for the Government of the Virgin Islands from 1985 to 1991. During his tenure, he chaired an ad-hoc committee that developed the draft legislation of the Banks and Trust Companies Act and the Company Management Act, both of which were enacted in 1990.

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Dr. Mathavious is the embodiment of this wisdom and selflessness and even after retirement, a great part of his legacy continues to live on. Dr. Mathavious was appointed as Director of Financial Services in 1993 and was charged with the development and regulation of the Financial Services sector. He consequently, played a critical role in the design of legislation to establish the Financial Services Commission, through the Financial Services Commission Act of 2001, and was thereafter appointed to the post as Managing Director and Chief Executive Officer of the Commission in 2002, on the recommendation of the Board of Commissioners to the Government fo the day. Dr. Mathavious has also served as the inaugural Chairman of the Recovery Development Agency, Acting Governor, Financial Secretary, to name a few of the most senior Public Service positions. Dr. Mathavious, a true Virgin Islands hero—our inspiration. In 2013, Dr. Mathavious was conferred with an Honourary Doctorate by the University of the West Indies Open Campus in recognition of his stellar contributions to Caribbean development in the field of Financial Services.

Financial Services Industry practitioners, locally and many abroad, owe Dr. Mathavious a profound debt of gratitude for his extraordinary service, leadership and mentorship. Not only did he help to cultivate and grow this most important sector, but he also moulded and trained many professionals. While there are many prominent voices in the Financial Services space in the Virgin Islands, Dr Mathavious is regarded as the father or the guru of the industry. And his Honourary Doctorate from UWI stands as indisputable testimony to this. Over the years, Dr. Mathavious has also contributed significantly to a number of professional Boards. He has been a member of the Financial Investigation Agency Board, the FATCA Negotiating Team for the Virgin Islands and the Tax Information Exchange Agreement Negotiation Team for the Government of Virgin Islands. He is a Fellow of The Offshore Institute (1990) and received the Rotary Club of Road Town Citizen of the Year award for 1994-1995. There is a Greek proverb that says, “A society grows great when old men plant trees in whose shade they know they shall never sit”. Dr. Mathavious is the embodiment of this wisdom and selflessness. I was pleased when he was honoured by the New Life Baptist Church in 2014 as one of the Virgin Islands’ unsung heroes, for his outstanding work as the premier professional within the Financial Services Commission, and for securing the integrity of the industry from which the entire Territory largely benefits. I can vividly remember his response to this recognition. He said: “I come from a small country where any person not reaching his or her full potential is a big loss to us. My parents instilled that kind of attitude in all of us, but equally by faith I am a Christian and foolishly, I have this drive that maybe I can help everybody. My thing is to help anybody…try to see people move from where they are to becoming something better.” I want these words to be recorded in our history books to show the level of effort that our Virgin Islands leaders have been making and the deep desire of our people to truly become self-determining. The life-long effort, sacrifice, investment and dedication of our Virgin Islands heroes, sung and unsung, has been to develop our people and our country so that we can be the masters of our destiny, and so that our destiny would be secure. A great part of Dr. Mathavious’ legacy will live on throughout the rest of time in those able professionals whom he has shaped through his leadership, tutelage and foresight, and those touched indirectly by the fruits of his work. Many of our bright stars in the Financial Services – and we have many who came in as juniors and today are Deputies and Directors – would have been able to develop and mature under his wings, or through his initiatives. The Financial Services Industry is our industry and he has prepared them to carry the baton forward. He has always been a key advocate and champion of the Financial Services Institute at HLSCC now renamed his honour - The Robert Mathavious Institute. He has always believed in shaping and moulding Virgin Islanders for the future, and to take charge of their destiny. He shaped them not to be loyal to himself; but to be loyal to the Territory and to be capable of running their financial industry competently when their time comes. He is yet another undeniable example of what our Virgin Islands people are capable of achieving.

He is living proof of our intellectual, academic and professional abilities. His achievements and his example are world class. In fact, his achievements are beacons for all of us to believe in ourselves and our people, and for us to have faith in lifting up our people. The sky is the limit for Virgin Islands people; we just have to believe in ourselves.

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On 10th October 2020, I joined with the Virgin Islands Community in congratulating Dr. Robert Mathavious, LLD on receiving the Order of the British Empire (OBE) recognition from Her Majesty the Queen Elizabeth II for his unwavering services to the British Virgin Islands. In personally extending congratulations to Dr. Mathavious on this new honour, I thanked him for his commitment and expressed that this recognition is yet another undeniable example of what our Virgin Islands people are capable of achieving. The OBE award came under the heels of a statement I made in the House of Assembly during the Tenth Sitting of the Second Session of the Fourth House of Assembly on Friday, June 19, 2020 titled: “Appreciation – Dr. Robert Mathavious, LLD”.

Financial Services Industry practitioners, locally and many abroad, owe Dr. Mathavious a profound debt of gratitude for his extraordinary service, leadership and mentorship. At the time, I was advised that Dr. Mathavious, after almost 20 years at the leadership of the Financial Services Commission, had indicated his decision to retire from the Commission, effective December 31, 2020. Dr. Mathavious is the embodiment of this wisdom and selflessness and even after retirement, a great part of his legacy continues to live on, as I get an opportunity to interact with his successor Mr. Kenneth Baker and the rest of the team he has developed. I want to again thank him for his long and illustrious service. I want to thank him for everything he has done for the Virgin Islands, both in the past and in terms of the future impact that he and his work will continue to have for generations. I am indeed pleased to see him honoured for his commitment to the development of the Virgin Islands in this notable way. I want, on behalf of the Government and people of the Virgin Islands, to wish him happiness. May God continue to order his steps.

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The Financial Services Commission Act, 2001

A LEGACY BUILT ON TRUST By Ray Wearmouth

y the time Robert A. Mathavious became the inaugural Managing Director of the Financial Services Commission (FSC) in 2002, he had already enjoyed a long and distinguished career in public service. Between 1980 and 2001 he had built a stellar reputation in three key roles, moving from the Deputy Financial Secretary, to the Financial Secretary and then finally to the Director of Financial Services. By the time the new millennium had started in earnest, he was a long-established leading figurehead of the British Virgin Islands (BVI) financial services industry. Dr. Mathavious was universally respected, held in high esteem and regarded as a visionary for the future of the industry. So when it was time for the architecture and framework of the FSC to be established, and then built, he was the natural and obvious choice for that undertaking. Over the next 20 years he would add layer and layer to the platform of trust, confidence and integrity that he had already built. Along the way, Mr. Mathavious would become Dr. Mathavious, and Dr. Mathavious would become Dr. Mathavious, OBE. We will take a brief trip back in time over those two decades where Dr. Mathavious and the FSC were inextricably linked and indelibly synonymous with one another. We will also borrow some of Dr. Mathavious' own words to add some perspective. Anyway, let's start by going back to 2001.

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The Financial Services Commission Act, 2001 (Act) was assented to in late December and came into force on Monday 31 December 2001. The FSC was legally born. It is not quite ancient history, but at that time the Beef Island Airport was coming to the end of its natural life, ready to be replaced by the impressive new terminal at the soon to be renamed Terrance B. Lettsome International Airport. There were no traffic lights in the BVI and there was no Commercial Court, no Commerce House and no Ritter House. There was no Maples, no Ogier, no Walkers, and no Appleby, just to name a few. The biggest registered agent, Offshore Incorporations Limited, did not have its own BVI offices. There were no handheld devices with email capability (this occasionally enabled, or required, what was called a "conversation", sometimes branching into whole minutes of discourse). But financial services was frenetic and the industry was getting busier and busier by the day. Industry regulation was now paramount and to stay in touch with evolving international standards, and to reflect the world's leading financial centres themselves, a strong leader was needed at the helm of the BVI's new Commission. As the page turned on 2001, and 2002 emerged, Dr. Mathavious was appointed as the first Managing Director of the FSC under section 10 of the Act, which also designated him as its chief executive officer. The FSC's own fortunes over the coming decades would be a litmus test and benchmark for the industry's international standing with the global standard setters, as well as the BVI's own wider standing within world trade. On numerous occasions, Dr. Mathavious has simplified the connected synergies of regulation and business with the easy mantra of "good regulation, means good reputation, means good business." The fortunes of the industry, and the BVI itself as a direct result, have seen this simple formulation be tested, and verified, with empirical data and outcomes, a number of times over that period. As the level of regulation across the world continues to multiply at exponential rates, this simple mantra remains a very fit for purpose governing dynamic for the industry to return to from time to time in coming years.

The start-up: industry in your hands "Start-ups" have been back in vogue in 2021, and certainly were in 2002. A small firm called Google had recently just got going. However, this start-up, the FSC, was very different. There was never any doubt back then that creating the FSC was a very necessary step. But what shape and form would it take, and what exactly was at stake? In hindsight, through 2021 glasses as we see the world now, everything was at stake, potentially. A misstep could easily alter the industry's trajectory and destiny in any number of ways. The enormity of the task was not for the faint-hearted even through 2002 lenses. The title of the Act is noted below, with some emphasis added simply to underscore what lay ahead and what was required: "An Act to establish a Financial Services Commission to licence, regulate, and develop the financial services industry in the Virgin Islands, to transfer certain statutory powers and functions to the Commission and to provide for other matters connected therewith.” So a small job then ! If Dr. Mathavious could get that "establishment" part done in the morning, he could then perhaps use the afternoon to turn his attention to how he might "develop the financial services industry". Might even be finished with the "other matters" by 5pm. Small job ? Hardly! This was never a bricks and mortar only exercise. Breathing life into the newly created autonomous regulatory authority, into which a very large portion of the BVI Government's direct revenues would first flow, required a very unique skill set and mind set. The level of trust in Dr. Mathavious at that time meant that the industry, and doubtless the Government of the day, really did not dwell on the enormity of what was, in fact, at stake. In many ways, both the industry and most of the Government's revenue, were now in the hands of the leader of the FSC. How he discharged his statutory duties and performed in his role could, and ultimately would over time, significantly influence the success of the industry, as well as the jurisdiction itself. This is not said lightly, nor is it an overstatement. Imagine where the jurisdiction would be today if Dr. Mathavious had not been the person with the Act on his desk, and the FSC in his hands, rhetorically and literally, in 2002? In the hands of the wrong person and team, it could have been a relative, or a very real, disaster. In the hands of anyone but the very best person, and best team, the chances of sustained success would be remote. We have much to be grateful, and thankful, for Dr. Mathavious will always point to the team who were with him and around him. They will always point back to him, noting his vision, unique skills, mind set and sustained leadership. Leadership which repaid the Government's, and the industry's, complete trust and faith in him over two decades. Career legacies are not always easy to define. In the case of Dr. Mathavious, however, they are not particularly difficult either. In the eyes of the industry, the FSC itself is largely reflective and emblematic of Dr. Mathavious himself. The way the FSC operates and what it stands for, are very much a continuation of how its core founder operated and operates, and what he stands for. His career legacy has been built with verifiable fact underlying the foundations,

so we are not going to venture away from that axiom of truth with even a hint of embellishment, romantic or otherwise. The above statements simply reflect what industry participants, both near and far, have said time and time again, without fail, for the last twenty years. If Dr. Mathavious' next chapter does happen to involve flying from rooftop to rooftop, wearing a cape or performing any magical powers, we will no doubt read about it (in Business BVI, we hope). But we will keep our feet on the ground for now and look at the concrete legacies that surround his career, by using the FSC itself as a mirror of reflection.

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Career legacies are not always easy to define. In the case of Dr. Mathavious, however, they are not particularly difficult either.

The mission, the strategic aims and the values The FSC's statutory functions, which are set out in the Act, add a plethora of responsibilities to its core regulatory raison d'etre and oversight. They are prescriptive and detailed. The joined up journey of Dr. Mathavious and the FSC is interwoven, starting with the landscape painted by the Act, but also showing itself in many other ways, some subtle, some less so. As the body corporate grew, its personality would emerge from the pages of the Act, resembling the standards of its founding leader. The FSC would soon formulate its own mission statement and strategic aims. It would later add its own values, in the form of pledges. The mission statement formulated early on by the FSC has remained consistent. It broadly summarises, in the FSC's own words, the key components of its statutory duties. The core mission is "to uphold the integrity of the British Virgin Islands as a well-regulated international finance centre and safeguard the economic interests of the territory… ". The mission statement goes on to explain how that will be done, in summary, by protecting the public and market participants, ensuring industry compliance with the highest international regulatory standards and by playing its part in the fight against cross-border white collar crime. In setting the mission statement many years ago, the FSC and its leadership clearly had a very good read on the likely direction of

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travel of the international regulated space, as well as the BVI industry's part within that wider space. The FSC's strategic aims continue to demonstrate that there is no destination in sight, just a journey of constant change to stay ahead of several curves. The strategic aims appear in the FSC's annual reports and shine a light on the breadth and width of the FSC's many roles, which continue to grow by the day. The nature and outlook of those aims simply confirms that the FSC's horizon scanning remains as sharp as ever. The visionary, strategic approach to regulation has been handed down. In fulfilling its mission and discharging its duties and aims, the FSC publicly pledges vigilance, integrity, leadership and accountability. Those pledges, and values, genuinely appear to echo throughout the whole of the FSC as an organisation, and loudly so. Palpable traits of Dr. Mathavious where actions always speak louder than words. After twenty years of carefully managed growth, the mature personality of the body corporate has taken on a great many of the defining hallmarks of its first Managing Director. Those hallmarks also resonate throughout the wider, longstanding leadership team of the FSC. As Dr. Mathavious moves onto his next chapter, the fruits of two decades of a very significant body of work are in very good hands. We would not really expect anything less as a conclusion, based on two decades of findings.

Along the way – in your words When we say above that Dr. Mathavious has an "actions speak louder than words" character, that should not imply (for the briefest of moments) that he is a quiet man. Just a measured one. He has spoken and written extensively throughout his whole career, his natural gravitas combining perfectly with his tall frame and National Football League shoulder width. You could spot him in any room or conference, including one full of NFL players (he would be the one without the need for shoulder pads). But his words always carry

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weight beyond his pure physical stature. The work of the FSC in any given year, has always been summarised by Dr. Mathavious in his yearly statement in the FSC's annual report. A combination of those statements, and those reports, really tells a fairly full story of the FSC's life since its inception, chapter by chapter, year by year. The sheer volume and growth of the FSC's platform, and overall portfolio, is both self-evident and quite staggering as each almanac recounts the previous year's events and achievements. There are simply far too many events, challenges and achievements from Dr. Mathavious' tenure to list here. The quality of the FSC's personnel, the Registry's early-mover leading technology, calmness during crisis (the man-made Global Financial Crisis of 2008 and the

When we say that Dr. Mathavious has an "actions speak louder than words" character, that should not imply that he is a quiet man. Just a measured one.

natural disaster of Hurricane Irma in 2017 included) and the international diplomacy and respect throughout review after review, all feature. But there are many, many more for another time. For now, we can reflect on a few key insights provided by Dr. Mathavious, using his own words. These might help us reflect on what good regulation looks like, the importance and urgency of staying at the forefront of the regulatory arena and, finally, as we move towards 2022 and beyond, the touchstone of remaining steadfast as new challenges arrive on the horizon.

"Fit For Purpose Regulation" Address at STEP Caribbean, May 2008 (four months before Lehman Brothers failed)

"Let me begin by putting fit-for-purpose regulation in context. We meet in challenging times…Times when regulators across the world find themselves being blamed for doing too little, or too much or indeed nothing at all to address the challenges of today. For a jurisdiction to win…depends on their winning a good international reputation, which in turn depends on their putting good and effective regulation in place. This does not mean that regulators should respond to every whim of the international community or dance to every tune of the regulated community. It does mean that they need to ensure a regulatory regime which responds effectively to legitimate demands while safeguarding the competiveness of their own financial services industries….A regulatory regime which fits the purpose both of the international community and of their own business sectors."

"The Urgency of Now" Address at the Meet the Regulator Forum, May 2014

"My attention was drawn recently to a seldom-quoted 1967 speech of the late Dr Martin Luther King Jr. I would like to quote from this. It is a long quotation but I hope you will bear with me because I think it has a lot of meaning for us here today. Dr King said: 'We are now faced with the fact that tomorrow is today. We are confronted with the fierce urgency of now. In this unfolding conundrum of life and history there is such a thing as being too late. Procrastination is the thief of time…we must move past indecision to action.' So today is about what Dr King called 'the urgency of now'. Because now, more than ever, we are required to move urgently and decisively – and also, I would add, creatively, pragmatically and thoughtfully – to keep the BVI financial services industry moving forward. The global financial crisis continues to spur financial

regulatory reforms on an unprecedented scale and pace. A new financial landscape is emerging and its contours are still forming."

"Saving the Dream For All” Address at the Meet the Regulator Forum, November 2015

"When I think about the issues that must be addressed urgently today…I find myself increasingly reminded of a poem called 'The Embattled Dream' by the AfricanAmerican poet Langston Hughes: 'There is a dream in the land With its back against the wall By muddled names and strange Sometimes the dream is called… This dream today embattled, With its back against the wallTo save the dream for one It must be saved for all.' The BVI's dream of being a resilient and vibrant toptier international financial services centre is one we all share. Yes today, it is embattled and at risk more than ever. Urgent action is needed not just to retool the model but to ensure that the BVI model evolves, adapts and adjusts to capture new opportunities so that the dream can continue. This action must be taken not just by a few of us but by us all. If we do not act together, we will suffer together. As Langston Hughes says, 'To save the dream for one, It must be saved for all.' I wish to reassure you that the ability to deal successfully with changing, sometimes adverse circumstances is part and parcel of the resilience and nimbleness which are the very DNA of international finance centres." Dr. Mathavious' words, written and spoken, have always carried great weight. He also has that rare ability to say a lot without speaking. His unspoken words, carry that same weight.

The light. And the house For forty years Dr. Mathavious has been the BVI's leading light, and standard-bearer, for all things financial services. In the last twenty years he has built, with others, the FSC "house". He has undertaken, in tandem, other key roles along the way, not least acting as the Deputy Governor and indeed the Acting Governor. Outside of financial services, being a father is doubtless his favourite role. He's also been a father figure to many more, as well as the financial services

industry itself. The Financial Services Institute has been a long standing passion and focus of his, with "saving the dream for all" probably at the heart of that passion.

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The FSC's logo, the lighthouse, is the visual depiction of the FSC. The annual report always explains it. "Just as a lighthouse provides terrestrial travellers of today with the same sense of hope and reassurance that it provided to mariners years ago, the Commission's logo bears testimony to the Commission's dedication to upholding standards befitting a premier international finance centre. It is symbolic of our commitment to preserving the safety and soundness of the BVI's financial services system so as to maintain the confidence of clients doing business from and within the BVI." The lighthouse is a very apt symbol of the FSC. In its first twenty years the FSC has certainly lived in interesting times and it is probably fair to say that it has seen many of the possible challenges and experiences which a regulatory body is likely to encounter. When its doors opened

For forty years Dr. Mathavious has been the BVI's leading light, and standard-bearer, for all things financial services. in 2002, the regulatory landscape was not static by any means, but its movements were relatively consistent and somewhat predictable. We now see fairly regular seismic shifts, often with no meaningful or at least logical patterns, and they are interspersed with constant tremors. That environment applies to all key financial services regulators around the world of course, from the G7 to the smaller international finance centres who also face other unique challenges. The rate of change in the regulatory arena is also breath-taking, with technological leaps adding more dimensions to that rate of change. The FSC has spent the last several years in this ever-changing space. Its next chapter will almost certainly see an even greater ratcheting up on the speed, complexity and depth dials. Exemplary navigation of the evolving landscape will be fundamental to success. An ability to distil good and effective regulation from the global seas of confused regulatory cloud and mist is likely to be at the forefront of that navigation. Strategic planning, nimble implementation, international cooperation and diplomacy are all key ingredients too. As Dr Mathavious passes on the BVI financial services baton, his footprints and blueprints have left the FSC and the industry in as good a position as is possible to carry it forward. We thank, universally, Dr. Robert A. Mathavious, OBE for being the light, the house and so much more.

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Salute to Dr. Robert Mathavious With gratitude for his extrodinary service to the territory, we at O’Neal Webster take this opportunity to salute Dr. Robert Mathavious, a true pioneer of the BVI Financial Services industry. A guide, mentor, and visionary, Dr. Mathavious stewarded the BVI Financial Services Commission through some of the most challenging and turbulent times. His contributions to the establishment and maintenance of a regulatory regime to keep pace with the ever evolving international standards and his service to the greater good of the territory is legendary. Godspeed, Dr. Mathavious, on your brilliantly earned and welldeserved retirement.

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THE MATHAVIOUS DOCTRINE FUTURE PROOFING THE BVI’S BRAND AS A LEADING INTERNATIONAL FINANCIAL CENTRE By Elise Donovan

or many in the offshore finance world, the BVI is held up as the model of a successful international business and finance centre. It has been endorsed and lauded for its combination of innovative products, firm yet practical regulation and the depth and quality of its people within the industry. BVI is not yet fully built as a ‘nation’, nor is likely to be so in short order. It has, however, achieved notable successes in Financial Services, which have catapulted its name globally; and is a critical part of the foundation on which BVIs’ growth and development have taken place over the past 30 years. It is no coincidence that the BVI’s path to growth has been in lockstep with the growth of the global economy and the rise of ‘globalization’. This can be traced back to the 1980s when the landmark first BVI Business Company structure was introduced. To date over a million BVI companies have been registered with a range of uses from institutional investment, joint ventures and stock market listings to trust and succession planning. Major respected organisations worldwide use BVI Business Companies to manage their cross-border activities. Over 140 major businesses listed on the London, New York or Hong Kong main stock exchanges use BVI vehicles to support their international investment activities. In 2017, BVI Business Companies held US$1.5 trillion of assets, equivalent to two per cent of global GDP. These substantial cross-border investments provide the underlying finance that enables real world economic investment in homes, factories, hospitals, railways, broadband, machinery, entrepreneurs – and more. The end result is that BVI mediated investment has been responsible for around 2.2 million jobs worldwide and made a contribution of over US$15 billion annually to global government coffers. The blueprint for this success comes down to the vision of Dr. Robert Mathavious who set out a doctrine that has shaped the BVI’s journey to become the leading global centre it is today.

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Good regulation is good for business First and foremost, Dr. Mathavious saw that in order to have a competitive advantage in the increasingly competitive global financial services space, the BVI had to build a reputation as a centre with the highest regulations and standards. On this, there could be no compromise. As Dr. Mathavious said: “There will be zero tolerance for the ethically challenged, for tax cheats, fraudsters and for any form of white-collar crime.” In setting the bar high, the BVI would attract a flight to quality and maintain a reputation with partner jurisdictions, regulators and authorities.

Engage, engage, engage – taking the BVI to the world First and foremost, Dr. Mathavious saw that in order to build and maintain a competitive advantage in the increasingly competitive global financial services space, the BVI had to get out and engage its audiences across its key markets. To achieve this, Dr. Mathavious set the BVI on a course of collaboration and engagement all around the world. The aim of establishing international standards and having jurisdictions work together in a cooperative manner is designed to ensure that those who insist on engaging in criminal activities are not given a breathing space in which to conduct their activities. Indeed, the BVI’s Handbook on International Cooperation outlines: “The nature of organized crime is such that it permeates national borders and assumes an international character. This makes it difficult for any country on its own to efficiently and effectively investigate and prosecute acts of criminality, without the aid of other countries in which or through which the act of criminal conduct extends. Thus the efficient and effective combating of organized crime calls for a collaborative effort and cooperation between countries and at an international level. Such cooperation must be robust and multi-faceted in order to significantly thwart criminals from designing and executing their intents.”

International collaboration Maintaining and often exceeding the latest international standards, is a key part of the Mathavious Doctrine. It is better to determine where the standards are going and to get there before they arrive. Rather than having standards imposed, the BVI would fare better by developing its own to protect its business and growing client base, whilst remaining compliant at a global level. The BVI has always been an early adopter. The jurisdiction was one of the first to introduce antimoney laundering legislation, and has implemented comprehensive AML laws and adopted stringent rules on know-your-customer due diligence, consistent with the recommendations of the Financial Action Task Force. The Mathavious doctrine is also clear, that for the BVI’s continued success, it needed to stay off the increasing number of blacklists, targeting jurisdictions that don’t meet certain standards. It is far better to make sure that the BVI is not included on a blacklist, rather than to have to fight to get off one. The BVI’s financial services industry long-term success is dependent on its international reputation.This means that the biggest is reputational risk. In turn, the BVI’s reputation is heavily reliant on our compliance with international regulatory standards. As Dr. Mathavious states: “When our customers’ due diligence modalities are inadequate, or the level of monitoring is low or nonexistent, we put at risk the reputation of the BVI as a centre for the conduct of legitimate business. And in so doing, we put at risk not just our own business but the businesses of friends and colleagues in the sector. It is not enough to agree that compliance is good business. It must be clearly understood that non-compliance by one threatens the livelihoods of all.”

A winning partnership Dr. Mathavious also saw that success and strength must come from within and this has created a mutually respecting and beneficial relationship between the public and private sectors. This cluster of corporate service providers, professional services firms – especially legal, insolvency and accountancy practices, banks and insurers have a close and symbiotic relationship with the BVI government and regulatory authorities. This led to what many of us call the BVI Advantage. Like many successful leaders, Dr. Mathavious embodied this blueprint and led from the front. He would be the voice of BVI at conferences and events all over the world. Dr. Mathavious made connections, built relationships and tapped into the latest thinking

in countries spanning from Asia to Europe. This engagement has been a key part of the BVI’s continual development of its own rules, processes and ways of doing business – making sure that the BVI remains in line with the highest standards globally. Being present at international regulatory conferences also meant that the BVI’s reputation could be further enhanced. Engaging with standard setters, other jurisdictions and regulatory bodies was a way of educating and promoting the BVI and has played a major part in protecting and projecting the BVI’s reputation as a responsible global financial centre.

Nation Builder

As Dr. Mathavious said: “This did not happen by accident. It has been largely achieved as a result of the determination of BVI public and private sector stakeholders, to ensure our industry’s continued success, prosperity and competitiveness. These stakeholders have undertaken meaningful, proactive and joined-up engagement with the champions of the initiatives and the international standard setters. They have worked hard and been canny and innovative. They have committed themselves both to complying with and – very importantly – to implementing relevant international regulatory standards, and to maintaining a pragmatic, proportional and prudent “right-touch” regulatory regime, based on consistent collaboration between the public and private sectors.”

Future proofing At the heart of the Mathavious Doctrine has been the vision and mission to protect the long-term future of the BVI as an international finance centre. A key part of this has been attracting and developing the best expertise – both through training and hiring talent. For example, almost all of the senior management in the FSC have LLM qualifications. The experience and expertise garnered in the last 35 years is also channeled back into the next generation of regulators. A final word from Dr. Mathavious epitomizes this ethos:

“The future will always be prosperous. The future may not be what it is today, but it will be prosperous. Young people must prepare to have the requisite skills that the industry will want and then leverage those skills. But equally, Government needs to put pressure on the industry to be more BVI-friendly in terms of employment opportunities and promotional opportunities.”

Thanks to the Mathavious Doctrine, the future looks promising for the BVI.

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EMPOWERING ENLIGHTENMENT: REFLECTIONS ON THE BVI’S "BUDDHA"

Inspiration

By Neil Smith

lay firmly on the ability of the Managing Director of the FSC and the Financial Secretary, to operate as part of a team. In practice, we had to be more than the sum of our individual parts. This contribution discusses the man as I knew him in this capacity, using stories to highlight themes synonymous with this home grown titan.

Reputation

r. Mathavious is most widely known as the guru behind the financial services sector in the Virgin Islands. Although not responsible for the sector’s birthing, his leadership and visIon over the years have resulted in government policies and a regulatory framework that have placed the territory at the tip of the spear of corporate business services around the world. Yet, one of his lesser known, but no less significant contributions to the success of the Virgin Islands economy, lies in his service as Financial Secretary from 1985 through 1993. I was not fortunate enough to serve with him in that capacity, but there was a period in time in the history of the VI, the years spanning between 2006 and 2016, that the nature of the relationship between the Government of the Virgin Islands and the Financial Services Commission (FSC) and our ability to support each other in the face of turmoil, and the requirements of a progressively difficult financial services environment,

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His efforts can be credibly identified as the reason why generations of politicians, even had the opportunity to preside over something of which they could be proud; such as the Financial Services sector being regarded as a “gold standard” the world over, and an economy that was comparatively speaking quite buoyant, and successful because of it.

This period was a difficult one, mainly for the reason that contrary to what was the case in the immediate past, there had emerged an even more deliberate separation between the regulatory responsibilities of the FSC and the policy making mandate of Central Government. The public officers responsible for ensuring these mandates, often had completely different orientations and approaches to the same problem. The challenges that this created were oftentimes inconvenient at best, and it was not until good relationships were developed, that powerful alliances could be formed, which serve the Virgin Islands well up to this day. The successful formation of these alliances was due in no small part to the mutual respect for Dr. Mathavious that all parties had then and still continue to have now. During this period, it was also quite amusing the extent to which many elected officials; even in bouts of pontification at the expense of public officers with gravitas not as deep as Dr. Mathavious, would retreat from these episodes of eloquent verbiage once he became involved. Some would often marvel at this, knowing that the reason why this occurred, was due to deep respect that was had for the many years of invaluable service Dr. Mathavious has provided to the Territory.

I first became acquainted with Dr. Mathavious as a student in the then BVI High School, through a discussion between himself and my mother about their requisite skills and tastes in regard to the various manifestations of flour and water. Subsequent to this, I was vaguely aware of his interest in me (and many others like me) as I progressed through university and eventually, as we both agreed was the case, I descended from technical into managerial roles in the Virgin Islands Public Service. He was one of two trained economists in the Territory with whom I was able to converse regularly on various matters that confronted me in my roles. I must say though, that I have yet to come to terms with the many different hands that he had, which clearly exceed the number of hands of regular human beings. In these interactions, his deep commitment to the advancement and maturity of the people of the Virgin Islands and his growing disappointment that in various circles we had abdicated our responsibilities to be our brother’s keeper, were more and more evident.

Insight Interactions with him on matters at hand generally resulted in wider discussions that linked the implications of what was being done to the well-being of the current society at large and for current and future generations of Virgin Islanders. It was this continual reflection on the future of the Virgin Islands and the implications of today’s actions for the coming days that precipitated a deep interest in many that he mentored. Dr. Mathavious has a profound understanding and appreciation for the more complex interrelationships between the socioeconomic realities of the Virgin Islands, the role the Territory plays in

the wider global landscape, how that landscape affects it, and what the Virgin Islands needs to do to thrive in it. It always seemed as if there was an endless supply of considerations to be made, but this was often met with him commenting with some literary nugget that would be a combination of humor and intellectual reflection: perfectly addressing the issue at hand with eloquence and style. Because of his involvement or proximity to many of the decisions and actions that have shaped the Virgin Islands as they exists today, many young Virgin Islanders have been able to understand some of the deep analysis and in other cases, the sheer luck that provided many in the Virgin Islands with opportunities that either built them and the Virgin Islands, or resulted in disappointing opportunity costs. Leaders and senior civil servants who I only knew from social studies classes in my primary and secondary education days were often humanized in conversations with him, and their character traits, as he expressed them, provided for a unique understanding of these people. Conversations with Dr. Mathavious provided context, filling in the details within the outline, and explaining the often hair trigger reasons behind many of the things that obtain in our society today. Even the curse of loneliness that so many at the tip of the spear of policy making and international representation of the Virgin Islands faced, was often made a bit more bearable with the wise counsel that Dr. Mathavious offered, sometimes in offhanded conversations. He himself had served in such roles for decades, and he was steadily passing on the mantle to more energetic upstarts, while simultaneously ensuring that they understood their roles and obligations to the people of the Virgin Islands. Dr. Mathavious served as a vital link between the Virgin Islands’ past and present: a younger contemporary to the generations that guided our future in the past, but yet accessible enough to the generations of today to be a critically needed guiding light to many who would have been lost in the rat race of capitalism, self-aggrandizement and newly found obscene greed that unfortunately far too easily characterize much of today’s society.

Motivation Interactions with Dr. Mathavious provided a needed respite from the cutthroat, materialistic society that make individuals with a bit more socialist leaning ideals so uncomfortable and disillusioned with society: A society that today appears to have migrated to care more about media time and spinning mistruths into truths to support selfpromoting agendas. Dr. Mathavious has always maintained a higher ideal. His focus and motivation have forever been on the real troubling aspect of the well-being of the helpless or hopeless in society, and how to advance our community to develop our people away from a relapse into slavishness that we summarily rejected only half a century ago. A link to the past, but also a bridge to the future; By being a source of mature and reasoned conversation, even in cases where there was disagreement, Dr. Mathavious is one of those individuals with whom one could agree to disagree on a particular matter, or even compromise on a matter to serve the common good. An individual whose character traits reminded those lucky enough to have experienced them, of the gentle and more classically educated generations of yesteryear; An individual who quotes Shakespeare and inspires, while simultaneously chiding you for some infraction. “Diplomacy is the art of telling someone to go to hell, while having them look forward to the ride”. This was on several occasions his advice to the young, impetuous, self-styled revolutionary who had been a participant in a student uprising that shut down the university campus at Cave Hill two decades prior. This when a student with whom he was acquainted, was detained by a professor and surreptitiously browbeaten into admitting unethical conduct. This individual who often pulled on his coattails when frustrated with the unwieldy and seemingly illogical beast of policy making in the VI Public sector, was bombarded with such terms as “ethically challenged” and having a “velvet tongue,” or affronted with such terms as “ lawyers like engineers are on tap and not on top”, all in attempt to school him in the finer art of public service. These lessons were significant, since at the time for

me, such terms as “the whole is more than a sum of its parts” initially made no sense. One can imagine therefore the various combinations of conversations and guidance that took place through the myriad of arenas in which Dr. Mathavious fought.

Nation Builder

One of the most amusing episodes, involves him being effectively ambushed into accepting an honorary doctorate from the University of the West Indies. To this day if anyone who is close to him would like to have a spot of fun at his expense, one merely needs to refer to him, in his earshot, as Dr. Mathavious. On reflection, it is clear to me that Dr. Mathavious never ceased being an economist. Even though many around him have viewed him more as a regulator than as anything else, from my vantage point, his regulatory responsibilities and interests were always merely a consequence of a deeper and wider commitment to the Virgin Islands and to the advancement of its people. Based on the sharp comments he would sometimes make in my presence, he clearly has an intense aversion of and passion to fight for the plight of the disenfranchised and disadvantaged in Virgin Islands society. From his vantage point of relative privilege, and with a likeness of Buddha, to whom he was often compared in his Asian travels, his philosophies and quiet crusade for the advancement of thought and civic responsibility of humanity in the Virgin Islands were relentless. This selfless community focused approach, and recounts of his belly being rubbed in jest, by strangers while being referred to as Buddha in the far East, continue to this day to be a source of both amusement and hope, for me: Hope in the capacity of people to care about, and to actively pursue the improvement of each other’s welfare. The Virgin Islands is a better place for having had Dr. Mathavious (and those he has mentored) in the inner courts of its policy development and implementation over the years. His example, though not without fault lines as is the case of all great men and women - is one which bodes well for others to follow, if indeed it is the case that we seek a better, fairer and more equitable Virgin Islands: A Virgin Islands of which we all can be proud.

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INTEGRITY THAT CREATED LEVERAGE COUPLED WITH TAOIST LEADERSHIP By Peter Tarn

suspect I am one of only a relatively small number of corporate lawyers practicing in the jurisdiction before the advent of the BVI FSC and to begin to measure Robert’s contribution to the BVI Financial Services Industry, it is necessary to try to remember what that landscape looked like in the late 90’s. Essentially, the concept of a regulator having an element of control over the entirety of the industry here was unthinkable. Industry would have said (after checking what people meant when they used the term investment or mutual fund) that yes, they could see the argument that these funds were financial services products and yes there was an argument for regulation as the price for international acceptance, but why on earth would anything else apart from a bank fall within a financial regulator’s reach? The U.K. House of Lords statement, of the principle that countries had no business in enforcing the tax claims of other sovereign states was less than 50 years old, people believed that

“In the end, conflict is the crucible where good, but advanced practice emerges and Robert always navigated those conflicts with charm, with at least half an eye on the horizon and with immense political skill.” anti money laundering was merely an adjunct to the war on drugs and nobody anywhere in the world really knew what compliance was for; 911 hadn’t happened, the EU was focussed on the internal markets not exercising global soft power, Russia was seen as being on a journey to integration into Western Europe, Hong Kong still represented a huge proportion of China’s GDP, and the GFC of 2008, let alone the data leaks that would impact the BVI were way in the future. Other than the 1998 OECD publication of its report on Harmful Tax Practices (at the time seen as potentially the death knell of IFCs which all seems rather quaint from 2021) there were almost none of the pieces of architecture such as FATCA and CRS that would shape the following decades. Some of that had changed - including obviously 911 - when the FSC formally came into existence in 2002, but that was the backdrop to its birth. The Industry and in particular some of its then barons, didn’t especially welcome the emergence of a regulator who was determined to make the weather.

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Lawyers believed that the dictates or discretions of a regulator were not something to be taken seriously, unless a judge said they should, while some others were quite prepared to try to use the political clout, that they believed the revenue streams they controlled would give them to stymie Robert’s efforts. Against that backdrop, Robert forged the FSC that we know today and while it might be true to say that Industry relations with the FSC have not always been entirely harmonious, what has changed beyond all recognition, is the acceptance that it is central to the continued success of the BVI Industry. There is also an acceptance that some degree of conflict is inevitable when a regulator is doing its job properly. In the end, conflict is the crucible where good, but advanced practice emerges and Robert always navigated those conflicts with charm, with at least half an eye on the horizon and with immense political skill. Whilst the existence of a powerful and respected regulator in an IFC may from 2021 seem inevitable, there is an element of confirmation bias to that conclusion and without his personality and talents, it is not difficult to construct a counterfactual, where the BVI lacked such a figure, did not take the steps it needed to and where our Financial Services Industry gently ceased to exist in about 2005. Robert’s presence at the FSC delivered at least three rare things which enabled it to become so central. Firstly, an assumption of integrity and the important word here is assumption – to have integrity is one thing only, if it is assumed by all players, does it create leverage. Second an ability to provide Taoist leadership that ability to get people, whether within the industry, domestic or foreign governments, or international bodies to do what he needed of them, all the while mostly believing it was all their own idea. Finally the courage to demand large changes in the teeth of bitterly entrenched opposition when required - and the wisdom not to do it too often. However, leadership of the FSC is not the real story. The real story is that Robert Mathavious, during his time at the FSC, under cover of competent and often imaginative development of a regulator and its role in the financial services industry, Robert was doing something rather different. He was in fact engaged in nation building and in creating capacity that went way beyond the FSC. He was nurturing both an ethos and a cadre of individuals, trained and inspired by him, which could provide high quality public and private service to the BVI. At many times, Robert’s insistence on not using more than a smattering of imported expertise was a source of frustration and friction - my very real admiration for his achievements co-exists with continuing to believe, that within the relatively narrow sphere of its technical role, the FSC could have moved faster and more efficiently at many times during his leadership. However, two decades down the road, that feels an almost irrelevant point and it seems relatively apparent that, whether at the outset or whether over time that real, deep, long term capacity building for the entirety of the Territory was actually the day job – the FSC was just the place he chose to do it.

A Talent Pipeline

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MY FIRST (ACCIDENTAL) MENTOR By Ayana Glasgow

e mindful of the tail wagging the dog – this was one of several niblets of wisdom that Dr. Robert Anderson Mathavious OBE, affectionately called Mr. Mac, was known to share with the Commission’s young group of regulators. It was a phrase that I grew to understand well and long after I first heard it. To me, this meant to be wary of allowing inconsequential things to dictate and control one’s actions and in my observations of Mr. Mac over the years, I saw a man who lived by the words he spoke. Over the next 20 years he would add layer and layer to the platform of trust, confidence and integrity that he had already built. Along the way, Mr. Mathavious would become Dr. Mathavious, and Dr. Mathavious would become Dr. Mathavious, OBE. We will take a brief trip back in time over those two decades where Dr. Mathavious and the FSC were inextricably linked and indelibly synonymous with one another. We will also borrow some of Dr. Mathavious' own words to add some perspective. In 1998, I was employed as a financial analyst with a private mortgage bank in Bethesda, Maryland, USA in what I described at the time, as my dream job, when I received the telephone call that would change my career trajectory. Mr. Mac was on the other end of that call, and after all the exchanged pleasantries, he simply said that it was time for me to return to the BVI. After I completed my undergraduate degree in 1996, Mr. Mac was one of few persons to support my request to the BVI Government to remain in the USA following graduation, to gain work experience. Even then, I knew that Mr. Mac understood and appreciated the need to expose young BVIslanders to the world, knowing that it would reap benefits for the BVI in the long term. So naturally, when he called to summon me, the only thing I could do was proceed as instructed and return home. Yes, he had that kind of skill! What greeted me on my return, to my pleasant surprise, was that I was surrounded by other young professionals, who were also looking to make their mark and just as eager as I, to join the BVI Financial Services Commission (the “FSC”)1 under the leadership of Mr. Mac [who I silently believed to be a giant among men at that time.] Mr. Mac took great care in recruiting and surrounding himself with a young core, who were poised to become the next generation of key financial services industry players. In hindsight, like the accidental tourist, I have come to appreciate the impact Mr. Mac had on my career and how he was, although accidental, my first mentor. In those early days of the FSC, Mr. Mac set the tone for excellence in undertaking the mammoth task of regulating the BVI’s financial services industry. To this end, training was paramount. Attending the Oxford Offshore Symposium at Jesus College, Oxford

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University, Oxford, UK2 was considered not only a rite of passage for each new regulator, but ultimately for most new employees at the FSC. This was only the start of training obligations for an FSC regulator. Our exposure to the courses offered by the UK Financial Services Authority3, the Federal Reserve, the Basel Committee on Banking Supervision, the Bank for International Settlements, the International Association of Insurance Supervisors, the International Organization of Securities Commissions, Caribbean Financial Action Task Force and other international agencies rounded out those training exercises. Critical to these learning experiences were the abilities to converse with regulatory counterparts around the world, appreciate their perception of offshore--especially the BVI, and learn about typologies affecting our industry. But attendance at these courses and conferences were not to be taken lightly by any attendee. It was mandatory to prepare a report on the course/conference and to identify recommendations towards improving the FSC’s approach to regulation/supervision. I can admit, without reservation, that these training opportunities provided an irreplaceable foundation to not only my regulatory career but my perspective of the financial services industry, locally, regionally, and internationally. As my days at the FSC progressed, I came to realize that Mr. Mac was well-known and respected by his international and regional counterparts. One of my FSC colleagues once shared a story about a meeting between the OTs4 and one of the international standard setting bodies at a foreign location. Mr. Mac’s flight was delayed and thus he had not arrived by the time the meeting was ready to begin. Once the session started, the question was asked about his whereabouts and, truth be told, the “meat” of the discussion did not commence until Mr. Mac arrived. This was testament to not only Mr. Mac’s credibility, but to the respect and counsel that these colleagues knew he would render at such a vital gathering. Throughout my tenure at the FSC and under Mr. Mac’s guidance, I not only developed the confidence and capability to navigate through financial services legislation, but more importantly, my love for compliance was born, nurtured, and flourished. So strong was that love, that I earned membership of two compliance professional bodies in the same year - the International Compliance Association - where I am now a Fellow - and the Association of Certified AntiMoney Laundering Specialists.

Mr. Mac encouraged honing our craft, in other words, understanding the “ins and outs” of the legislation that we, as regulators, were responsible for administering. He consistently tested this knowledge by “pushing” us to represent the Commission on local, regional, and international panels discussing BVI’s regulatory framework. My most memorable of such conferences, required me to present to a room full of foreign speaking delegates in Lausanne, Switzerland. Faced with reducing my presentation – the night before - to half its length to accommodate for a translator, I was proud that my knowledge was so well grounded that I was able to maintain the heart of the presentation without compromising its purpose. Mr. Mac knew many people, so even though he was not present in-person, he would be able to get a full review by asking one of his acquaintances how his proteges performed. So, we all understood that whenever we participated in such events, we were not representing ourselves, we were representing Mr. Mac and the BVI. And we were also fully aware that we were expected to always do so at a high standard. To augment what I considered as the “on the job” training that my fellow young regulators and I received, Mr. Mac encouraged reading. He would return from his many overseas engagements on behalf of the BVI, with several books from an array of authors to add to the FSC’s library collection. Mr. Mac introduced me to my favourite author – David Baldacci, but most importantly gifted me with a copy of the book “Who Moved My Cheese?”. While this book makes for simple reading, its themes are profound and have had great impact on my career. Another indelible mark left on my life by Mr. Mac, although personal, has been the love of travel combined with the love of country. Like him, I have become well-travelled, eagerly engaging in new experiences that exposed me to varied peoples and cultures that I have shared with my children. Relatedly, Mr. Mac has epitomized from my vantage point, the qualities of a true BVI patriot. In observing him, I have recognized the importance of putting country above self when needed. He has done so on numerous occasions, and not many can attest to being able to accomplish that feat.

In mid-2007, I made the difficult decision to transition from the FSC to the private sector as a compliance officer. The training received during my tenure at the Commission proved helpful in this new position. The drive to not only perfect and understand the regulator’s responsibilities, but also the knowledge of the regulator’s expectations of a regulated entity, were of tremendous help to guide my approach towards this new role. That first private sector opportunity benefitted from the work ethic I learned while in the FSC’s employ, so much so that when offered the chance to become part of the client facing team, I readily accepted. This catalysed my drive to become a member of the Society of Trust and Estate Practitioners (“STEP”) – accomplished in 2011 - and demonstrated that I could also excel at client engagement. I am extremely proud of my development from regulator to compliance officer to private wealth practitioner to now Executive Director of an established trust company. I fully recognise that such accomplishments would not have been achieved without the foundation established during my tenure at the FSC and under Mr. Mac’s accidental mentorship. Such highs, of course, can sometimes have an occasional low. As a female in a male-dominated industry, there was a particular occasion where I felt less than sure about my fit within the private sector. On that occasion, a few years ago, I shared my thoughts with Mr. Mac and broached the idea of returning to the FSC. He said to me “we need persons like you in the industry” and encouraged me to remain in the private sector. This was one of many conversations with Mr. Mac in my post-FSC days, that proved vital and humbling to me over the years. The FSC’s “Meet the Regulator” (“MTR”) forum was always well attended by the industry, but in my opinion, what drove that attendance was the

opportunity to hear Mr Mac deliver one of his riveting, timely, and memorable keynote addresses. Navigating through the ongoing onslaught of international initiatives and various leaks , one of Mr. Mac’s most memorable MTR speeches, delivered in January 2009, titled “Challenges and Developments in the Regulatory Environment”, following the election of President Barack Obama and the 2008 financial crisis, still seems relevant today. In that speech, Mr. Mac referred to the growing importance of the European Union as a “significant global standards setter in financial services regulation and practice”; underscored the need for “right touch regulation”; and emphasized the need to continue to “develop joint thinking and action between the industry, regulator

A Talent Pipeline

“If we have the courage to dare, we will succeed.”

and the government” to continue to defend against these challenges. Indeed, defending and advocating on behalf of the BVI, fostering the credibility, legitimacy, and respect to the BVI’s financial services sector – both regionally and internationally - exemplify the patriotism that is reflected throughout Mr. Mac’s life. From my perspective, and that of many others—I am certain, the trajectory and indeed the success of this BVI financial services industry is directly tied to the hard work, diligence, and sacrifice made by Mr. Mac during his career. To this end, we should extend gratitude to him and endeavour to carry on his legacy. As he has now passed the ceremonial torch on, let us not allow the tail to wag the dog, but instead lead, as Mr. Mac would expect us to. In his words “if we have the courage to dare, we will succeed.”

I joined the then Financial Services Department in 1999, replaced by the BVI Financial Services Commission and established as a statutory body in 2001. 2

The Oxford Offshore Symposium is now defunct.

The UK Financial Services Authority is now dissolved and has been replaced by the Financial Conduct Authority and Prudential Regulation Authority of the Bank of England. 4

Refers to the British Overseas Territories.

The European Union Anti Money Laundering Directives, common reporting standards, economic substance, beneficial ownership registers, introduction of a minimum global corporate tax and data leaks [Panama, Paradise, and Pandora] to cite a few.

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FAREWELL

D R . R O B E R T M AT H A V I O U S “A genuine leader is not a searcher for consensus, but a moderator of consensus” – Martin Luther King, Jr. “Leadership is not wielding authority, it is empowering people”

– Becky Brodin

I saw both of these qualities in Dr. Robert Mathavious during his tenure at the BVI Financial Services Commission. As I worked more extensively with his team members, it was clear to me that Robert had empowered each of them in the departments of the FSC and that he was a moderator of consensus. There was and is a delicate balance to maintain between the regulatory authority and the private sector, which is essential to the survival of both. Those of us in the private sector were always concerned about being over regulated out of business. However, we were acutely aware of the necessity for regulation, as was Robert, for he knew that if we were not properly regulated, we could similarly see our way out of financial services business. For this, we thank Dr. Mathavious, as he guarded and guided the BVI from his heart and mind. He did his very best to maintain the perfect balance at the helm to tide us through the years, some turbulent, of a world throwing regulatory requirements at small offshore centres at every turn, leaving many of us wanting to see a more level playing field (or rather, a more level survival field) for all jurisdictions. I am proud to say that, among his other notable achievements, he was instrumental in the BVI joining the International Organization of Securities Commissions (“IOSCO”) in 2007. IOSCO, the international body which connects the worlds security regulators, is recognized as the global standard setter for the securities sector, and it develops, implements and promotes adherence to internationally recognized standards for securities regulation. Membership reflected that the BVI had complied with all the standards required of IOSCO concerning cooperation and the exchange of information. It also reflected the BVI’s and the FSC’s commitment to cooperate and comply with international regulatory standards. Robert was quoted as saying, “This is a significant achievement for the BVI. We are very pleased at IOSCO’s recognition of the countless efforts we have made in recent years to foster international cooperation, in full compliance with all international standards affecting our industry. Being a member of IOSCO is a very important accomplishment that confirms the BVI as one of the premier and most effectively regulated offshore jurisdictions in the world. It is the culmination of a long process in which we have made extensive progress and improvements to our regulatory regime under the principles outlined in the IOSCO MMOU; long established principles of fundamental importance to the government of the BVI and the FSC." You were a true pioneer and leader of the BVI Financial Services Commission. You set a high standard for your team, for the practitioners in the industry, and for the BVI as a reputable, resilient and formidable offshore financial services jurisdiction. For these things and more, we are truly indebted to you. It was also our pleasure working with you and your team over the years. We sincerely wish you all the very best from the Partners and Staff of SINCLAIRS (BVI).

Adenike M. Sicard Managing Partner, SINCLAIRS (BVI)

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BUILDING A NATION BY BUILDING PEOPLE ENHANCING CAPACITIES, CULTIVATING COMPETENCIES By Brodrick Penn

He set about to, and delivered, just that. This is how: Financial stability Mathavious was all too familiar with the fact that organizations are often stymied by lack of financial resources. This is an acute problem for regulatory institutions, which by their nature are not revenue generating. It is also especially true for new organizations that are competing for scarce resources from Government. Resources which if applied to other areas such as health, education, infrastructure or other social needs, would produce more visible benefits and political gratitude. Knowing full well, that the Commission was competing among other sectors (with greater political empathy for financing) for funding which could impact its financial stability, Mathavious derived a financing strategy that would not only deliver financial stability for the Commission; but also for the Government. The strategy was simple, yet brilliant. Negotiate and enshrine in the Commission’s legislation, the Commission’s ability to receive and collect all monies paid under any financial services legislation. This would include monies paid to the Companies Registry for company incorporations and other fees.

obert A. Mathavious is a ‘Nation Builder’!

Yes, it is the loftiest of compliments, reserved normally for very distinguished politicians and statesmen whose vision, when transformed into reality, positively impacted the development of a nation. And yet, by the power vested in me, through the penning of this article, I unreservedly bestow this appellation upon Robert Anderson Mathavious. Anyway, let's start by going back to 2001. BVI is not yet fully built as a ‘nation’, nor is likely to be so in short order. It has however achieved notable successes in Financial Services, which have catapulted its name globally; and is a critical part of the foundation on which BVIs’ growth and development have taken place over the past 30 years. The factors which have made BVI Financial Services successful are many, varied, and debatable. However, one key factor is its financial services regulator – The BVI Financial Services Commission. The Commission is not perfect -- far from it, but it is a microcosm of a fair example of what nation building looks like in the form of an organization. The Commission’s successes are predicated on several factors, chief among others are its Financial Stability, Strong Governance, and Skilled Professionals. Mathavious’ strategic genius, envisioned an organization that would be financially and politically independent, and completed with strong and sufficient human capacity that would deliver on its objectives.

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Create (within the statute) a pass through mechanism, which would allow the funds collected on the Government’s behalf to be placed in a trust account jointly controlled by the Commission and the Government; and devise arrangements for regular transfers to Government and the Commission. And the pinnacle of this maestro strategy -- ensure that the law mandated the percentage to be transferred to the Commission, a range which is negotiated on an annual basis, but is at a minimum 7.5% and at a maximum 15%. This arrangement not only ensures ongoing and regular financing for the Commission’s operations at appropriate levels, but also protects its independence; and as well delivers timely, fully accounted and substantial revenues for Government. Strong governance Mathavious ensured that strong and good governance mechanisms were enshrined in the Commission from early on. At the cornerstone of financial services regulation is the principle of independence – the ability to function independent of external influences (especially political) which may bring undue influences that would conflict with the principles of regulation and the objectives of the Commission. As such, Mathavious ensured that the Commission was structured not only to be independent financially, but

more so, that its governing mechanisms were fit for purpose to deliver strong governance. For example, the Commission was set up as a body corporate, giving it legal personality. Its Board members were required to have financial services backgrounds, and two of them were required to be from outside the Territory; thereby leveraging international experiences and expertise in its decision making.

I call it “Talent Understudy”. Mathavious would source and hire the best global talent BVI money could afford, and lured them to exercise their professionalism, to develop a sound regulatory environment; in the most breathtaking natural environment. In every case, he paired each of these foreign professionals with young, ambitious, bright BVIslanders and demanded of them to teach us everything they knew.

The Commission was also structured to have very clearly defined functions and administrative mechanisms for the Board operations; as well as functional committees for decision making, both at the Board level and at the operational level. This ensured that consensus decision making, through diverse views, permeated the Commission’s decision making processes.

I recall the day Mathavious unconventionally handed me a set of resumes and said “help me choose your boss”. Yes, Mathavious empowered me from my earliest days at the Commission to have a say in who I wanted to learn from – on two occasions. After 4 years of school-like review of my work by one Registrar of Mutual Funds, and 3 years of understudy of a Director of Investment Business with strong managerial and communication skills; I took the best of their worlds and became a proficient and knowledgeable Director of Investment Business.

At the operational level, a structured hierarchy placed senior officers with participatory and voting status on its operational committees, which cultivated a culture of inclusion.

Within the Commission my story is magnified tenfold – experienced foreign talent, utilized to develop young local talent, has been a winning formula. The Commission’s senior management is now almost entirely BVIslanders.

Yes, midstream the Commission’s evolution, there were reasons and opportunities for corrections, for example to ensure proper succession. But in finality, the Commission stands out as an example of good and strong governance. Developing people: enhancing capacities and cultivating competencies Nation building is often most appreciated (perhaps falsely so) through physical manifestations of development -- schools, hospitals, roads, ports and airports, businesses and buildings. It even manifests more intangibly, (but yet appreciatively) through good laws, policies and exemplary governing institutions. However you cannot build any nation without building its people. I cannot tell you when Mathavious’ love for building people was birthed, I am sure this long predates me. I can say that some 25 years ago, two Christmases and one Summer before I took up permanent employment with the Commission, I was welcomed to his people building factory, simply on a plea from someone close to me, who made representations for my summer employment. Over the past 25 years, I have had first-hand impressions of what is Mathavious’ greatest legacy, his love for people and his self-appointed responsibility to build everyone he encounters to become a better version of who they were. This has been manifested before me through several distinct ways. Talent understudy Mathavious adopted a people development philosophy that predated me and the Commission as we know it.

A Talent Pipeline

Over the past 25 years, I have had first-hand impressions of what is Mathavious’ greatest legacy, his love for people and his selfappointed responsibility to build everyone he encounters to become a better version of who they were. Education & training Largely, Commission staffers enter its workforce with some level of tertiary education. Notwithstanding, the Commission through Mathavious’ advocacy has adopted very liberal practices and formal policies that provide avenues for ambitious and committed staffers to pursue additional studies and obtain higher level degrees. Apart from academic degrees, Mathavious’ leadership caused the Commission to be very generous with sponsoring its employees to pursue and achieve certifications in relevant disciplines. As well, the Commission as a matter of practice, allows and fully supports and encourages secondment to foreign or international organizations to help develop its staffers’ technical competence and global experience. These formal education and training commitments are complemented by countless other opportunities, and programmes for staffers to receive training and development; through various conferences, seminars and webinars. Mathavious has widely adopted education and training as the cornerstone of his people building philosophy. Mathavious’ penchant for developing local capacity within the financial services industry was not only internal to the Commission. Actually, in his selflessness, he has educated, trained, recommended

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and released many competent young Virgin Islanders to the private sector. You see, he believes that you should not only build people for the benefit of your organisation, but that you do so for the betterment of the Territory. Professional mentorship Mentorship requires someone to take a personal interest in your development and present themselves as a trusting, caring individual with experiences and knowledge that they are willing to impart, on you to aid in your personal or professional development. If Mathavious has been an inspirational mentor to a 1000 people -- that is perhaps, still multiples short of who he would have mentored in some form or fashion. Mathavious takes a personal interest in every human being he meets and unwittingly takes on the task of mentoring them, sometimes to his own chagrin. There is nothing more inspiring however, than having a mentor who truly believes in your potential and avails himself to help you achieve it. This is Mathavious! Spiritual mentorship The BVI is a community steeped in religious traditions. We are church going, prayerful folks who revere God. Those traditions (rightly or wrongly) have also transcended the work place. Mathavious as a God fearing man, though careful not to impose his Christian views on his staff and the Commission, is never shy to ask “when last you went church”, “do you still pray”, “young man you still believe in God right”? He often, by his own actions or reflections of his life of service to the Church and God, encourages you to walk a godly path and not to lose connections with your spirituality. He never pushes, he always nudges; but yet he delivers ‘low key’ spiritual mentorship that keeps you balanced in your world of professional and personal ambition. Friendship Friendship is rarely professional world, friendships. Perhaps consider ‘friendship’

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attainable in the much less true it is naïve to even as an important

attribute in building people – but it is! In an age were connections are fleeting, love and human compassion are scarce or non-existent; one cannot underestimate the impact that a caring, compassionate, advisor and confidant has on the confidence and purpose of a man – both as a professional and a human being. Mathavious is the type of Boss that greeted you in the parking lot when you were late or leaving early, not to chastise you, but to have a chat or a smile or a joke, even if it began with his Baritone bellowing out “young man where you coming from so late” or “where you ‘4:30’ worker going”. It is his way to engage you and say I see you, is there an issue? Or I expect better and more. Then there is his infamous walk arounds, maybe to secretly catch you in the act of not working. We would often joke that he is patrolling his ‘Fiefdom’ (as one Chief Minister once called it), but to most of us it felt like Mathavious the Boss/Friend is simply engaging in the way he innately knew, “he jus checkin on us.” Truth be told, bosses should really not be your friend. But when you can walk into Mathavious’ palatial book junk yard (which dubbed as his office) with a personal, family or professional issue; and you come away with some good advice, solution, or just a listening ear and some new things to think about– it’s hard to be convinced that your Boss is not your friend. Everything to everyone People always say ‘you cannot be everything to everyone’. Mathavious has come the closest (that I have seen) to proving that adage wrong. From mentorship to friendship, from cheerleader to advisor, from advocate to detractor, teacher, boss, friend – he has impacted many of us in ways that have shaped our development as professionals and individuals immensely. He is even a closet politician/political advisor. Mathavious doesn’t like politics, or so he claims. Too many of his friends have become politicians, he would say. We often joked that he is a political advisor, he doesn’t agree, but if he did, he would say that he is a non -partisan political advisor – a confidant to all.

The success of the Commission depended on that posture – duty above all else. When an individual can transcend the divisive politics of the BVI, and provide nonpartisan advice to virtually every Chief Minister or Premier, in the interest of the continued success of our Financial Services sector, this is another feather in his cap towards nation building. These experiences are mine, but can no doubt be repeated at least 100 fold with only slightly different permutations. His legacy At Mathavious’ retirement meeting, I quipped that he is yet to fire someone in his almost 50 years of being a leader. I surmised that it is because he understands that in each of us, there is more. We just need to tap it. Mr. Mac’s leadership has moulded and defined a generation of leaders, within and without the Commission. We now each have a responsibility to pay-it-forward and mentor, develop, empower and support our own generation of new leaders. His visionary leadership, strategic thinking, and legacy are yet to be fully chronicled. His disdain for the limelight and unparalleled humility might well ensure that it never is. But he should have thought of that when he committed to building up people like me – independent thinking and so fully prepared to suffer his nod of disappointment from penning this piece, which would be at odds with his wishes and his humility. I remember when not so long ago Mathavious addressed us as the outgoing Managing Director of the Commission. He told us “I’ve discovered the beauty of simple things again, I am comfortable, and settled in what I have to be doing.” Mathavious’ humility is omnipresent even after nearly 5 decades of helping to build a nation. He has helped to enhance the capacities and cultivate the competencies of MANY -- even the most ‘Stinking Dirty Breadfruit Swappers’. To my mind, without any deliberate effort, he has already cemented his legacy as a “PEOPLE BUILDER – A NATION BUILDER”

journey in which I listened to Robert speak about each new initiative that was being planned.

THE MIDAS TOUCH By Dr. Kedrick Pickering

obert Anderson Mathavious, a ‘BVI Gem’ a rare jewel, a man of exceptional brilliance, who was and is deeply committed to the greater good. He is a public servant at heart, one whose love for his beloved BVI is incomparable and unquestionable.He is a man of tremendous faith, a devout Christian, an unapologetic Methodist and a person of impeccable integrity. He is a diehard sports fan, in some ways fanatical with an almost religious loyalty to his New York Yankees baseball team. A voracious reader of varied material, a news junkie and one who probably could not survive without twenty-four hour television. Robert Mathavious is a close personal friend of over 50 years, we first connected at the BVI High School in 1970, my junior year, his senior year. We were roommates at the Cave Hill Campus of the University of the West Indies in Barbados in the academic year 1976-77, his final year, my first. I spent twenty years as an elected member in the Legislative Council/House of Assembly in the BVI from 1999-2019, the time that saw the growth and development of the Financial Services Industry in the BVI. It is fair to say that I have had a front row seat to history and have watched from closeup the ‘HOUSE THAT MATHAVIOUS’ built. The Financial Services arguably had its inception in 1984, with the passage of the International Business Companies Act (The IBC).The industry as it is known today, probably had its formal genesis in 2004 with the passage of the Financial Services Commission Act. That is important to note, as the Financial Services Department was started in 1993 with Mathavious and a secretary, he was of course the Financial Secretary at the time and was fresh and energetic from completing post graduate studies at Georgetown University in Washington DC. I spent many an afternoon in that office(upstairs the Abbott Building) listening to him expound on his thoughts and ideas for the development of the Financial services department and beyond, most of it I had no clue of what he was sharing, I guess I was just a sounding board. Those discussions would flow over to the more intellectual space of the ‘University of Skelton Corner’ just down the road from his office. In March of 1999, along with six other new members (former Premier Dr. D. Orlando Smith and the present Premier Hon. Andrew A. Fahie among them), I was elected to the then Legislative Council of the Virgin Islands. For the next twenty years I was one of the elected officials who passed laws for the peace and good governance of the BVI. During this time, the major pieces of legislation that now form the backbone of the Financial Services Industry were passed. The Financial Services Commission (FSC), The International Finance Centre (IFC), The Financial Investigative Agency (FIA), The Financial Services Institute (FSI) were all successfully established. It was a

Each new accomplishment was a stepping stone to the next, always seemed to be already conceptualised. There was the need for a presence in London, an idea that his fellow senior public servants were equally engaged with, Bennett Smith and Lorna Smith in particular I can remember. The growing need for specific institutions to settle international disputes, namely the Commercial Court and the alternate dispute resolution institution, the BVI International Arbitration Centre were established. In between, there were various pieces of legislation and amendments to previously enacted laws.

A Talent Pipeline

“He clearly has the Midas touch in recognising and recruiting talent and the rarest of abilities in the personal respect he has and delivers to those whom he come in contact with.” None of these, whether all or in part, were necessarily Mathavious’s own individual initiations and certainly not his own accomplishments, but he was at the forefront of it all, in whole or in part. He clearly has the Midas touch in recognising and recruiting talent and the rarest of abilities in the personal respect he has and delivers to those whom he come in contact with. This was clear in the way in which the industry unfolded, the collaboration and cooperation between the public and private sectors and in all likelihood is the swan song of it all. Legislation was almost always passed in a bipartisan manner, a process that continues and when there was need for informal discussions with Members of the HOA, he and his team were given the due respect to lead the discussion on the policy development to promote the best possible outcomes for the BVI. One of the more difficult and thorny issues in the early years was convincing Members and doubtless, others in the industry, that the FSC was a Regulatory Body and as such, could not be involved in the marketing of the same. That I know from my privileged position was a consistent source of controversy locally, when Mathavious did not attend certain promotional conferences hosted by the BVI. As the industry grew, this distinction was pertinent to its success, but it wasn’t always understood and appreciated and so created constant challenges and growing pains. The stature of Mathavious loomed large and his physical presence meant much, but in the end the conflict created more avenues for others to blossom and shine, and ultimately sustained the growth of the industry. He would have had it no other way.

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ROBERT'S MILESTONES IN FINANCIAL SERVICES

BVI Business Companies Act Authorised Custodian Regime Financial Services Commission Act

2001

Insolvency Code of Practice

2003 Insolvency Act Virgin Islands Special Trust Act

2004

2005 Insolvency Rules

Virtual Integrated Registry and Regulatory General Information Network (VIRRGIN)

Financial Services (Exemptions) Regulations, 2007 (Private Trust Companies Regime)

2006

2007 Membership in GIFCS (Group of International Finance Centre Supervisors) formerly OGBS (Offshore Group of Bank Supervisors) Ordinary member of the International Organization of Securities Commissions (IOSCO) The BVI was the first ever country to be admitted to ordinary membership of IOSCO based on changes to its legislation and under the IOSCO Memorandum of Understanding

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Insurance Act (2008) Anti-money Laundering Regulations (2008) Anti-money Laundering and Terrorist Financing Code of Practice (2008)

2008 2009

Securities and Investment Business Act

2010

Insurance Regulations (2009) Regulatory Code (2009)

2011

BVI Financial Services Commission (HK) Ltd. (BVI Asia Representative Office)

2014

Financial Literacy Programme (Money Matters BVI)

2017

Financial Services (Exceptional Circumstances) Act (2020) Regulatory Sandbox (2020)

2020

Financial Services (Continuity of Business) Act

Financial Services (Recognised Custodian) Order (2009) Financing and Money Services Act (2009)

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A conversation with Richard Peters

n the sidelines of the recent Global Currents Conference on financial services held here in the BVI last November, a leading event on the calendar for the week of celebrations for Dr. Robert Mathavious, Business BVI took the opportunity to sit down with Richard Peters for his take on Robert’s consequential contribution to the sector. We also sought his overall thoughts on the future of the sector in the BVI and on key changes and opportunities in the space globally. In so many ways, Richard Peters is synonymous with financial services in the BVI having spent much of his working life in the jurisdiction at Harneys, coupled with his centre stage role in drafting the 1984 IBC Act. Additionally, he served on a multiplicity of committees engaged in providing strategic guidance to the sector since its inception in the mid 80s. Since retirement Richard now resides in Germany.

You have witnessed and played a pivotal role from a unique vantage point in the private sector and also as a former member of the FSC Board, in shaping the evolution of Financial Services in the territory, over an extended period. What do you see as its next chapter?

Well, I’ve been away from it for too long really to know. Many of the topics at the conference, I’m only too well familiar with, but the new thing for me was the last panel, Bitcoin and all related matters. I don’t really grasp it, I haven’t bothered to, but there’s a lot there. There’s also a lot of confusion and uncertainty around cryptocurrencies, but I don’t think that’s unique to here. I think the United Kingdom is more or less the same way. Beyond that it’s really hard to say. When I’m at home in Germany, I don’t hear that much about offshore jurisdictions, except recently the Pandora Papers. I would have thought the sector would probably have been carrying on more or less the same since I retired. I think my main concern now would be the results of the Commission of Inquiry.

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Are there any particular decisions or elements in your estimation that we have to look at if we want to continue to be successful? Even if that means, as you’ve said in the past, “sticking to your knitting?”

It’s things that have been discussed for years. If we just had a few relatively high end hotels here on Tortola, we could have a few conferences like the one we have just held. And if a few companies, like they have in Bermuda, set up here and had an actual office here, just a few of those, I think it would go a long way to demonstrating that there is some real substance in the BVI. Coming here this week, I stayed at the Moorings. We had no network connections (meaning internet and telephone connections) on Wednesday. There was no telephone directory in the room or any information about Road Town and businesses there. If one went to the front desk before 8:00 in the morning there would be no one there.

Do you think that the BVI as a jurisdiction has seen its high-water mark with its success of the Business Company Act?

Probably, I think much depends on what happens with developments surrounding Bitcoin and other cryptocurrencies. I think that something could well be developed in an area like this. Robert Mathavious and I were always discussing new ideas - constantly. Some of them might have been “off the wall”, but even if only one out of every 10 ideas discussed comes to fruition, then something positive for the BVI can be developed. I think that’s the point. You need a few people like this who can sit back and view the whole picture and not just the here and now. The big question, is just how many such people are there and is there a space and structure for such thinking.

In that same vein, do you think we have lost the entrepreneurial and innovative zeal that drove the early days of the sector?

I don’t necessarily think so. I think it goes back to human resources. Continually bringing people in together with local leaders in the space and communicating constantly with leaders in the private and public sector throughout the world. Much of it comes back to that. So I think there is still hope there.

matters discussed and if far too wide it could even lead to a type of populism.

Is there another country/jurisdiction that you would point to that is perhaps a model in that regard that the BVI should look at?

In some ways Cayman and Bermuda in the region and perhaps Luxembourg and Liechtenstein in Europe.

What about Delaware? Should the private sector be playing a more definitive role in guiding the sector strategically, in partnership with the government?

In principle yes, and I think the main problem is that many in the private sector, even Harneys now, are in several jurisdictions. We went through this issue when I was at Harneys. We were just in BVI and for a very long time synonymous with the BVI, but we decided to start up offices in jurisdictions that competed with the BVI to various degrees. I think it's having a real commitment to the BVI that is critical. Now from the point of view of the firms, it is a matter of risk management, so it’s understandable. As a business leader, one must consider risks at all times and also come up with ways of managing this risk. Going multijurisdictional is one fairly obvious way of managing risks. I think the trust companies all have the same challenge: How does one combine these two, i.e. one jurisdiction and multi-jurisdictions, and that's what needs to be worked out. I think it’s doable. I spent a lot of time in Hong Kong, and of course Hong Kong was at the time essentially an extension of the BVI, but it gave me a clear view as to how the competitor jurisdictions fitted into the bigger picture and what they had to offer that the BVI did not have. This is a tough area. You need a few key people in the private sector or with private sector experience to think and discuss these issues. The focus is on “a few key people” and not spread things too widely. Spreading things too widely causes dissipation, dangers of leaks regarding

One of the things that is fascinating with the Delaware model is, yes, they have the regulations, and other headaches and burdens, but it seems that there is a also a very close relationship between the regulator and the private sector, where constantly market evolutions and demands are infused back into the legislation. They have a very good legal culture. Obviously, I followed Delaware closely. The US States have control of the corporations. It’s only recently that the US Treasury has been trying to get involved with systems to establish beneficial ownership of all US companies.

For the BVI as a jurisdiction, Asia has been a leading growth engine in Financial Services. Do you see this continuing?

I think so. I think much depends on the China-United States relationship, and then European Union-China and UKChina relationships. I think the EU still wants to remain close to China. The UK is out of the EU, the biggest trading bloc in the world, so it's sort of natural for the UK to follow the US more than before Brexit.

But you certainly see Asia continuing [to be a driving force]?

I think that will continue. It is not only China but also other parts of Asia as well. I spent a lot of time there and the BVI was very popular throughout the region.

Where do India and Africa fit into the picture as potential growth markets?

India we made some attempts at, but nothing ever came of those early efforts. Of course, I have been away from things for several years now. However, with respect to Africa, I think there will be growth there. How fast I don’t know. Latin America has never really been all that successful largely I believe because it has a different legal culture.

I am sure you were aware of the McKinsey study which was completed a few years ago by the BVI government. Is it time for McKinsey 2.0, focused on the next chapter, even though there was some discussion at the conference, that some of the things from the first study are yet to be implemented?

The problem is that you have to pay for this. I hesitate to pay money for consultancies which tell you a lot of what you should already know, and some new things that don’t get implemented anyway. So I’d be hesitant. I think key individuals in the private sector that we have already discussed could do this and probably at no cost.

Having sat on the FSC board, what evolutionary steps should the Commission be taking as the sector moves to the next level?

I think the Board can be stronger, and one thing I’d like to see them do is for the Chairman of the Board, together with the Managing Director/CEO of the Commission going around and visiting every institution in the private sector. This would be without pen and paper as it would not be an inspection. It would be purely a step get to know everyone in the private sector and to have a good relationship with them. Robert did this once at Harneys before the establishment of the Commission. I think this would go a long way to improving relations and giving the Commission even more respect among the private sector and also, I think the private sector would have a better understanding of the Commission.

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Over the week, you have attended all of the events celebrating Robert’s consequential contributions to the territory as a public servant and for the last two decades as a key influencer in the financial services space. What were your highlights of the week?

to be making this real contribution globally to the bigger picture. And I think something like this could be done, but one needs a few “thinkers” in the private sector to drive it forward.

I was quite pleased with the conference and I stayed through the whole thing. Even though I’m removed, I am familiar with all the various initiatives. The new things were Bitcoin and related matters, — I was quite pleased with the conference. I thought it was run very smoothly and professionally. It went far beyond what I was expecting.

That’s an interesting one. We did an article, I think it must have been while Obama was in office, about that same subject. And we thought it was an interesting idea that it fits the BVI brand and it’s forward leaning.

Your remarks at the Meet the Regulator event honouring Robert on Tuesday were quite heartfelt. What three elements of Robert’s legacy would you see as the most lasting?

I think the investment in local talent and encouraging young people really stands out. That’s his real legacy: taking an interest in people in a way that very few people, including myself, have ever done. This is why I regard him as not only de jure leader of the Commission, but also de facto leader of the public service in the BVI. I think being totally dedicated to his work, living and breathing it. In this regard, he was to the Commission as I was to Harneys, which is probably why we got on so well. Also, he was able to think strategically outside the confines of the BVI.

The world seems to have finally accepted that going green is a must. As the global economy makes that transition, where do you see growth opportunities to which the BVI must attach its wagon?

I see it at least as a shield. Something one of my partners and I had discussed years ago with then Premier Ralph T. O’Neal and another Minister, was to increase the government fee for companies by $100. Government would be given $50.00 for the Consolidated Fund and then the other $50.00 would be placed in a separate fund to be used for carbon trading. A lot of details would have to be worked out, but I think something could be developed along these lines, that would take some of the pressure off the tax initiatives, because the BVI would be seen

It appears that COP 26 (the United Nations climate change summit held in November) was not really that successful. The BVI is not really in a position to get directly involved in such matters. But I think the idea I have just suggested would be helpful, as it would help the larger environmental efforts and also help deflect some of the onslaughts the BVI is being hit with from the various international agencies and initiatives. I think it is such a relatively easy thing to do and … and it helps the brand.

You’re now fully retired — what’s consuming your thinking and time these days? Gardening?

Gardening (laughs). In terms of what I think about, for a long time it was Brexit. With Brexit we lost our EU citizenship. The referendum took place exactly two years after we left the BVI. There was uncertainty. We had to apply for residence last year. So when I go back home, I must show not only my UK passport, but also my German Aufenthaltstitel (residence permit) to show that I am entitled to live in this particular Schengen country, because the UK is no longer part of the EU. But we keep busy. … You know, we have a very big house, with a large cellar. I’m into wine and we take the dog on walks in the forest. My wife and I are both from farming backgrounds.

Given that you certainly have a tremendous breadth of experience about the BVI, particularly in the financial services space, have you ever thought about writing?

It has crossed my mind, but I don’t see myself having that much discipline and I don’t think there’d be that much readership, so I’m not sure it would be time well spent. On the other hand, it would be interesting.

This interview has been edited and condensed for clarity.

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Global Currents Conference Gala The House That Mathavious Built

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ROBERT'S YEARS BY THE NUMBERS Population

Education Enrolment @HLSCC

30,237

30,000 25,000

1,500

29,355

28,654

26,096

1,211

1,250

22,329

679

20,313

20,000

1,000

957

838 757

15,000

750

10,000

500

5,000

250

708

0 2004

2000

2008

2012

2016

2020

2004

2000

2008

2012

2016

Total Central Government Revenue

387.9

350 300

200

192.3

181.2

186.5

183.0

2000

2001

2002

278.6

2007

2008

268.6

272.9

2009

2010

292.8

284.0

302.4

318.6

317.6

305.4

363.9

295.2

247.8

234.3

250

275.7

2020

204.7

150 100 50 0 2003

2004

2005

2006

2011

2012

2013

2014

2015

2016

2017

2018

2019

Nominal GDP Current Prices, $US millions 1,500 1,250

1,404.6

1,307.8

1,382.7

2016

2017

2018

1,279.9 1,115.0 1,071.5

1,114.5

1,129.5

2012

2013

1,200.5

1,000 750 500 250 0 2010

Budget

2011

Recurrent Budget

Capital Budget

IN BOLD

2014

2015

Total Budget 412.4

406.7

400 350

325.7

328.2

327.5

2015

2016

2017

393.2

301.2

300

279.7

270.6

273.5

286.7

256.3

248.1

250

280.9

229.1 214.2

200 150 100 50 0 2005

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2006

2007

2008

2009

2010

2011

2012

2013

2014

2018

2019

2020

Tourism Type of Visitors

Overnight Visitors

Cruise Ship Passengers

Day Trippers

IN BOLD

Total Visitors 1,124,380

1,000,000

934,268

900,000

812,908

838,382

825,603

753,148

800,000

755,384

700,000 600,000

543,423

519,409

500,000

408,972

400,000

305,254

300,000 200,000 100,000 0 2000

2002

2004

2006

2008

2010

Cruise-Ship Calls 447

400

2014

2016

2018

2020

539

500 335

2012

352

405

367

300

462

442 408

398

372

387

397

412

384

269

244

200 100 0 2000

FSC IBC/BC

2001

2002

2003

Total No. of IBCs/BCs Incorporated per year

2004

2005

2006

2007

2008

2009

2010

Total No. of IBCs/BCs (Ever Incorporated)

2011

2012

2013

2014

2015

2016

Total No. Active IBCs/BCs

1,600,000 1,431,269 1,312,849

1,382,757

416,784

402,907

366,364

50,829

31,769

37,415

22,362

2014

2016

2018

2020

1,400,000 1,235,151

1,200,000

1,130,988 1,002,197

1,000,000

895,096 756,358

800,000 632,890

600,000

524,902 422,203

414,620

459,364

459,005

457,971

400,000 200,000

64,158

51,464

60,451

65,284

2002

2004

2006

61,716

59,624

2008

2010

64,062

0 2000

2012

FSC Revenue 250

230.1

225

214.4

200

182.0 164.9

175

168.0

169.9

144.1

150 125 100

183.6

97.1

100.3

109.0

75 50 25 0 2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

2020

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DR.

“Wise counsel, generous spirit and a deep loyalty to the people of the British Virgin Islands”, were the sentiments shared by the former CEO of the RDA, about Dr. Robert Mathavious. These thoughts continue to hold true and stands as the common views held by the Members of the Board and the Staff of the Virgin Islands Recovery and Development Agency (RDA).

MATHAVIOUS

In its infancy, the RDA required leadership and technical capacity that would instil confidence in the BVI and its international partners alike. It sought to rebuild the Territory after a particularly intense and devastating triad of a flooding, followed by two catastrophically intense hurricanes (Irma and Maria). From its inception, and most likely because of the involvement and endorsement of Dr. Mathavious, the RDA has successfully navigated through political, legislative, and social challenges. The Agency was guided by his wisdom, strong sense of fairness and respect for all. Within the RDA, there has always been a sense of security under his leadership, and interactions with him were always filled with humour and friendly banter.

How could one individual straddle the widening chasm between opposing political parties, the deep divisions in the civil service, trusted by both the United Kingdom and the Government of the Virgin Islands, and have the confidence of national and international organizations? Through his leadership, the impossible became plausible and a certainty. Today, the RDA has become, in the words of citizens and leaders alike, “a beacon of hope in a Territory that is weary and burdened with the cares and casualties of COVID-19”, upheaval in the region and beyond. Perhaps the cause of his ability to unify, beyond evident intellect and self-effacing charm, is a prevalent and endearing thread of humanity and decency that is void of partiality towards frivolous jousting but focused instead on the upliftment of his beloved Virgin Islands.

Perhaps it is through lengthy tireless dedication and service to his community, mentorship to young people and not so young alike, a nonthreatening source of wisdom, and or his ability to speak truth to power, that he is able to be a magnet to opposing forces. Maybe as well, it is the manner that he consistently reminded us at the RDA that above all, beyond the Gantt charts, intricacies of planning and risk management protocols, all that really matters is people. The service that we are tasked to provide aims to raise the Territory up like a phoenix from the ashes, to be a resource of hope in the face of challenges, and carryout our integral part in the development of a brave new world for our Territory and its people. The Board of Directors, Management and Staff of the Virgin Islands Recovery and Development Agency would like to convey our greatest appreciation for Dr. Mathavious’ contribution to the Territory’s recovery efforts, the legacy that he has built through his visionary and selfless leadership, and the support of the BVI over decades of commendable service. Dr. Mathavious, in the RDA, we hold it to be self-evident that many in the BVI are sitting in the shade today because you planted seeds a long time ago – adaptation of a quote from Warren Buffet. FROM THE BOARD, MANAGEMENT AND STAFF OF THE VIRGIN ISLANDS RECOVERY AND DEVELOPMENT AGENCY 78

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The Strategist and the Kingdom of Pasea

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experience of numerous matches: internal and external, international and domestic, and battles of jurisdiction, and battles of sovereignty. His philosophy for choosing battles, undoubtedly made for interesting strategy, tactics, and outcomes. Mr. Mathavious moved urgently, decisively, and pragmatically in times of uncertainty. He admonished domestic stakeholders to learn from the lessons and to put the setbacks behind as he navigated crushing headwinds. Reputation forms over time, and for BVI financial services, it was Mr. Mathavious' constant focus. His radar constantly monitored BVIs financial services' reputation globally and scanned for threats to minimize impact. His insistence was that BVI should not be found lacking. Instead, we should consistently meet expectations for service delivery, honouring commitments and offering well-regulated practical and valuable products and services. Mathavious' calm and controlled demeanor inspired others to stay the course and to trust the process to values he expounded. Vigilance, Integrity, Accountability is the FSC's motto. He crafted it to embody the tenets that he knew would inspire. The motto inspires confidence abroad and inspires confidence domestically. His familiar refrain was that each stakeholder group should endeavour to be part of the solution and not part of the challenges. His repeated call was for new paths, new ideas, and innovation.

LEADING THE EMBATTLED DREAM By Jennifer Potter

ommenting on the theme for his retirement celebrations, "The House that Mathavious Built", Mathavious himself rejected it in favour of referring to himself as a soldier in the army. It turns out that's not an entirely apt description either. Hopefully, he would accept that he would better be described as the Army General, as the head of 'the House' for nearly thirty years. BVI doesn't have an army, but surely if it did, protection of BVI financial services would be its primary mission. Building BVI financial services took commitment, effort, skill, and teams. For the army of persons who shaped, grew, and protected this systemically important industry, General Robert Mathavious is a famous and respected figure. Most Generals would assure you that strategy is hammered out in advance and away from the battlefield. Robert Mathavious is no different. His commanding strategy for over two decades, was a battle-ready strategy. In his own words, he chose his battles wisely, "… large enough to matter and small enough to win." He has had the

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So how does a general prepare? For decades of developing strategy, leading troops, managing politics, and sharing a vision? First, there was the vision. He dared to dream and then assemble the plans that would make the dream a reality. Mathavious had to have been an avid dreamer. Especially in the early days, when the financial services industry was so embryonic that all it was, was a dream—a wish and a prayer for the people's triumph. As the general, 'Mr. Mac' led the transformation of the dream into a vision. Then he began assembling the teams; several over the decades were the supporting cast, the able collaborators, the essential allies, and the partners in the trenches. He would use his vision to motivate, inspire and stimulate the actions of others. Mr. Mac believes that if he is unable to convince anyone to do that which is right, then the failure is his. Perhaps he didn't use the right argument or make the argument at the right time. His professional conviction is that his timing must be impeccable, and his words must have integrity. Time and again, he would call on the art of persuasion. Persuasion was a critical asset in his governance arsenal. He would persuade industry leaders and political leaders that the path he was charting was the best of all available options for the BVI. Outside the Virgin Islands, others also recognized his persuasive skills. He would preside over international groups of NATO like allies, joining forces for the common good and ultimately the very survival of those

with shared objectives, if seldom the political might. He shared this vision, dream for the Virgin Islands freely and often with anyone who would listen. He reminded leaders not to lose sight of the ultimate goal, reminded soldiers of why they were called to the military, and ensured the allies that there was always strength in numbers. The strategy, he had to change continuously, to keep pace with the changing circumstances of an industry and a Territory in motion, but the vision and goal remained constant. From my vantage point, it looked like I imagine juggling glass balls would look. Sometimes he was juggling with one hand. But, seriously, so many moving parts and so many people depending on positive outcomes.

Battle 1: Growth and expansion, show up globally As global standards and best practices evolved, Mathavious kept step with what excellence in the international financial services arena required, led the charge to create independence for the BVI financial services regulator, and birthed the Financial Services Commission. The Commission then became the central theme and body around which financial services thrived. The original IBC would give way to the BVI business company. The iconic BVI corporate vehicle, would see an even more tremendous surge in popularity and utilization. Replacing the Mutual Funds Act with the Securities and Investment Business Act, ushered in growth and expansion. Over the years, the public-private partnership would bend heads and join hands, with Mathavious as the bridge to usher in new lines of business. Similarly, the partnership would collaborate to present a united BVI to a global client base, assuring all that BVI was committed to good business, effective products, and services and was a bastion for good regulation. Mathavious was a stickler for proactive action, rather than reactive fixing. To lead in this way, he prided himself on anticipating how the tides were changing and how they would impact BVI business and industry performance. One of his many mantras, was that we should be represented wherever decisions were made that would affect BVI. He knew only too well, that being your own advocate was incredibly important. Therefore, he insisted on BVI being in attendance and adequately represented wherever around the globe decisions that would significantly impact the viability of the Virgin Islands as a successful, premier financial services jurisdiction. Even as others questioned the usage of resources, financial and human, Mr. Mathavious didn't waiver on this point. He was adamant that only BVI could tell the BVI story, the BVI impact, and the BVI position. Nothing else, no substitutes would do. Yet, when consensus seemed all but impossible, he persevered. In the business of international financial services, reputation is king, and threats are constant. Mr. Mathavious counted on relationships to maneuver the twists and turns of international financial services development. When the David and Goliath-Esque battles threatened, Mr. Mathavious moved with agility and precision, armed with preparation. He made it a priority to broaden and increase his available resources by enlisting the help of allies. First, industry practitioners who shared his values and vision. They would be deployed globally to raise the

flag supporting brand BVI. His' friends of offshore', able to represent and sponsor BVI in rooms where we didn't or couldn't have a presence. And a heavy-hitting network of peers. Other regulators and standards setters could help tell the tales of the international corporate domicile of over 500,000 companies.

The Strategist and the Kingdom of Pasea

Battle 2: Invest in talent Mathavious championed BVI financial services that would include Virgin Islands citizens in a meaningful way. As a knowledgeable regulator, he understood that both the private and public sectors require skilled talent to sustain the industry. He introduced a scholarship program for longer term training from within the Commission. He arranged secondment opportunities (private and public) that saw Commission employees venturing out worldwide to develop new competencies. He prided himself on presiding over the development of an industry, that

“He was adamant that only BVI could tell the BVI story, the BVI impact, and the BVI position. Nothing else, no substitutes would do. Yet, when consensus seemed all but impossible, he persevered.” was sometimes recognized as an early adopter of relevant international standards. His strategy is better that BVI determines its course and path than having someone else dictate them. You see, at all costs, Mr. Mathavious held fast to the vision: more opportunity, more business, and greater prosperity. His teaching included, "stay compliant to remain competitive." As a BVIslander with a lion's heart and a global reputation in the balance, Mr. Mac determined that BVI couldn't and wouldn't be found wanting as the weak link in international financial services. And so in 2015, with his time on the world stage winding down and BVI preparing for its next act, Robert A Mathavious, OBE encouraged the industry and his team using the words of the Langston Hughes poem, The Embattled Dream: "This dream today embattled, With its back against the wall To save the dream for one It must be saved for all."

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A FEW WORDS

The Strategist and the Kingdom of Pasea

By Robert Briant

first met Robert Mathavious in 1999. It was a causal meeting, with Benedicta Samuels introducing us. I had just arrived in the BVI, and no doubt Robert thought he was meeting another lawyer just passing through the jurisdiction. Little did either of us know, it would be the beginning of a 20-year relationship. When we met, the OECD had the year before, issued their report titled “Harmful Tax Competition”. Most people did not take the report too seriously, but Robert was quick to identify that it may be the beginning of a trend. He did not take his eye off the ball even when in July 2001, Paul O'Neill, Secretary of the Treasury under George Bush, stated that the United States believes in tax competition, seemingly torpedoing the report. However, the report was reissued by the OECD under a new name, “Harmful Tax Practices”. This ‘new’ report, focused on “know your client” requirements and effective exchange of information. It was the beginning of the regime that we know today, and Robert grasped that at first instance. It was at an ARA lunch on 12 July 2000, that he said that “proper regulation attracts good business”. He was right then and he is right today. Since the publication of that report, Robert has helped stick handle the BVI through numerous related challenges. Many of us will recall the Mutual Funds Act, which was the precursor to the Securities and Investment Business Companies Act, and arose as a result of pressure from IOSCO. BVI suffered numerous audits over the years, whether by the IMF, CFATF, FSF and others. BVI had to implement the EU tax savings directive, and then FATCA and CRS. We also had the self-inflicted wounds, such as the Panama Papers. It has been an unending parade of attacks and challenges, almost of which had people saying it was the end of “offshore”. Throughout this time, Robert Mathavious balanced the needs of the private sector with the requirements of the global bodies, while always acting in the best interest of BVI. He walked that line. While the private sector may have been dragged along at times, Robert did a good job of keeping the global bodies satisfied, while not causing “offshore” to collapse. From a very basic level, this meant introducing KYC requirements on registered agents and then enforcing those requirements. The more BVI was inspected, the more the FSC would audit the registered agents. However, having the information was not enough.

I first met Robert Mathavious in 1999. It was a causal meeting... Little did either of us know, it would be the beginning of a 20- year relationship. The information had to be effectively exchanged with the onshore authorities. At first this was done by written requests, and now of course we have BOSS. Throughout this, Robert helped to protect BVI by ensuring that fishing expeditions were not allowed. However, not all of the time was defensive. It was a pleasure working with Robert Mathavious and Richard Peters on the BVI Business Companies Act. I recall clearly our discussions on the transitional rules, not to mention the annual government fee. Over twenty years later, we are still facing these threats. They really have not changed, although they have become more precise. Today we have to deal with publicly accessible registers of beneficial owners, economic substance and a proposed global minimum tax. New leaders will need to help the British Virgin Islands during these difficult times. However, they can do so knowing the solid foundation built by Robert Mathavious. It has been a pleasure working with him over the years. We will miss him.

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WINNING A LEVEL PLAYING FIELD By Lorna Smith, OBE

In a few years short years, under his leadership, the BVI became a highly respected, top-drawer jurisdiction, offering an array of services second to none. Today, it runs the gamut from the most qualified and experienced professionals providing services for wealth management and asset protection, to first class legal, insolvency and accountancy practices; and from specialist insurance and reinsurance providers, funds administrators and managers, to banking.

A champion of globalisation, Robert’s philosophy has always been that for global trade in financial services to thrive, policy and regulatory decisions must be taken by the relevant players worldwide, whether they reside and work in metropolitan countries like the USA, the UK and China or in small International Finance Centres (IFCs) like the British Virgin Islands, Cayman Islands or Bermuda.

ven as a student, Robert Mathavious understood the significance of achieving great heights: his name would be engraved on the ‘Victor Ludorum’ Board (had we broken down sports in that fashion) at the then Virgin Islands Secondary School, as he out scaled every other competitor in the high jump competition. He noted the subtle use of height when others did not. I recall after a critical meeting in Hong Kong in 1990, his asking whether I had also noticed that our host sat several inches above any of us, including the leader of the delegation, the late Chief Minister, H. Lavity Stoutt. Of course, I had not; but those were the small points that never escaped Robert’s eagle eye. His career constantly reminds me of Henry Longfellow’s famous poem: “The heights that great men reached and kept were not attained by sudden flight.” After completing 25 years of Public Service, during which time he became Financial Secretary, a position he took to new heights, Robert turned his attention to International Business and Financial Services, first in his capacity as Managing Director of the Financial Services Department and later as CEO of the BVI Financial Services Commission.

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Equally, he has always lived by the code - that if money laundering, terrorist financing and other international crimes are to be tackled effectively, the requisite regulations must be drawn up and implemented by all concerned on the basis of a global level playing field, rather than by one group of countries dictating the rules to another. Some 25 years ago, Robert started to become seriously concerned by the way supranational organizations, including the Organisation for Economic Cooperation and Development (OECD), the Financial Action Task Force (FATF) and the European Union (EU), were making and implementing rules intended to stop international criminal activity. Not only were these rules made without IFCs being at the table, but they were also not evenly applied, with IFCs being held to a higher standard than OECD countries, in which wrongdoing was often being overlooked.

The need for everyone, large and small to start operating on a global level playing field had never been greater – and Robert proved central to making this happen.

The world according to OECD countries Up until this century, the rules governing crossborder financial activities were set by organisations controlled by the world’s richest countries and with little interest in being inclusive. Indeed, the founding OECD Convention of 1960 states: “The aims of the OECD shall be to promote policies designed to achieve… a rising standard of living in member countries” (emphasis added). Equally, the US Treasury, a leading member country stated in May 2002: “Our overarching goal must be to maintain the position of the United States as the most desirable location in the world for incorporations, location of headquarters and transaction of business.” The financial world was meant to operate according to the guidance and recommendations put out by international bodies – recommendations developed without the IFCs, but which they were nonetheless expected to adhere to or be criticised as “tax havens” and face the threat of being blacklisted.

Bring matters to a head Small country IFCs were already concerned about how the big, rich countries were conducting themselves when two reports from the OECD Secretariat caused matters to come to a head. Both had the potential to distort international trade patterns to the detriment of BVI and other IFCs. In 1998, the report Harmful Tax Competition: An Emerging Global Issue exhorted OECD member countries to take action against “tax havens and harmful preferential tax regimes”. It set out four main criteria for determining whether a preferential tax regime was harmful: no or low taxation on the relevant income; lack of transparency; lack of effective exchange of information; and a regime ring-fenced from the domestic economy. The report acknowledged, however, that adoption of a low or zero tax rate by itself was not sufficient to identify a jurisdiction as harmful. The OECD urged its member countries to, among other things, terminate existing tax conventions with “tax havens”; impose a substantial withholding tax on payments to countries that engaged in “harmful tax competition”; and develop procedures to address the use of “tax havens” for transfer pricing. It is worth noting that the report was not agreed

unanimously by OECD members. Switzerland and Luxembourg, two highly successful IFCs in their own right, were permitted to abstain. It is also worth noting that many, if not most, of the signatories failed to meet a number of the very standards which the report endorsed. In 2001, the OECD published a further report, Behind the Corporate Veil: Using Corporate Entities for Illicit Purposes. This said governments should obtain information globally on the beneficial ownership and control of corporate vehicles to ensure these were not used for illicit purposes. Both reports thus had significant privacy and other implications for many IFC jurisdictions and their clients.

The Strategist and the Kingdom of Pasea

In the face of these challenges, Robert Mathavious was one of a small group of leading IFC players who saw the need to respond to the OECD on its own terms – as a collective group of countries and with factual argument. Never one for a knee jerk reaction, over time Robert became a key architect of a change in the way the game was played and IFCs were perceived.

“Equally, he has always lived by the code that if money laundering, terrorist financing and other international crimes are to be tackled effectively, the requisite regulations must be drawn up and implemented by all concerned on the basis of a global level playing field, rather than by one group of countries dictating the rules to another.” The ITIO: an idea whose time had come Robert’s efforts to get IFCs to respond collectively to the OECD were rewarded when 11 jurisdictions, including the BVI, came together in 2001 to found the International Trade and Investment Organisation (ITIO). The previous year, in response to complaints from IFCs, the OECD had opened the door a crack by inviting seven IFCs to join a tax competition Working Group with six OECD members, OECD officials and the Commonwealth Secretariat. Robert led the BVI delegation at these meetings and worked to build trust and comradeliness among the IFCs. The IFCs found that they worked well as a group. So, when the OECD turned down their request for a more inclusive forum, they decided to band formally together in the ITIO, with the support of the Commonwealth Secretariat. Barbados’ then Prime Minister Owen Arthur made the announcement on behalf of the members. The ITIO’s chief aim was the development of a “balanced approach” globally to international tax and investment issues. It actively supported members to form a common position in negotiations with the OECD and it supported relevant research.

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Robert’s role in establishing the ITIO was key. The years he had spent building up the BVI as an internationally recognised quality IFC, his strategic mind, his warm personality and his rare and generous support and encouragement of other IFCs (who often treated each other aggressively as competitors) meant he was liked and, crucially, trusted by all. With his active engagement, the ITIO became a rare example of IFCs actively collaborating to get better results than their usual way of going it alone achieved. Over time, it grew to 17 members. The group would meet in members’ countries or at the Commonwealth Secretariat in London. The BVI; Anguilla; Antigua & Barbuda; The Bahamas; Barbados; Belize; the Cayman Islands; the Cook Islands; the Isle of Man; Labuan; Panama; Samoa; St Kitts & Nevis; Saint Lucia; Saint Vincent; the Turks & Caicos Islands, and Vanuatu, fought in the trenches for fairness and for the acceptance that countries large and small – whatever their state of development – had to work on an equal basis in order to stop organised transnational crime from penetrating national boundaries. ITIO member countries spoke with one voice, having first agreed common negotiating positions towards the OECD. They shared with each other what the OECD was telling them individually, exposing and undermining its attempts to play the old game of divide and conquer.

Towards a level playing field The ITIO also worked closely with allies, including the Commonwealth Secretariat and the Society of Trust and Estates Practitioners (STEP). To ensure that the facts on the table were not just those published by the OECD, the ITIO and STEP commissioned international law firm Stikeman Elliott to undertake a global review of the regulation of corporate vehicles in cross-border transactions. The subsequent 2002 report, Towards a Level Playing Field, provided empirical and irrefutable evidence for the first time that the regulation of corporate service providers (CSPs) was more effective in IFCs than in some OECD countries, including the USA. This was clearly unacceptable. Unless all financial centres implemented the rules in the same way, the global financial system would remain susceptible to international crime, terrorism and more. Not only was trade in non-resident financial services global, but 80 per cent of it was located in OECD member states. Stopping illicit activity could not, therefore, be confined to a limited group of countries. To that end, Towards a Level Playing Field proposed that the design of any new rules for combatting trans-border crime must include: • All countries being subject to the same rules for any given activity, implemented on the same timetable with the same consequences for non-cooperation;

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• Policy discussion and decisions in a universal forum; • Appropriate regard to competing considerations such as reasonable privacy; and • Regulation proportionate to the risk and benefits of the activity being regulated. The report further found that the OECD’s Behind the Corporate Veil was largely anecdotal, non-introspective and non-benchmarked in its approach, with little research and no clear methodology – and, as usual, no non-OECD input. Stikeman’s detailed analysis also revealed that regulation of corporations, bearer shares, disclosure of beneficial ownership, filing and auditing of accounts and regulation of service providers, were considerably better managed by IFCs than inferred by the OECD report. Perhaps most significant, the report demonstrated, as mentioned, that CSPs were better regulated in a number of non-OECD jurisdictions than in OECD member countries. It showed how, even while seeking tighter regulation of corporate vehicles in small countries, the OECD had been excusing large corporate domiciles such as Delaware and Nevada in the USA from compliance with new rules to regulate service providers and track beneficial ownership. Despite all of this, Behind the Corporate Veil had been endorsed by G7 finance ministers. The sheer hypocrisy of OECD countries was laid bare. IFCs everywhere felt vindicated. Referring to the findings of the report on the eve of the Commonwealth Finance Ministers meeting in 2002, Owen Arthur declared: “OECD members should recognise that the problem of international corporate crime needs to be addressed in all countries, including themselves.” He added: “As this report shows, times have changed and many small and developing countries are very well regulated. To avoid seeming protectionist in a world where free trade agreements are proliferating, the OECD must insist that all finance centres improve regulation to the same degree and at the same time.” The OECD now found itself on the back foot and became more amenable to listening to IFCs’ demand that change should happen only on the basis of a level playing field. After years of being dismissed as “tax havens”, the BVI and other IFCs began to be mainstreamed, with a greater international appreciation of their role in the global economy and greater input into the development of international regulations. In all of this, Robert’s role was key – including ensuring that the BVI government made a significant contribution to the costs of the ITIO/ STEP review! Ever the modest public servant, he made no public pronouncement at the time, but in several subsequent speeches to jurisdictions in the Caribbean and beyond he drew attention to the Level Playing Field report’s impact: “What the ITIO and STEP accomplished sent the message back to the OECD, Whitehall and Washington that International Finance Centres have a legitimate role to play globally.” But Robert never viewed this watershed as a reason for complacency. While some made the mistake of thinking that this setback for the OECD gave small country IFCs an excuse not to change, he saw that it was only a staging post in a longer journey.

Ever a pull-no-punches speaker, he had already given this warning to a Caribbean audience in 2000: “Offshore centres which are prepared to make certain concessions may well find that business can continue along familiar lines. Those who stand bravely in front of the tornado and claim that they will make no concessions may be swept away. To claim that the collective decisions of world governments will not affect countries that are no longer colonies is in my opinion unwise and at best a very short-term response.” Over the years, he oversaw far-reaching improvements in the BVI’s supervision and regulation, and supported the industry in developing activities in new spheres. He built a strong value proposition in financial services that gained positive recognition from the international regulatory community and has placed BVI ahead of its competitors in many areas.

A Caribbean patriot I have touched on Robert’s generosity to others and how this helped build the trust so essential to the foundation of the ITIO. His open heartedness in sharing his knowledge with the entire region without reservation is legendary. There is not one country in the Caribbean – or beyond for that matter – desirous of sharpening their financial services management capabilities that, on asking Robert for help, has ever been denied.

to help CARICOM members devise their own strategies for commitments to the OECD. And Robert successfully led an ITIO initiative which resulted in the OECD dropping the most burdensome and ineffective parts of its proposals around the auditing and filing of accounts. I asked Glenroy Forbes, who was also its last serving Chair, what the cause was of the ITIO’s demise in 2005. He cited people changes, inadequate financial resources and a gradual return by jurisdictions to acting bilaterally. This underscores Robert’s view that too many members of the ITIO mistakenly thought that winning the level playing field battle meant they had won the war.

The Strategist and the Kingdom of Pasea

Glenroy told me, “There is the need for an ITIO type of organisation in this space today”. How true! In the face of demands for public access to beneficial ownership information and greater evidence of “substance”, a focus on the greening of financial services, moves towards a global minimum corporate tax rate and much more, Robert’s focus on bringing IFCs together to develop a joined-up response is as relevant as ever. We need a new ITIO!

Not long ago a friend and I jokingly wondered whether Robert’s consistent generosity and helpfulness could be partly enlightened self-interest: if other IFCs do well, so does the BVI! Yet nothing could be further from the truth.

“But Robert never viewed this watershed as a reason for complacency. While some made the mistake of thinking that this setback for the OECD gave small country IFCs an excuse not to change, he saw that it was only a staging post in a longer journey.”

Robert is a true patriot, both for the BVI and the Caribbean region as a whole. As Glenroy Forbes, his successor as Financial Secretary back in 2000 and founding partner at Forbes Hare, said to me recently: “Robert is a big picture guy, on both the Caribbean and global scene, who has a deep-seated desire to see the Caribbean region realize its full potential in financial services.” It came as a surprise to no one when Robert was awarded an honorary PhD by the University of the West Indies for his stellar contribution to international financial services in the Caribbean. Robert We still need an ITIO Sadly, the ITIO only lasted a few years. But in that time, it achieved many things, as Robert reminded people in numerous speeches. It developed joint strategies for members around the OECD’s harmful tax competition initiative. By stating common demands, IFCs achieved more than if they had worked alone. In particular, they succeeded with their united message that the OECD must operate on the basis of a level playing field and include all committed jurisdictions in its Global Tax Forum. It also engaged with FATF on the revision of its then 40 Recommendations, highlighting how FATF countries themselves would be blacklisted under a fair process. The BVI and Barbados took forward, work begun in ITIO meetings

Over the last 30 years, my strong, kind, clever, patriotic, dedicated, rigorous, generous and God-fearing friend Robert Mathavious has been a leader in the international and regional financial services arena. He helped win international acceptance for placing IFCs on a level playing field with large countries. His work led the BVI to punch above its weight in financial services, to stay ahead of the curve, to build allies and to create a strong international reputation by placing good regulation and supervision to the fore. Robert also realised that the fight to remain a mainstream jurisdiction is a never-ending task – one which the Financial Services Commission is pursuing with the same diligence today.

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THE PANAMA CONNECTION By Dr. Jaime Alemán

n February 25th 1987, President Eric Arturo Delvalle and I, as Minister of Justice of Panama, took the monumental decision to dismiss General Manuel Antonio Noriega, accused of money laundering by the United States of America, as head of the Panama Armed Forces. As a result of our decision, Noriega staged a coup d’etat and took full control of the country. Mayhem ensued, and the Panamanian financial sector suffered a monumental shock, which resulted in banks closing their operations for nearly four months. The country’s economy totally collapsed, and I was forced to go into exile in order to avoid being jailed. As you can surely understand, this was also a horrible blow to my law firm Aleman, Cordero, Galindo & Lee, as well as to all the other leading firms in Panama. Our country had been one of the leaders in the provision of international corporate services in the world since 1927, when Law #32 governing corporations was enacted. The law, which was based on the most modern elements of similar laws in existence at the time in the United States, combined with the fact that Panama has a territorial tax system, allowed the growth of a strong and reputable international corporate system based in our country. Another factor that was instrumental in

this growth, is that many of Panama’s leading lawyers have traditionally been educated in the best American and European law schools, which in turn made it easy to expand their businesses abroad and develop strong relationships with the leading banks, accounting firms, fiduciary companies and law firms from literally every corner of the world. Law # 32, together with the shipping law enacted in 1925 which allowed for the Open Registry of large vessels, engaged in international commerce, made Panama a leading player in international financial services long before the world became as globalised as it is today. In subsequent years, Panama enacted two key laws that expanded Panama’s role in the international financial world. One of them was the Law #18 of June 17th, 1948 that established the Colon Free Trade Zone, which allowed for the importation and subsequent export of goods without payment of import duties or income tax. As a result, many of the leading distributors of electronic equipment, liquor, perfume, clothing, watches, jewellery, medication and other products, set up operation in the free zone, which over time would become one of the largest and most important in the world, helped to a large degree by its enviable position at the Atlantic

“We made a quick analysis of the existing alternatives and rapidly realised that the BVI International Companies Act, 1984 offered many of the same advantages of Panama´s corporate law, and at the same time provided two key elements that Panama no longer did: political stability and a solid and strong judicial system.”

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entrance to the Panama Canal. Many of the leading companies from Asia and Europe used the Zone as their basis for distributing their products to the Caribbean and Latin America, generating thousands of jobs and vast wealth for the country. The other law that enhanced even more, Panama’s role in the financial sector was the banking law of 1970, which together with the fact that Panama uses the US dollar as its official currency, led many international banks to set up operations in there, thus creating many high paying jobs and also cheap financing for the Panamanian housing and business sector. This led to an economic growth that made Panama one of the wealthiest and most prosperous countries in the region. The events of 1987 however hurt the country’s image enormously, and the users of Panamanian corporations started asking us for alternatives for corporate services, which would give them the feeling of safety which the country no longer offered. Investors’ confidence can turn in a second, and this is a classic example of how that can happen. There’s nothing that makes an investor more jittery than political turmoil and the lack of legal and judicial certainty, which Panama no longer provided. We made a quick analysis of the existing alternatives and rapidly realised that the BVI International Companies Act, 1984 offered many of the same advantages of Panama´s corporate law, and at the same time provided two key elements that Panama no longer did: political stability and a solid and strong judicial system. Mr. Paul Mason of Euro-American Trust Management Services, approached our law firm as well as other leading Panamanian firms and offered to assist in setting up operations in the BVI. We were immediately convinced of the advantages offered by the BVI, and visited the territory to meet with the authorities. We were overwhelmed by the natural beauty of the place, the kindness and capability of its people, and even more importantly, by the keen knowledge of the international corporate world that the regulatory authorities demonstrated. We were also highly impressed by the enthusiasm that the authorities showed towards our presence in the BVI, so most of the large Panamanian firms immediately reached the conclusion that it was the best alternative available in order to provide services to those clients who no longer wished to use Panamanian corporations as investment vehicles. These developments were in turn, a shot in the arm to the BVI, which was then in the incipient stages of developing its international corporate activities. The world wide connections that the Panamanian law firms had developed over decades, proved to be a blessing to the industry. But in addition to its International Companies Act, 1984 the BVI had a secret weapon that would prove to be invaluable over the years in the figure

of Dr. Robert Mathavious, a brilliant economist with a bachelors degree from the University of the West Indies and a master’s degree from Georgetown University. Dr. Mathavious was not only smart and well educated, he was also a true visionary who had the savvy and foresight to guide the BVI Financial Services Commission from its early stages, until eventually positioning it as the world-wide leader of corporate services during a turbulent period. A period, which required many changes and innovations, as well as having to deal with major adversaries abroad who viewed the BVI’s unparalleled success with suspicion and envy, and were constantly insisting on the need for changes.

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Dr. Mathavious was an affable person, with the diplomatic skills of a seasoned Ambassador, who not only managed to navigate the turbulent times described above, but who more importantly managed to build from scratch the BVI Financial Services Commission and turn it into the well respected institution that it is today. An institution staffed with incredibly well trained professionals, all of them from within the BVI. The industry has raised hundreds of

“But in addition to its International Companies Act, 1984 the BVI had a secret weapon that would prove to be invaluable over the years in the figure of Dr. Robert Mathavious, a brilliant economist with a bachelors degree from the University of the West Indies and a master’s degree from Georgetown University.” millions of dollars for the territory, and led to the construction of an impressive infrastructure, including a fantastic government building, a modern airport, a reputable college and a cruise port which has in turn provided a boost to the tourism industry. There are over ten Panama based trust companies operating in the BVI, and they have an important part of the market share. It has been a mutually beneficial relationship. In our particular case, for over ten years our office has been fully staffed by local people, led by our CEO Ayana Liburd, who has vast experience in both the public and private sector in the BVI. Our staff has done an incredible job of providing world class service to our clientele. They are an integral part of the ALCOGAL family, and an important factor in our success. Another important element to keep in mind is that even though Dr. Mathavious recently retired, he’s been replaced by Kenneth Baker, who worked closely with Dr. Mathavious for years and has earned the respect and esteem of everyone in the industry. He has done a fantastic job as the new head of the BVI FSC, thus guaranteeing the BVI’s future success as an important player in the international corporate sector.

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GLIMPSES OF HIS STRATEGIC PROWESS, IN ROBERT-FASHION By Clarence Faulkner

trategic, relentless, patient are merely some of the words I use to describe Dr. Robert Anderson Mathavious, affectionately known as Mr. Mac. Anyone having had the pleasure of either working with or conversing with him, learning from him, or seated in some meeting room or auditorium, hanging on to his every word, will comment on his brilliance and purpose-driven resolve. I believe that, despite his many strengths, Robert’s true gift is his keen eye for talent and his perceptive view on the importance of relationships in all that he aspired. Considering the many years of his distinguished career, one could take an introspective look at his idealistic work and contributions and BVI’s journey in the financial services continuum and ask, how did we not see that coming? 'That,' at the time was the thrust of a financial services market in the British Virgin Islands that ushered in a culture that encompassed new relations, new rules, and a new way of life. I suspect we may not have seen ‘that’ coming because we were confident it would be addressed, or that a solution was imminent – given who was at the helm. The significance of the financial services sector to the BVI’s economy and the economic

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multiplying effect spans generations past and those yet to come. In a world where the emphasis on ‘good governance’, ‘transparency’, and ‘accountability’ sounded more like buzz words, Robert's actions demonstrated that his plight would reflect the true content of his character and that also of the Territory he holds dear to his heart. Robert recognized early on that for the BVI’s financial services sector to thrive, there must be complete and distinct independence of the Regulator and the strengthened confidence of our global stakeholders. True independence also meant that the Regulator would experience no political interference in any of its decisions. In fact, any global attack on financial services was met with a swift response or solution, aided by the requisite legislative endorsement or reform by the sitting Government. Some would argue that the changes resulted due to the importance of the sector to the Territory. Conversely, I believe that someone had to drive the process. Someone had to soar above the turbulence, and someone had to be brave enough to embark on a journey that would contribute to and elevate the economic wellbeing of these islands we call home.

Robert, knowing that he could not do it alone, gave us glimpses of his strategic prowess. As the demands for an independent, impartial, and fair regulator took shape on an ever-changing landscape, he knew that there was a need for the right pieces. So, in Robert-fashion, he proceeded strategically by either identifying competent individuals, who in some instances were on the opposite side or receiving end of the Regulator’s proverbial blade or those who demonstrated that they possessed the aptitude and needed the right environment to excel. Robert was the facilitator. If you were considered an expert in the field of concern, coupled with a mindset of discipline, conversion to the Commission was a mere discussion with Robert. Robert got what he wanted, not because he was arrogant or because he treated financial services in the BVI as his ‘turf,’ but because his methodologies were commensurate to an enthralling chess match – tactical with a hint of subtlety that one could unknowingly overlook. His vision, actions, and leadership were magnificent and inspiring. I have not met someone who has departed Robert’s presence and was left feeling confused, bewildered, slighted, undermined, or insulted. During discussions, he ensured that you were aware of the issues, the challenges and provided a bit of history paired with a proposed solution – if not two or more. I use the term solution, because he always gave his audience’s input the credence it deserved in finding practical solutions. His guidance, approach and stance were immediately met with respect and a sense of calm that all would be okay as you departed his presence. In building his Team, he insisted on all team members receiving the necessary exposure and training. This exemplified his belief that governments, service providers, clients, and competitors would look to them for guidance, enforcement, and confidence in a jurisdiction regulated by them. There was never a knee-jerk reaction in anything Robert did. His patience is by far one of his most extraordinary qualities. Another, is his ability to process and respond to information and situations resulting in solutions that impact all likely to be affected. Having heard his name as I entered the Virgin Islands’ workforce in the early 90s, it was not surprising that during our first encounter, I was jolted by the voice that thundered, “young man, I am hearing good things about you." My awestruck and humbled response was, “Is that so?" to which he stated, "I have been told that you are one to look out for.” I was immediately struck by his words and felt duty bound whereby if they were not true, I needed to ensure that they were, because the man himself insisted that I was one to observe. As time passed, Robert and I developed a bond where we did not speak regularly. However, where the occasional opportunities arose, our conversations interestingly flowed with a familiarity likened to daily dialogues. I have since been on the receiving end of some of Robert’s strategic machinations

and requests. As a result, I developed a greater appreciation for discerning the variance between a need and a want. If Robert indicated that he needed me, I knew that it would involve more than just completing a task. It was likely a component of a holistic approach that would result in the overall greater good for the Territory. An outcome that would benefit, and resonate with, our people, strengthen our reputation in the global market and propel the Territory’s economic development. When the sitting Government requested that I assume responsibility for advancing the National Bank of the Virgin Islands' transition from a development bank to a commercial bank, I reached out to Robert, as the Regulator, to understand the Bank's issues and challenges. During our discussion, he replied, “I now know they are serious about the Bank’s role in these islands, having identified you to lead the way. You have our (the Financial Services Commission) full support”. His words were not empty, as he was always available for a quick chat or a call when I made reports and tough decisions concerning the Bank.

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There was never a knee-jerk reaction in anything Robert did. His patience is by far one of his most extraordinary qualities. Another, is his ability to process and respond to information and situations resulting in solutions that impact all likely to be affected. Years later, Robert phoned me and said, “I have a task I need you to handle." It was assisting with the establishment of the BVI Recovery and Development Agency following the devastation caused by the trio of storms in 2017, as he dealt with his health. Like the Commission, he demanded the highest level of competence, structure, and independence. The BVI was one of seven islands devastated in 2017, and finding suitable candidates to execute the task of rebuilding was of utmost priority. Robert wanted all stones turned to ensure that BVI received the best of what the world had to offer. That is Robert, to his core, nothing but the best for the BVI and its people. I conclude with the unwavering belief that whether it is his baritonestyled leadership or his mild-mannered yet venturous approach, the substance of Robert Mathavious’ contributions will continue to play a significant role in advancing financial services globally. From right where he belongs and is treasured, his home - the beautiful and resilient British Virgin Islands.

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THE BRAIN BEHIND THE FINANCIAL SERVICES COMMISSION ACT, 2001 By Cherno S. Jallow, QC

first met Robert A. Mathavious in October 1995, a few weeks after taking up the position of Parliamentary Counsel in the Attorney General’s Chambers, then under the leadership of Dancia Penn (now Queen’s Counsel). Ms Penn introduced us and in due course would assign me as legal adviser on matters concerning the then Financial Services Department. Robert had come to the Chambers, on what I later learnt was part of routine visits, to discuss and advance matters relating to and/or affecting the regulation and development (generally) of financial services in the Virgin Islands. I was also to learn later from Robert himself that, considering the position he held at the time as Director of Financial Services, he needed two technical allies – the Attorney General and the Financial Secretary. With that alliance and a regular meeting and briefing with the Minister of Finance, his vision for a developed financial services industry in the Virgin Islands would always find collective support..

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And he was right! This was a man who had long figured out that mere technical know-how that is not aided by a vision, with key strategic alliances is not enough. I started learning from him immediately. He embraced me without reservation and effectively inducted me into financial services matters, and thence we developed a professional relationship that would span over two decades. A man of great wisdom and immense foresight and integrity, who put country above self, Robert lived and dreamed financial services business for all the period I’ve been blessed to know him. I know for a fact that even in retirement, his passion for financial services reigns on and no conversation passes on without dedicating time to chatting about the subject. One of Robert’s greatest strengths (and he has many) in steering financial services business in the Virgin Islands, lies in his ability to reckon issues in advance of them becoming a reality. As head of the institution of financial services regulation and development in the Virgin Islands during his decades of public service, he keenly followed and participated in regional and international events and discussions relating to and affecting the global financial services industry. I was impressed with the manner in which he foresaw, before it became a reality, that it was a matter of time before the Financial Action Task Force (FATF) developed policies and rules that would identify and list countries negatively for failures to effectively combat the activities of money laundering and terrorist financing. He convened several meetings that eventually culminated in the drafting and subsequent enactment of the Proceeds of Criminal Conduct Act, 1997. This was shortly followed in 1999 by guidance notes on combatting money laundering and terrorist financing. To complete the process and anchor the Virgin Islands well in a future assessment of its anti-money laundering and terrorist financing (AML/CFT) regime, Robert requested separate legislation on international cooperation, which resulted in the drafting and enactment of the Financial Services (International Cooperation) Act, 2000 (which was subsequently repealed and its provisions subsumed in the Financial Services Commission Act). It was a credit to Robert’s foresight and effort, backed by a supportive Government and Legislature, that when the Virgin Islands was assessed by the FATF against the FATF’s 25 criteria, for placement on the list of Non-Cooperating Countries and Territories (more popularly referred to as the NCCT List), it scored high marks to avoid being negatively listed. Robert did not stop and was never the type to stop inquiring into what might be looming for the financial services industry. He continued to watch events globally as they unfolded, particularly within the European Union (EU), Organisation for Economic Cooperation and Development (OECD) and FATF. The ground was already moving on how to ensure proper, adequate and independent regulation of financial services business as a standard. Once again, Robert moved ahead with alacrity and, in his usual foresight and determination, formulated a policy on how to transform the then Financial Services Department into an

autonomous body that was distanced from central Government control, yet owned by the Government. By this time, I had been on the job as Attorney General for a few months (from November 1999). Since Robert and I worked late hours, our best conversations on legislative reform and general issues affecting the financial services sector and the Territory generally, were during late evenings over the phone. It was during one of those evening calls that he indicated his desire to transform the Financial Services Department into an autonomous institution. As usual, he had already figured out the questions I would ask and he volunteered the answers before I could ask them. He had obviously carried out his research and verified his intelligence regarding the direction of the next storm. He was quite sure that the Virgin Islands could not survive another assessment by the CFATF, IMF or other international assessment body in the absence of a statutorily established - autonomous financial services commission (he was to be vindicated in this regard in due course). In the end, I had only two questions for him: the first was whether he had any drafting instructions and/or literature he could send me to take a look at so we could discuss further. The instructions, well-prepared and structured, arrived the following day in a sealed envelope. The second question was whether he had given thought to how the Government might react to what would essentially become a divorce of the Financial Services Department from central Government. His response was quick and simple. The monies collected on behalf of the Government under financial services legislation, would continue to be collected and passed on seamlessly. Secondly, an autonomous financial services commission would immensely assist in a future assessment of the Virgin Islands, thereby keeping the reputation of financial services delivery in the Territory. And thirdly, the proposed autonomous commission would still be a Government entity answerable to the Government. In his view, it was best to do what was best at the right time and for the right reason. Upon the receipt and review of the drafting instructions and related literature sent by Robert, I was convinced he was on the right track. He had figured out how the transformation should operate and how the new commission should function. Robert was very clear that the proposed legislation should be titled “Financial Services Commission Act” and should comprise the following matters: 1.

a Board of Commissioners whose membership should not exceed seven and whose functions, powers and tenure of office must be appropriately delineated;

2. in order to ensure continuity in the Board’s performance of its functions, the members’ terms of appointment must be staggered in a way that ensures that they do not come to an end at the same time; 3. a new Managing Director who will be the chief executive officer (CEO) of the proposed commission and whose tenure of office must be governed by the terms of his or her appointment to prevent undue political interference; 4. the functions of the Managing Director/CEO must be clearly outlined and should include designation and appointment of nonsenior officers of the commission, with senior officers’ designation and appointment being reserved for the Board; 5. the functions and powers of the commission should be clearly spelt out;

6. the commission should comprise two statutorily established committees to strengthen the governance of the same – the Licensing and Supervisory Committee and the Financial Services Appeal Board; the Enforcement Committee was to be established in due course through an amendment to the Financial Services Commission Act; 7.

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there should be established a Government Trust Account into which the commission shall pay all monies collected on behalf of the Government, including provisions on how payments were to be effected to the Government on a specified periodic basis, the amount to be retained by the commission for its own use (to service budget and development expenses, etc.);

8. provide appropriate account and audit requirements, including preparation and presentation of an annual report; 9. the provisions of the Financial Services (International Cooperation) Act, 2000 should be subsumed in the proposed Financial Services Commission Act and expanded to ensure efficient and effective international cooperation with corresponding regulatory authorities; 10. provide appropriate compliance processes and procedures, including restrictions on disclosure of information; 11. provide a mechanism for an annual meeting between the commission and the Executive Council (later renamed Cabinet under the 2007 Constitution); 12. empower the commission to hire its own team of experts without restriction, while at the same time training local staff to the highest level; 13. provide necessary offences and penalties to enforce compliance with the requirements of the proposed Financial Services Commission Act; and 14. create appropriate transitional measures to transition existing staff from the Financial Services Department to the proposed commission by giving existing employees a choice to either remain with the Government or move to the commission without losing any acquired benefit or entitlement. In the weeks following the issuing of the drafting instructions, Robert worked on developing the meat of the instructions through regular dialogue, most of it during our usual evening phone calls. Each time he reviewed the draft Financial Services Commission Bill (whose structure had by June 2001 taken some good shape), he would come up with some brilliant idea that could be built into it. By September 2001, Robert indicated his satisfaction with

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the final draft of the Bill. He was ready to proceed with it to the Ministry of Finance (his reporting Ministry) and onward to the Executive Council. In the meantime, he had thoroughly briefed both the Hon. Minister of Finance (Hon. Ralph T. O’Neal, now of blessed memory) and the then Financial Secretary (Allen Wheatley). It took three meetings of the Executive Council before the Financial Services Commission Bill received its approval to proceed for its First Reading in the Legislative Council (now the House of Assembly). The Bill received its Second and Third Readings and thus enacted by the Legislative Council on 7th December, 2001. Robert was present in the Legislative Council at each stage of the Readings of the Bill. I could see how very proud he was to see his arduous labour come to fruition, at least on the statutory front. My colleague legislators were very rightly complementary of his passion and commitment to the development of financial services in the Virgin Islands. Such was the confidence they had in Robert that not only did they pass the Financial Services Commission Act of 2001 with ease, they also felt confident that they were doing the right thing to enhance the development of the industry in the Virgin Islands each time a legislative measure touching on financial services was placed before them for enactment. The Financial Services Commission Act, 2001 received the formal assent of Governor Frank Savage, CMG, LVO, OBE, on 27th December, 2001. Just when I thought there was ample time for Robert to get on with the practical steps of establishing the Financial Services Commission; before I could ask him when the Act, 2001 should be brought into force, he indicated to me that he had already worked on all the details of establishing the Commission and was ready to launch immediately. I should have seen that coming. Robert is the realist that accepts that he lives in the present, but believes at the same time that he must always work in the future and ahead of time. He believed in being efficient and effective on the job. He’s results-oriented. He wouldn’t

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delay what needs to be done now to actualise a future event in a timely fashion. Robert wanted the Financial Services Commission Act, 2001 to be brought into force on 1st January, 2002. He had his plans for the new Commission and he didn’t want any delay. It was in that context that Statutory Instrument 2001 No. 51 was proclaimed by the Governor to officially bring the Financial Services Commission Act, 2001 into force on 1st January, 2002. The Statutory Instrument was gazetted on 31st December, 2001, barley 24 hours before the Financial Services Commission Act,2001 officially became operative. Robert as an individual in his own right, as a community participant and leader, and as a professional and public officer, has made many marks. The drafting, enactment and bringing into force of the Financial Services Commission Act, 2001, coupled with the establishment of the Financial Services Commission, will no doubt be counted as one of his greatest professional achievements. In the years since 2001, Robert insisted on regular reviews of the Financial Services Commission Act to keep it attuned to current and emerging developments relating to the proper, efficient and effective regulation and supervision of financial services business in the Virgin Islands. The Act had, since 2001, undergone numerous reviews and amendments to embrace new features and reform some of the existing ones – for example, the Enforcement Committee was established as one of the key governance structures of the Commission (in addition to the Licensing and Supervisory Committee), the Commission was given the power to issue public statements and appoint qualified persons to assist licensed entities, as well as issue practice directions and guidelines; the Financial Services Appeal Board was removed from the purview of the Act and established under a separate enactment independent of the Commission as a measure of ensuring greater transparency and good governance.

The enactment of the Financial Services Commission Act and the establishment of the Financial Services Commission, form part of his great legacy as a committed, passionate and an astute leader in the field of financial services, both at home and abroad. May that legacy live for eternity!

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services legislation, including the Banks and Trust Companies Act, the Company Management Act and the Securities and Investment Business Act, the need to deal with the increasing complexity and extra territorial reach of international regulations, as well as having to oversee an increasing number of regulated entities. Things became better, but the work never ceased. This article begins with a quote by LKY because, to my mind, there are profound parallels between the histories of Singapore and the British Virgin Islands, and the founding generation of politicians and Government officials in both jurisdictions that worked to create the conditions for economic success. To a great extent, it is founded on a fear of complacency and a willingness to work hard.

A VIEW FROM ABROAD By Kristian Wilson

ee Kuan Yew, the former prime minister of Singapore, popularly referred to as LKY, once observed that "what I fear is complacency. When things become better, people tend to want more for less

work."

As is well known, and discussed elsewhere in more detail in this special section of Business BVI, Dr. Robert Mathavious, OBE, has had a long and distinguished career in Government, including acting as Deputy Financial Secretary and then Financial Secretary From 1980 to 1991, Director of Financial Services from 1993 to 2001, leading the Financial Services Commission as its Managing Director and Chief Executive Officer from 2002 to 2020, as well as periods spent as Acting Governor in 2016 and 2017. This is certainly not a career based on complacency, nor a fear of hard work. In fact, aside from an illustrious career in public service, spanning over 40 years, Dr. Mathavious' career witnessed the birth of a new institution, the Financial Services Commission, the introduction of new and complex financial

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Both Singapore and the British Virgin Islands have a shared heritage. Singapore declared independence in 1965, and two years later, in 1967, the British Virgin Islands became fully autonomous and had its first general election under the new constitution. Both jurisdictions are islands, founded on a shared common law heritage, and had to find their place in a postcolonial world, with few natural resources or inherent industry, other than the talents of their people. Both jurisdictions found success based on increasing globalization and the free flow of people, goods, ideas and services, whether in terms of tourism or logistics, or in the provision of financial services based on the rule of law. Similarly, in the governmental arena, each jurisdiction is distinguished by the long political careers of its founding generation. For instance, LKY served as Singapore prime minister from 1959 to 1990 and the current prime minster, Lee Hsien Loong has served in the role since 2004, a period of time somewhat similar to Dr. Mathavious' tenure of the Financial Services Commission. Additionally, each jurisdiction has parallels in that the regulatory function is seen as central to good governance. It is notable that both the current Singaporean prime minister and deputy prime minister both served as chairman and member of the board of directors, respectively, of the Monetary Authority of Singapore ("MAS"), much as Dr. Mathavious' career has crossed between governance (including periods as Acting Governor) and regulation. This close relationship of governance and regulation, and the longevity of political careers in this arena, ensures continuity, stability, aligned values and consistency of vision. Of course, there are many differences between the two jurisdictions. Singapore has few regional competitors for the provision of financial services, given that it is located in a region notable for political instability and inconsistent approaches in the application of the rule of law, which allows Singapore to act as a safe legal harbour for the region. Additionally, as a fully independent country, Singapore has full autonomy over its political system and foreign relations and is only accountable to its own people. Singapore also has considerable power in

terms of its overseas asset holdings, the power of its state investment funds and its regional voice, and is based in a strategic area of the world, which allows it a certain amount of influence in relation to international bodies. Conversely, the BVI has a number of regional competitors for the provision of tourism and financial services, and is somewhat at the mercy of interference from or internal politics within the UK, as well as the regulatory designs of international organizations seeking to expand the market share of their members at the expense of smaller jurisdictions. In each respect, the BVI has little influence and lacks real leverage. As such, the BVI is in a much more difficult place, and cannot be complacent. The work must continue. There are also international headwinds that impact Singapore and the BVI similarly. The past few years has witnessed a retreat from globalization, and the free movement of people, goods and services, whether through the increased extra-territorial reach of regulation over an ever expanding array of activities, the increasing use of sanctions and trade barriers, the decline of international co-operation (notable examples including Brexit, or the collapse of the Trans-Pacific Partnership), and a growing global political populism which pitches nativism against perceived wealth or foreignness, all of which has been accentuated by the two year COVID-19 crisis, where borders have been closed against the free movement of people. Indeed, in Singapore, the past twelve months witnessed the exodus of close to 250,000 foreign workers, including the senior management of many international trust companies, banks, logistics and professional service firms, which has had a considerable impact on the local financial sector, revenue, local expenditure, and the atrophy of the international networks that connect people and ideas to the jurisdiction. In some ways, these structural changes have been well met from some sections of society, who are increasingly hostile to foreign talent, but in other ways, this may lead to significant economic issues. There has been a considerable 'brain drain' and many in the financial sector view Singapore as being closed to business and hostile to foreign workers. This local brain drain also, indirectly, has an impact to the BVI, as a number of losses in Singapore either had direct connections to the BVI, or a longstanding understanding of, and willingness to promote BVI structures, and it is submitted that where there are a fewer people overseas, with a relationship to the Territory, there are fewer members of the BVI's unofficial marketing team overseas. One concern, from the BVI perspective, is that any replacements in the financial sector may have unfamiliarity with BVI products, or at worse, a desire to market competing products with which they are more familiar or more invested. As such, what happens in Asia also affects the BVI, and with fewer BVI promoters and practitioners on the ground, it makes the fight for BVI market share more difficult. Clearly, there is much more work to do to counter these headwinds. It is not a time for complacency. Unfortunately, it is difficult for anyone to predict what work is required to ensure continued financial success, but in order to have a view of what might lie ahead for the BVI, it might be instructive to look at how Singapore is preparing its financial and legal industry for the future. Singapore has a reputation for being a centrally managed, planned, and

strategic state, but the reality is slightly more different. Singapore is often an experimental laboratory, which experiments with new ideas, and does have a considerable flexibility in approach. As LKY once said, "we are pragmatists. We don't stick to any ideology. Does it work? Let's try it, and if it does work, fine, let's continue it. If it doesn't work, toss it out. Let's try another one. We are not enamoured with any ideology."

BVI Soft Power

One source of insight into how Singapore is preparing for the future can be seen in the Alliances for Action ("AfAs") that were proposed by Emerging Stronger Taskforce (the "EST"), under the Future Economy Council, which was set up in May 2020 to identify systemic shifts arising from COVID-19 and recommend on how Singapore should refresh, reimagine or reset its economic strategies. The EST identified six key shifts accelerated by the pandemic, being: 1.

a more fragmented global order with growing tensions in technology, finance and trade;

2. the consolidation of industries, creating winners and losers amongst countries, companies and individuals; 3. the reconfiguration of global supply lines and production; 4. the acceleration of digital transformation and innovation; 5. changing consumer preferences, with greater demand for contactless services and alternatives to physical travel; and 6. an increased focus on sustainability due to the need for sustainable development.

“This article began by looking to the past, but ends by looking to the future, and it is clear that in both the past and the present, success frequently requires people of talent, such as Dr. Mathavious, who have not only spent their time in regulating the present and imagining the future, but have created both the institutions and the next generation of leaders who will do their part in working hard in the fight against complacency.”

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In response to the perceived challenges, the ES proposed the following nine AfAs: 1.

securing an economic future through supply chain digitalization;

2. building a 'Bright Green Spark' through sustainability; 3. digitalizing the built environment for tomorrow's cities; 4. bringing the state to the world through smart commerce; 5. breaking the productivity frontier through robotics solutions; 6. reconnecting with the world through safe and innovative visitor experiences; 7.

reaching the worlds learners through EduTech;

8. strengthening the state's position as an end-to-end hub for MedTech product development; and 9. building a world-class AgriTech ecosystem while supporting food resilience goals.

Clearly, not all concepts will be relevant for the BVI in terms of its position and industries, although it is clear that the focus on digitalization may have resonance for the tourism and financial services industries in the BVI. Additionally, the focus on sustainability and knowledge based futures are both areas in with the BVI can capitalize. Coming back to the key role of the regulator in nurturing economic growth, it would be instructive to look at the role of MAS In relation to financial services policy. In Singapore, MAS established the Financial Services Industry Transformation Map with the aim of creating a roadmap to be the leading Asian financial services centre. The key aims are: 1.

to become a leading international wealth management hub, to create a centre of excellence for wealth management technology and innovation, and deepen the talent pool to provide comprehensive, high-quality wealth advisory solutions;

2. to become an Asian hub for fund management and domiciliation, to anchor deeper asset management capabilities in the jurisdiction and promote Singapore as a regional fund domiciliation hub through its recent new vehicle, the Singapore Variable Capital Company ("VCC"); and 3. to ensure continued global forex discovery and liquidity in the Asian time zone, encouraging key forex players to anchor their matching and pricing engines in Singapore.

MAS assists the business sector by using various policies and support to encourage connectivity, facilitate and invest

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Success requires people of talent, such as Dr. Mathavious It’s not a time for complacency. in research and development, expand co-operation with other FinTEch sectors, harnessing technology to simplify financial institutions regulatory compliance, promoting the growth of a strong pipeline of specialized talent, or reskilling and redeploying local professionals into job growth areas. Aside from the general principles above, Singapore has used the legislative space to promote new vehicles and industries, as well as fostering certain areas of the economy through tax benefits or state backed funding and development support. Key areas of recent potential growth have been with the introduction of VCCs, which has been seen as a means to capture the funds space (particularly the Cayman funds market), and was introduced with significant support and input from the local Singaporean legal and accounting firms, and the introductions of new rules to promote the listing of special purpose acquisition vehicles ("SPACs") on the Singapore Exchange (and, despite an initial push to restrict SPACs to Singapore vehicles only, the decision was taken that it would promote the listing market to allow vehicles from other jurisdictions, so that BVI companies, among others, can be listed as SPACs). Additionally, Singapore uses various financial incentives to encourage the growth of the family office space in the local market, as well as supporting local fund and asset managers, has historically created a permissive environment for the FinTech industry, and has worked hard to make Singapore the regional hub for dispute resolution. Clearly, the BVI has not sat still in this arena, having instituted its own experiments with the creation of the Financial Services (Regulatory Sandbox) Regulations 2020 in order to test the FinTech space, and having created an array of innovative products designed to help young entrepreneurs or start up capital ventures, such as incubator and approved funds (which, notably, are not the type of funds targeted by Singapore's VCC product). Additionally, professional bodies such as the BVI Bar Association are also active in looking at legislation and promoting evolution in the FinTech space. Looking forward, it is clear that there are many economic headwinds, and the world is going through a period of great change, but that with change comes great opportunity, and the history of both Singapore and the BVI has shown the importance of the regulator and the role that men and women of talent and heritage have in nurturing and supporting a successful economy. In both Singapore and the BVI, the regulator doesn't just regulate companies, but regulates the health of the economy. This article began by looking to the past, but ends by looking to the future, and it is clear that in both the past and the present, success frequently requires people of talent, such as Dr. Mathavious, who have not only spent their time in regulating the present and imagining the future, but have created both the institutions and the next generation of leaders who will do their part in working hard in the fight against complacency.

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EASTERN PROMISES DR. MATHAVIOUS A KEY PROGENITOR OF SINO-BVI RELATIONS By Ellie Crespi

Over four days in mid-November last year, the British Virgin Islands financial services community and the wider community gathered to pay tribute to Dr. Robert Mathavious, OBE the man responsible for a leading and consequential role in building the BVI into an international finance centre, that now contributes more than 60% of the Territory’s annual budget and supports the livelihoods of so many residents and visiting professionals of the BVI. We counted among our esteemed guest speakers at the Global Currents Conference on day four, Mr. Eli Han, leading capital markets and structured finance partner from the New York office of China's largest law firm, King & Wood Mallesons. Mr. Han addressed delegates on the topic of the variable interest entity (VIE) structure, a topic that brings together the U.S. and China, through the use of the BVI, as a preferred jurisdiction for establishing affiliate entities to take advantage of this structure - the "BVI Advantage" as the financial services industry calls it. The choice of a speaker, representing the Asia-Pacific powerhouse was quite deliberate, for no celebration of the ascent of the BVI financial services sector to the place it now occupies on the world stage, would be complete without giving due consideration to China and its rise. This article reflects on some of the key milestones in the Sino-BVI partnership.

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he staggering ascent of China to a global economic superpower, can be fairly accurately traced back to the opening up and reformation of its economy in 1978. Around the same time, some eight and a half thousand miles away, on an island roughly ten miles long by two miles wide, occurred the inception of the International Business Companies Act 1984 (the IBC Act), the BVI legislation credited with transforming the Territory into the world's leading international finance centre. It is tempting to reflect, that the largest annual percentage increase in GDP in the half century since 1970 occurred in China in 1984, the very same year that the IBC Act passed into law. However, whilst the IBC Act might quite accurately be described as the darling of the BVI statute book – many have written of its significance in framing the fortunes of BVI financial services and 2019 even saw the inception of "BVI Financial Services Week", an annual financial services festival, conceived in honour of its 35 year anniversary - it would be a gross overstatement to credit the IBC Act with creating a global superpower. What we can say is that any correlation in fortune is the result of the BVI, steered in its policy-making and legislative reform by the vision of Dr. Mathavious, actively courting Greater China as a region with which it wanted to do business. The financial services sector posits various explanations for the explosion of BVI incorporations in the 1990s. Some credit it to the fall of Panamanian military leader Noriega, others to the functionality of the IBC Act itself, and some think the BVI just got lucky when Hong Kong billionaire Li Ka-Shing selected it as jurisdiction of choice for restructuring Hutchison Whampoa group. In all likelihood, the pre-millennium surge is probably a combination of all three factors, and this author will simply note the timeliness of Dr. Mathavious' appointment as Director of Financial Services in 1993. The international business company was eventually replaced by the BVI business company (BC) when the BVI Business Companies Act 2004 came into force

in 2007. The BC proved just as popular as its predecessor. Today, the BVI enjoys the lion's share of all global offshore incorporations (current estimates are around 50%) and the reasons for its popularity are well documented: gold-standard cooperation, with global calls to transparency and regulation; light but effective regulation; flexible, modern and highly codified corporate laws; strong rule of law; creditor-friendly enforcement procedures; tax and political neutrality; a deep bench of seasoned practitioners; efficiency of incorporation; low cost of use. The flexibility of the corporate regime, contemplates statutory merger and consolidation; corporate migration; the ability to give financial assistance; the ability to hold shares in treasury; schemes and plans of arrangement and company creditors' agreements – many of which concepts are not available in many onshore jurisdictions. Again, however, just like during the 1990s, the Far East has proven itself to be the biggest market for BVI financial services. The statistics are staggering. One of the most oft quoted is the BVI's spot as the second largest source of foreign direct investment (FDI) into China between 2006 and 2012 (trailing only Hong Kong). In 2012, the BVI contributed US$7.772 billion of FDI and it was the fifth largest recipient of China's considerable outward FDI. By 2017, 40 per cent of all BVI business companies were located in China and 75 per cent of Hong Kong's Hang Seng Index was made up of companies with direct linkages to the BVI. I was living in Hong Kong at the time and when I went to visit law firms, financial institutions and corporates to tell them about the BVI, I used to invite my audience to look out of the window and pick a skyscraper that wasn't owned by a BVI company. China's highest annual GDP growth since 1984 (and the inception of the IBC) was achieved in 2007 (the year of inception of the BC). It makes perfect sense that, having benefitted from Asia's equivalent of the "Warren Buffett Effect" back in the 90s, the fortunes of the BVI would track that of China, but it doesn’t really explain why the BVI remains so popular for new incorporations in the Far East, some four decades later. To unravel that, one needs to turn from events of the global stage and look to what the BVI has done to retain its competitive edge as China's leading investment partner. The BVI BCA envisaged that all BVI BCs could have a foreign character name. In 2012, amendment legislation was passed to provide the detailed framework to implement the concept, meaning that investors in China could incorporate BVI companies with Chinese character names for the first time. It was a relatively small legislative change, but it had a huge impact in a nation where the names are imbued with such deep cultural significance, that feng shui masters are routinely consulted by persons choosing them. In 2013, the Virgin Islands Government established BVI House Asia, with the objective of conducting diplomatic and business promotional activities in the interest of the BVI as a jurisdiction. The office is committed to expanding, strengthening and deepening the BVI’s footprint in Asia, with a focus on the Financial Services industry. Considered by many as an "economic embassy", BVI House

Asia has been staffed over the years by some of the finest minds in BVI financial services and has hosted regular delegations from the BVI, paying court to the Asia market.

BVI Soft Power

Indeed, when Hurricane Irma ravaged the BVI in 2017, BVI House Asia was one of the first respondents, working with BVI practitioners in Hong Kong to ensure "business as usual" could be delivered to the hungry Chinese market. I recall in the immediate aftermath – at a time when colleagues of mine were literally waiting for their loved ones to be reported safe – the BVI Registry managed remotely to incorporate a company. If a lack of empathy was perceived from China (and empathy was certainly not lacking), it was only because the BVI proved itself so remarkably resilient that to outsiders, the extent of the damage was impossible to imagine. It was perhaps the success of the pop-up court established in St. Lucia in the aftermath of the Storms, that enabled the BVI to adapt so easily to the challenges of displacement and remote working necessitated by the COVID-19 pandemic: it was not the first rodeo for our barristers and judges in court-by-zoom.

The last forty years have not just seen the rise of China and the BVI, but also the esteemed career of Dr. Robert Mathavious, who might rightly be credited as one of the key progenitors of the happy marriage between the BVI and China. Post-Storm, 2018 saw the Bank of Asia open for business in the BVI, and the popularity of the jurisdiction in Chinese structures has only continued since then: Mainland Chinese and Hong Kong-based companies now account for more than 40 per cent of the $1.5 trillion in assets mediated through the BVI, according to the VISTRA 2020 report The Disruption Advantage. BVI Finance recently commissioned a new report, which the industry widely expects to identify the same trends continue. When I moved to the BVI in early 2019, the first presentation I gave to the financial services sector focused on Sino-BVI relations: what I dubbed the "love affair" between the two nations. It strikes me now that the last forty years have not just seen the rise of China and the BVI, but also the esteemed career of Dr. Robert Mathavious, who might rightly be credited as one of the key progenitors of the happy marriage between the BVI and China.

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A SUCCESS STORY DR. ROBERT MATHAVIOUS AND THE BVI FUND INDUSTRY By Jerome Rubin-Delanchy

he British Virgin Islands (“BVI”), is not only this beautiful, untouched volcanic archipelago, well known for its sensational beaches and its world-class sailing, but is also known for being one of the most respected International Financial Centres (“IFC”). Ranked in the top 5 of the largest Offshore Financial Centres by the International Monetary Fund, the jurisdiction has become one of the leading platforms for collective investment vehicles, with close to 1,800 mutual funds registered, as reported by the BVI Financial Services Commission at the end of Q2 2021 . This success, which is undeniably the result of hard work, perseverance, and strong commitment, would not have been achieved without the exemplary vision of a person who has, for more than three decades, played a key role in getting the jurisdiction accepted by all international regulatory and standards-setting organisations. A task made all the more challenging, considering the constant growing pressure from the Organisation of Economic Co-operation and Development (“OECD”) and other international regulatory bodies. That person is none other than Dr. Robert Mathavious, OBE, the key figure who has been instrumental in promoting and maintaining the financial services’ integrity. He has spent many years fighting to ensure that the BVI has a seat at the decision making table, along with the “heavy hitters”. A prime example of this, being the instrumental role he played in the formation of the International Trade & Investment Organization, a grouping of small offshore jurisdictions which united to counteract the OECD’s misguided Harmful Tax Competition Initiative and in the commissioning of the hallmark “Towards a Level Playing Field”, a report jointly issued by the ITIO and STEP as a critique and response to the OECD report . In the 1990s and early 2000s, Dr. Mathavious, in his capacity as the Director of Financial Services at the Financial Services Department (“FSD”), was responsible for the development and regulation of the financial services sector, which includes the Investment Fund industry. The growth spurt of the BVI Investment Fund industry was in most part triggered by the Review of Financial Regulation in the Caribbean Overseas Territories, commissioned by the Foreign

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and Commonwealth Office (“FCO”) in 1999. At that time, the BVI counted 139 public funds and 1,545 non-public funds, split approximately equally between private and professional. While the Financial Services Department (“FSD”) already appeared to be a well-run regulator with a strong commitment to achieving international standards, several pitfalls came to light during the 1999 review; notably a lack of impartiality with a government responsible for licensing and enforcing action relating to financial service activity. A need for reforms to meet the International Organization of Securities Commission’s (“IOSCO”) standards was also emphasized. Shortly after the release of the 1999 report, Dr. Mathavious and his team set to work and created a task force to action the FCO’s recommendations and ensure that the BVI remained at the forefront of the industry. On 1st January 2002, under Dr. Mathavious’ lead, the BVI Government established the Financial Services Commission (“FSC”), a new autonomous regulatory body which over time has proven to be an essential contributor to the BVI’s growth into a modern, forward-looking IFC that has and continues to garner widespread international recognition. While the FSC’s primary function was initially designed for regulating and ensuring the supervision of the financial services market, it has also helped develop substantial relations with foreign regulatory authorities, international associations of regulatory authorities, and other regional and international organizations concerned with prudential regulation. Following this reorganization of the BVI financial services framework, the FSC task force undertook a comprehensive review of the rules and policies in place to achieve their next objective, integrating IOSCO – an organization that today regulates more than 95% of the world’s securities markets in over 130 jurisdictions. Dr. Mathavious’ hard work materialised at the IOSCO’s 32nd Annual Conference in 2007, when the BVI became the first country admitted to ordinary membership of IOSCO, based on changes made to its legislation. This adhesion marked a significant achievement for the BVI. As Dr. Mathavious stated shortly after this announcement, “being a member of IOSCO is a very important accomplishment that confirms the BVI as one of the premier and most effectively regulated offshore jurisdictions in the world.” From then on, Dr. Mathavious consistently implemented reforms to enhance the legal and regulatory framework and uphold the reputation of the BVI as a leading financial centre. He contributed to the dramatic evolution of the Mutual Fund landscape, leading to the BVI establishing itself over time, as a transparent and trustworthy driver for collective investment schemes. The year 2010 set another cornerstone in the continued development and growing sophistication of the financial services sector, with the enactment of the Securities and Investment Business Act, 2010 (“SIBA”). The objective of SIBA, was to update

and modernise the regulation of the BVI investment funds industry by repealing the Mutual Funds Act. Whilst the introduction of SIBA maintained the popular concepts which have underpinned the historic success of the BVI’s fund industry over the last decade, it has also facilitated the provision of greater transparency for investors and financial institutions investing into or lending to a BVI fund - hence further strengthening of the BVI’s fund offering. But, it is truly 2015 that marks one of the most exciting and key legislative developments for the BVI fund industry, with the introduction of the Securities and Investment Business (Incubator and Approved Funds) Regulations, 2015. The concept of this new regime reflected Dr. Mathavious’ awareness of global funds market trends and his commitment to ensuring that the BVI remains a leading, dynamic, and attractive domicile for investment funds, whilst maintaining best practices in international standards. Two new types of funds were born from this initiative, coming to complement the existing BVI funds offering: the “Incubator Fund” and the “Approved Fund”, both being lightly regulated fund vehicles, primarily aimed at attracting start-up, emerging managers, and those managing funds for smaller groups of closely connected investors. The BVI Approved Fund has been one of the most successful and popular BVI innovations in the last decade. At the end of 2016, just about a year after the Regulations came into play, there were 33 Approved Funds registered in the BVI. By the end of 2019, that number had already tripled and today, 229 Approved Funds have been registered in the BVI, with the number of launches growing constantly every year. The success of the Approved Fund mainly lies in the fact that it provides for a quick, innovative, flexible, and less upfront cost alternative to funds domiciled in other jurisdictions. The Approved Fund does not require an offering memorandum, a licensed investment manager, custodian, or auditor. Rather, investors must only be provided with a written description of the investment strategy and a written outline of the risks including, the risk of investing in an Approved Fund. This vehicle may have up to 20 investors with no restrictions in terms of minimum investment, provided that its net assets do not exceed US$100 million. Within the past four years, Approved Funds have satisfied a recognised need in the market for a lightly regulated investment vehicle to hold private family wealth, instead of the traditional BVI Company or closed-ended structure; the latter having a considerable drawback as an investor’s right to redeem shares is restricted. The main benefit of this simpler

fund structure, is that it provides a cost-efficient and swift option for a start-up manager, looking to establish track records with investments from either friends and family or small investments from third-party investors. In today’s climate, it is indeed no secret that new managers are facing more and more difficulties launching, with ever more complex international regulatory requirements and with investors’ demand for a certain scale and performance history.

BVI Soft Power

From an investor’s perspective, BVI companies have been commonly used by venture capital and private equity investors for acquisitions, joint ventures, and pre-IPO financings. Banks, lenders, and their counterparts are familiar with and therefore comfortable doing business with BVI companies. The Approved Fund provides an alternative vehicle to pool investments and attract joint venture projects and institutional investors. An approved fund is not a regulatory arbitrage, but an enhancement and draws on a BVI business company to make it a suitable solution for attracting new and existing business, tailored to suit the client’s needs.

“He has spent many years fighting to ensure that the BVI has a seat at the decision making table, along with the heavy hitters”. By developing a simple, quick, yet regulated additional framework, designed to insulate managers from the traditional regulatory challenges and attract more sophisticated investors, Dr. Mathavious demonstrated again, with the introduction of the Approved Fund regime, how important it is for the BVI to constantly remain on the cutting edge of the financial services markets, particularly in relation to fund business. More recently in 2019, playing his last pivotal role in charting the course of the development of the BVI financial services industry, Dr. Mathavious brought forward the Securities and Investment Business (Amendment) Act, 2019. This amendment, which came in response to the European Union’s (“EU’s”) pressure for IFCs to regulate closeended collective investment schemes, constitutes his last major achievement and contribution to the BVI funds industry. As a culmination of Dr. Mathavious’ legacy, on 18th February 2020, the EU announced that the BVI met all requirements of the EU tax good governance standards and was, therefore, “whitelisted”. The jurisdiction was deemed fully compliant in all respects. The whitelisting evidenced the BVI’s commitment to meeting the EU’s requirements in respect of good governance, anti-money laundering, and economic substance. This article speaks to the many changes and developments of the BVI’s product offerings over the last 30 years – the developments of which many can agree are attributed to the resilience and strength of Dr. Robert Mathavious, OBE. His forward-thinking approach has led the BVI to be a leader in financial services business and continues to ensure that the BVI remains a top IFC of choice, for companies and fund managers alike.

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BVI: THE SHINING BEACON OF IFCs IN ASIA

People like Ted Powell, whose fledgling company in Hong Kong Offshore Incorporations Limited (better known as "OIL") - changed the whole demand curve in Asia for offshore jurisdictions with the clever campaign of forming thousands of BVI shelf companies on the "luckiest day of the century" - August 8th, 1988. Hong Kong businesspeople flocked to buy companies incorporated on 8-8-88, as it surely promised good fortune for their new business ventures.

By Martin Crawford

And, up there on the pinnacle, Dr Robert A. Mathavious - the epitome of a smart, globally-aware regulator, who understood the need to balance the free-market desire for a corporate entity that was flexible and easy to maintain, with the need to comply with international regulations governing money laundering, taxation and good corporate governance.

This cocktail of excellent legislation, pragmatic regulation and an awakening of Asia as the largest market economy in the world, created the "home run" that is today's BVI. BVI has become the generic word for an entity established in an IFC. Clients here in Asia sometimes asked us "can I set up a BVI in the Seychelles?" confusing the concept with the jurisdiction.

he success of the BVI as an international financial centre at the summit of the global IFC community, can be traced back to a handful of people; those entrepreneurs who saw the market niche in the wake of the loss of the USA - BVI double tax treaty in 1984, Liberia's and Panama's fall from grace in the mid 1980’s and those enterprising politicians and regulators in Tortola who were keen to secure financial stability and employment for the BVI as a country.

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People like Michael Riegels, one of the architects of the International Business Company Act that created the BVI company, the blueprint of which was adopted and copied throughout the world.

Over the past 35 years or so since the establishment of the BVI IBC Act, Robert and his team weathered every international storm you

and the myriad rules and guidelines issued to facilitate international cooperation among international competent authorities. All of this has been done with a view of retaining the BVI's status as the benchmark for all IFCs.

BVI Soft Power

So, is it the end of the road for the love affair for the BVI with the Asian market? Will "Pandora Papers" be the straw that breaks the back where the "Panama Papers" and "Paradise Papers" failed to do the job? Or will it be the OECD's global minimum corporate tax rate proposal, now aimed at global MNCs, but likely to have the EUR750 million threshold inexorably creep downwards, that finally sees off the usage of BVI as the entity of choice for cross-border business in Asia? In the author's opinion, the answer to these questions is a resounding "no".

“BVI has become the generic word for an entity established in an IFC. Clients here in Asia sometimes asked us "can I set up a BVI in the Seychelles?" confusing the concept with the jurisdiction.”

could imagine. These attacks, sometimes direct, sometimes indirect, came from every quarter - IMF, OECD, FATF, EU plus many individual countries who took umbrage at the BVI's success. Through it all, Robert A. Mathavious was unflappable. While many IFC jurisdictions - in the Caribbean and further abroad - took the approach of pretending these attacks would go away, Robert met them head-on. He ensured that the BVI was always at the table, participating in peer reviews, task forces and international symposia, with the very people that were trying to marginalise the use and effectiveness of IFC entities in international business. The establishment of "BVI House" in both London and Hong Kong demonstrated to the world the BVI's resolve to state the facts to politicians and trans-national organisations, who were often misguided by lurid headlines from agenda-driven opponents of "sunny places for shady people". The BVI was clearly never in this camp. Quality has been at the forefront of the Financial Services Commission under Robert's leadership. Whether that is in the implementation of IT systems to assist the Registry, the quality of people the FSC has hired, the subsequent legislation enacted for Limited Partnerships, Funds, Trusts, Intellectual Property and the Banking and Insurance sector

As numerous studies and market research studies have shown, the rationale for Asian businesses and advisers using BVI as a corporate entity for IPOs, cross-border M&A activity and trade has nothing to do with taxation nor with ownership opacity. It is simply a better taxneutral vehicle to use than the domestic alternatives, which are often more time-consuming to set up and more onerous to maintain. And the numbers speak for themselves. The statistics published by the FSC show new incorporations of BVI companies in the second quarter of 2021 are firmly back at the 2018 levels and on-track to surpass the annual total for 2017. The legacy of Robert A. Mathavious, as the Captain of the good ship BVI for the last 18 years, on top of his 20 years as a civil servant in the Financial Services arena of the BVI Government is alive and well. As a representative of the corporate service provider community out here in Asia, and proud to have played a part in growing the prominence of the BVI as the "gold standard" jurisdiction, we gratefully salute Robert's great commitment and contribution to the industry. I am confident Robert's legacy will live on in the BVI Financial Services Commission under its new leadership. By maintaining a businessfriendly, pragmatic attitude, sticking to the mantra of "quality is everything", and being an active participant in the global regulatory environment, the future of the BVI as the shining beacon is indeed bright and is the gold standard to be followed.

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LEADERSHIP AND THE LEGACY OF ROBERT MATHAVIOUS By Martin Kenney

have known Dr. Robert Mathavious, OBE since 1998, when I first visited the BVI to speak at a conference on economic crime. I distinctly recall my first meeting with a man whose presence seemed to fill the space around him: he displayed the class of a Sidney Poitier, tempered with a deep warmth. His charm was disarming. BVI is not yet fully built as a ‘nation’, nor is likely to be so in short order. It has however achieved notable successes in Financial Services, which have catapulted its name globally; and is a critical part of the foundation on which BVIs’ growth and development have taken place over the past 30 years. I well-remember Robert confronting those complaining about the BVI as a “pirate’s cove” at an Offshore Alert conference in the early 2000s. He dismantled the naysayers with a deft combination of gravitas, a baritone voice and a deep sense of thoughtfulness in his rebuttal and defense of the honour of the Territory. He spoke eloquently of its work to provide financial services in an objectively safe and well-regulated environment, and in a manner that disarmed his opponents.

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Sadly, many people aspire to leadership for all the wrong reasons. But respect has to be earned, and the humble Dr. Mathavious has earned our respect in fistfuls. During his lengthy career as custodian of the financial services sector of our community, Robert has overseen many changes. His, has been a steady hand on the tiller, a sage source of advice and prominent leader as we navigated the shark-infested waters that have long surrounded offshore service-providing economies, such as ours. Over the years, Robert has been a model of stoicism in the face of constant sniping and criticism levelled by governments, transparency campaigners and journalists. To front up to these attacks takes courage. This tiny spec on the globe has been the mouse that roared in the face of battle, thanks in large measure to Robert. In fact, he has served our nation tirelessly for decades. The BVI owes him a great deal of debt, for far more than just his oversight of the Financial Services Commission (FSC). Robert has worked tirelessly on the volunteer front: for

“This tiny spec on the globe has been the mouse that roared in the face of battle, thanks in large measure to Robert.”

example, supporting the elderly and the Youth Boys Brigade. Following the devastation of Hurricane Irma in 2017, he was integral to the establishment of the Recovery and Development Agency. As we all know, this was no simple undertaking. We faced a disaster like few others, and to this day we are still rebuilding. But without Robert's leadership, we would be so much further away than we are today. Which brings me to another important observation. Some aspire to leadership for the wrong reason: to attain tyranical power over others, to bully. Self evidently, Robert Mathavious is the antithesis of this. In both good times and bad, he has reminded us that effective leadership requires the capacity to listen, to show courage, and to make decisions. In all these things, Robert has excelled. Whether through his work with young people, his ability to deal with situations without panic or bluster, or the support he demonstrated for the rest of his team. To complete his study in leadership, Robert could not have done as he did, absent far-reaching strategic insight and planning, and the facility to share his vision with team members to elicit their co-ownership. When called upon, Robert has been decisive, particularly when under fire. This is an important skill. Although it can be learned, a few, Robert included, are naturally blessed. When you are atop an organisation, everyone looks to you to make the right decision. These can have deep and far-reaching consequences. Robert has not abnegated his responsibility here. He has been ready to explain and defend his choices, bringing others with him as he has done so. This is a rare, and under-appreciated, quality. Surrounding yourself with good and competent people is a difficult task, too, but one that Robert has excelled at when at the FSC. It takes courage and trust to empower those around you and relinquish ownership of a task. This is governance at its best. Resilience is also a trait that grows with experience. Having a thick skin is key when facing the challenges that leadership brings. Taking ownership of problems instead of sidestepping them, inspires others too. Robert, again, has led by example here. His outward facade may appear laidback, but there is steel there for anyone who knows him: he does not suffer fools gladly. As part of my preparation to write this piece, I reached out to David Marchant of OffshoreAlert, in the hopes that he might have copies of some old presentations by Robert at OA conferences from almost 20 years ago now. David said: “Some regulators consider OffshoreAlert to be the enemy, which is bizarre given what we do and what they're supposed to be doing, but that was never the case with Robert and his team at the BVI FSC. I found him to be everything a good regulator should be, i.e. diligent, responsible, and responsive. He stood out from the

crowd in a positive sense and I routinely used to highlight this when giving presentations about the differences in international financial centres. He was undoubtedly an asset to the BVI. He took his job seriously, was good at it, and was generally a breath of fresh air.”

BVI Soft Power

The Order of the British Empire (OBE) is not awarded lightly. Nominees see their personal and professional credentials scrutinised; they need to be worthy of such an honour. It is awarded to individuals who have provided long-term, significant service to the community, or who have been responsible for significant community impact. Robert’s accolade is richly deserved, and as always, he has been humble in the face of this recognition.

“Some regulators consider OffshoreAlert to be the enemy, which is bizarre given what we do and what they're supposed to be doing, but that was never the case with Robert and his team at the BVI FSC. I found him to be everything a good regulator should be, i.e. diligent, responsible, and responsive. He stood out from the crowd in a positive sense and I routinely used to highlight this when giving presentations about the differences in international financial centres. He was undoubtedly an asset to the BVI. He took his job seriously, was good at it, and was generally a breath of fresh air.” One of my retired British police detectives told me, that a good senior officer would lead from the front, and that if they told you to run through a brick wall, you would not ask why – you would simply die trying. Robert Mathavious has led from the front, and he has had the respect of his troops. Robert has embodied all of these characteristics as a leader. He has also taken on board the imperative of encouraging, cajoling and inspiring young Belongers to enter a career as professional financial services regulators or enforcement officials. We have entered a time when many Belongers now occupy the upper echelons of the FSC. This will be his legacy.

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ACHIEVEMENT IN TIMES OF CHALLENGE By Jeffrey Kirk

r. Robert A. Mathavious retired as Managing Director and CEO of the BVI Financial Services Commission, at the end of 2020. A position he had held since January 2002. Such is the admiration and high regard in which Dr. Mathavious is held, both in the BVI and internationally, that many articles and reports have been written post his retirement about the man and his many achievements in an extraordinary career spanning many decades. What is less discussed is the context and environment through which he led the Commission, attained these achievements and fulfilled his role as chief architect of the BVI’s financial services sector. Dr. Mathavious’ career in the financial services industry spans over 35 years and has coincided with, and contributed to, the rise of the BVI as an international financial centre (IFC). The latter period of his career has also coincided with the first two decades of the 21st century, which have led to great strides in the development of the BVI as an IFC but simultaneously proven as economically tumultuous as the entire preceding century. One of the most important, if not the most important statutes in the BVI, the BVI Business Companies Act, 2004, was promulgated within Dr. Mathavious’ first two years as MD and CEO of the Commission. The BCA has directly contributed billions of dollars to the BVI fiscus. However, it has been far from easy sailing for the doctor. The last two

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decades have also witnessed multiple financial crises, one of which, the Global Financial Crisis (GFC) or the Great Recession as it is termed in the USA, impacted the entire global economy and its implications are felt to this day. Widely considered the worst global economic crisis since the Great Depression, essentially the GFC was created by major investment banks that over leveraged their clients and their own balance sheets, through proprietary trading, using mortgage-backed securities. The old investment adage ‘safe as houses’ was proven unfounded, when the returns on these securities, caused by an unsustainable asset bubble in the US housing market, which was predicated on rising home prices, fell into negative returns due to falling housing prices. This in turn led to defaults by bond issuers, starting in sub-prime mortgages, but spreading throughout the mortgage-backed securities market. The GFC started to be felt in 2007 and reached its zenith in September 2008, with the demise of Lehman Brothers. Other heavily impacted global investment and other banks included, but were certainly not limited to, Bear Sterns, Wachovia, AIG and the Royal Bank of Scotland. According to the World Bank, GDP across all countries declined in 2009 to -1.67% from 1.85% in 2008. The aftershocks continue to impact global banking, other financial services and the regulation of those sectors.

The doctor had a pivotal role to play in guiding the Commission and by further implication, the BVI economy, through this perilous GFC period, no doubt with particular focus on the BVI banks’ financial positions. As a result of these actions and interventions, the BVI improved its Global Financial Centres Index (GFCI 9) rating by two points in 2011. No easy feat. From a regulatory perspective, substantial progress was made by the Commission, led by Dr. Mathavious to the BVI’s regulatory and transparency regime following the GFC. The Regulatory Code was introduced in 2010, introducing an ambitious, broad and co-ordinated regulatory environment in the BVI. Similarly, the BVI’s anti-money laundering and combating financing of terrorism regimes, were enhanced by enacting the Anti-Money Laundering and Terrorist Financing Code of Practise 2008 and the 2009 amendment act and the 2010 amendment regulations, the Financing and Money Services Act 2009, the Proceeds of Criminal Conduct (Amendment) Act 2010 and the Securities and Investment Business Act 2010. These enactments resulted in the positive findings of the June 2010 follow-up report by the Caribbean Financial Action Task Force (CFATF) into the BVI. On a far more direct geographical threat basis, BVI financial industry firms and their clients have, over the past decade, increasingly become the target of cyber-criminals. The recent release of stolen or ‘leaked’ data under the ‘Pandora Papers’ is the latest in a line of such data breaches and theft of confidential client information, breaching common law and statutory data protections provisions. However, unquestionably the most damaging to the BVI of these data breaches struck in April 2016. The infamous ‘Panama Papers’. This disclosure of over 11.5 million documents emanating from the Panamanian law firm Mossack Fonseca, shook the BVI financial services sector to its core. The Commission, under the stewardship of Dr. Mathavious, imposed its largest ever fine on the law firm/trust company of $440,000 citing eight breaches of the BVI’s AntiMoney Laundering and Terrorist Financing Code. The investigation and fine against Mossack Fonseca evidenced the Commission’s commitment to regulating the financial industry in the BVI and to working with other international authorities to ensure transparency in the system. It was a testament to the Commission and the doctor’s conviction, dedication and willingness to conduct such a thorough investigation, whilst holding to account those who failed to comply with the territory’s structure, laws and regulations. An altogether different but more devastating challenge, was to face Dr. Mathavious, the Commission and the BVI and all of its people the following year. On Wednesday 6 September 2017 Hurricane Irma struck the territory. It was recorded as the most powerful Atlantic hurricane to make landfall. Irma was followed two weeks later by another category 5 storm, Hurricane Maria. These storms killed four people and caused widespread destruction, with estimated damages of approximately $4 billion. In the aftermath of the storms, it was clear that the BVI was facing a potential existential risk to the territory’s financial services sector. This could have resulted in the potential eradication of approximately 60% of the BVI’s total fiscus income, precisely at the time when the territory most needed funds to survive and rebuild. Fortuitously, the Commission, through its BVI Registry of Corporate

Affairs arm, had in 2006 introduced the Virtual Integrated Registry and Regulatory General Information Network (VIRRGIN). VIRRGIN is a state-of-the-art, electronic filing system. All incorporations and formation and post-incorporation/formation filings in the BVI are now generally made electronically, which leads to fast, efficient and accurate turnaround of documents by the corporate registry. It operates on a 24/7 electronic filing basis. VIRRGIN remains one of the leading, if not the leading, corporate and other forms of BVI entities, electronic registry platform in IFCs and possibly global financial centres.

BVI Soft Power

One of the most important, if not the most important statutes in the BVI, the BVI Business Companies Act, 2004, was promulgated within Dr. Mathavious’ first two years as MD and CEO of the Commission. The BCA has directly contributed billions of dollars to the BVI fiscus. Without this innovative and efficient electronic system for incorporating companies and administering corporate filings and records, it would simply not otherwise be feasible to effectively administer approximately 365,000 active companies and their related daily corporate filings. Using VIRRGIN, incorporations are affected within 48 hours. This demonstrates the BVI’s continued adaptability under Dr. Mathavious, to providing a world class, efficient and expedient service. Further, in early 2016, ‘VIRRGIN Lite’ was launched as a well needed and welcomed addition to the services offering and allowed users located in Hong Kong external access to the online registry system from outside the BVI. The VIRRGIN Lite system was used extensively in September 2017 following the storms and thereafter enabling the ongoing operations of BVI Inc., as an IFC. This capability, was crucial in allowing the territory’s financial services industry to recover and not lose clients. In the face of increasing international pressures for greater corporate transparency, the Commission, under the auspices of Dr. Mathavious, responded by again harnessing its technological capital to maintain compliance with international standards. In 2017, a new innovative technology platform, BOSSs (Beneficial Ownership Secure Search System), was unveiled to industry. BOSSs is

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the most advanced system of its kind, and through the use of sophisticated technology, is a searchable portal that marks a steep change in the way beneficial ownership information on any BVI company is stored, accessed and where appropriate shared, with competent authorities in the BVI and the United Kingdom. The BOSSs platform has recently been enhanced (BOSSs V2) as to enable Economic Substance (ES) filings to be made in respect of BVI business companies and relevant limited partnerships. ES requirements were introduced by the European Union (EU) from 2019 and continue to be required under the supervisor of the Organisation of Economic Development (OECD). The fact that the BVI already had the BOSSs platform in place, which could then be enhanced to meet the new ES filing requirement, has placed the BVI in the forefront of jurisdictions when it comes to ES reporting. It is extremely likely that the BOSS system will have to be adapted in the coming year to deal with and satisfy the pressure, demanding publicly accessible registers of beneficial ownership. These technological tools reflect the BVI’s, the Commission and Dr. Mathavious’ commitment to being an innovative, pioneering and forwardlooking jurisdiction. Both VIRRGIN and the BOSS v2 platforms continue to place the BVI on the cutting edge of financial services technology.

Failure to adapt and develop is a recipe for disaster. It is important that the BVI as an IFC and its industry members remember and apply that adage. We have been fortunate to have leaders in the financial services sector such as Dr. Mathavious that have adapted the Commission and the jurisdiction to meet the many challenges of the past two decades.

In the years following the 2017 hurricanes and leading up to his 2020 retirement, the challenges and achievements of the doctor have continued. We all remain in the midst of the COVID-19 global pandemic and whilst the situation is improving, infections and deaths continue. The pandemic has and continues to be a challenge like no other. As a counter-positive story to COVID-19, since 2017 the BVI has grown into a world-renown FinTech and digital assets jurisdiction, with numerous cryptoexchanges, token issuers and crypto funds being formed and domiciled within the BVI. This new and unique asset class has raised multiple challenges for the Commission, which has and continues to develop an appropriate regulatory system, including the FinTech regulatory sandbox environment.

‘Adapt-or-die’ is an old adage but applies equally in the modern era. Failure to adapt and develop is a recipe for disaster. It is important that the BVI as an IFC and its industry members remember and apply that adage. We have been fortunate to have leaders in the financial services sector such as Dr. Mathavious that have adapted the Commission and the jurisdiction to meet the many challenges of the past two decades. In the coming decades, the nature of the challenges will change, but there is no doubt that we will continue to experience them, which will face the next generation of financial services leaders and they must be ready. The next two immediate storms on the horizon are publicly accessible registers of beneficial ownership and the next Caribbean Financial Action Task Force (CFATF) review into the BVI. But meeting and dealing with challenges is not enough. The jurisdiction and the industry must also grow its offering. There are opportunities available to the BVI in the traditional sectors such as funds and insurance and also in the new sectors such as Blockchain and other FinTech. Thankfully, that next generation of financial services leaders has had the benefit of Dr. Mathavious’ guidance and they now stand ‘on the shoulders of giants’ in leading the BVI into the future.

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THE ASPIRING ARBITRATOR

BVI Soft Power

By Francois Lassalle

chievements and successes aren’t by accident. Advances often come through hard work and maintaining a mind-set open to new ideas and strategies. Challenging status-quo for the duration of an entire career is no easy feat and this is precisely why we are celebrating the life and work of Mr. Robert Mathavious. Throughout his life, Mr. Mathavious led paradigm changes in the BVI, across sectors and a wide spectrum of activities. We can applaud his performance, but most importantly, we should show our appreciation for his passion for change and progress, his forward thinking and long-term vision for a better BVI. There would be no better legacy than for others to follow his unambiguously successful track. By way of example, I would like to focus on how someone, with no real history or knowledge of arbitration, embraced an alien concept, framed it against the need for the BVI to bolster its premier international financial centre status and took decisive action to make it a reality. In August 2011, the Board of Commissioners of the Financial Services Commission (“the Commission”) of which Mr. Mathavious was an ex-officio member, took the decision for the Commission to explore the possibility of establishing the Virgin Islands as an International Centre for the Arbitration of Commercial Disputes. Mr. Mathavious led this initiative. In September 2011, after a careful review of a list of candidates, that could potentially assist with carrying forward the Board’s decision of the previous month, Mr. Robert Mathavious, took the decision to appoint Dr. Joseph S. Archibald, QC to head a Focus Group of seven experts of varied professional backgrounds, assisted by a resource person and a Secretary. The Focus Group had set terms of reference to review the Virgin Islands’ existing arbitration regime, with a view to modernising it and advising on how the Virgin Islands may be established “as a centre for international arbitration”. The Commission’s goal has been to introduce a new facet to the Territory’s financial services industry to cater for our clients and ensure that the Virgin Islands remains globally competitive. Mr. Mathavious remained a driving force behind the work of the Focus Group until the new arbitration legislation

came into force, the Arbitration Act, 2013. He also supported the efforts to get the New York Convention on the Recognition of Foreign Arbitral Awards 1958, extended to the Virgin Islands. Without such an extension, the relevance of the new Arbitration Act, 2013 would have been minimal, since arbitral awards made in the Virgin Islands would not be recognised outside the Territory. In conversations with Government, Mr. Mathavious drove the agenda forward and planned how best to successfully implement the new legislation. He designed and recommended a system whereby the newly created statutory body, the BVI International Arbitration Centre, would be incubated by the Commission. This approach and decision, enabled the smooth and successful implementation of the Act and empowered the BVI to grow as an arbitral jurisdiction. Mr. Mathavious further supported the establishment of the inaugural Board of the BVI IAC in 2015 and in 2016, was instrumental in hiring me as the first CEO. He went as far as traveling to London with a small delegation to converse and grill all the candidates in the final stages. Once the BVI IAC started its operations, Mr. Mathavious continued to be supportive, in his unmistakable subtle and nonchalant way. He would continue to ask the right questions at the right time, ensuring things move along smoothly. Without the silent leadership and steady determination of one Robert Anderson Mathavious, the BVI would not be the internationally recognised arbitration jurisdiction that it is today. Personally, I looked up to Mr. Mathavious as a business role model in the BVI. He is such a smooth operator and his dedicated service and commitment to the country were relentless. He demonstrated clear vision and dedicated his life to working for a better future for people. He impacted the lives of many, providing growth and work opportunities for thousands and the success of the BVI on the international scene is a direct result of his efforts and dedication.

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STAY THE COURSE: TOP TIER SERVICE AND SUSTAINABILITY

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Tourism and regained freedoms

he Global Wellness Institute has estimated that wellness tourism was a $639 billion market in 2017 and have projected that this will reach $919 billion by 2022. This sector captures those who are motivated to travel to maintain and improve their health and wellbeing. Wellness travellers are looking for a health boost, stress reduction, realignment of lifestyle habits and new experiences that will nourish, nurture and restore. As we all continue to face the challenges of a global pandemic, vacations and getaways will increasingly be driven by a desire to find restoration and regeneration.

The BVI by its very essence is a wellness destination. The clear seas, the blue skies, the stunning and soft landscapes of this unique archipelago naturally soothe the soul and restore the body and mind. BVI Tourism, be it private island luxury retreats, yachting, villa rentals, boutique resorts and mega/charter yachts all leverage from, and are inspired by, the exceptional beauty the islands offer. Across the islands there is a vast choice of spas offering an array of treatments, skilled and talented yoga instructors and more activities that you can fit into a two week stay. However, for those searching for a truly exceptional escape, there are a handful of retreats that are leading the way in the wellness space in the BVI and are offering unique and innovative experiences for those seeking a change of pace, a change of view and physical and mental rejuvenation.

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Luxury Wellness our T A

OF THE BVI

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St Bernard’s Hill House

Tortola

Privacy is the pinnacle of luxury. This is one of the BVI’s premier properties and it provides an unrivalled level of stillness and tranquility. Perched on the top of Tortola’s West End this private, eight-acre estate has a successful track record in the luxury villa rental space and discerning guests return year after year to enjoy its unique beauty. New owners acquired the property in 2021 and the guest experience has been elevated to align with their vision of holistic health and wellbeing. With a PhD in behavioral science, the new owners have spent the last twenty plus years researching how to create dynamic and inspiring environments to empower individuals to find and fulfil their potential. With family connections on Tortola, the owners are committed to everyone in their teams and all the support staff also enjoy the same high level of care. There are few property owners better positioned to create a world class retreat. There are five beautiful bedrooms, giving comfort to ten guests in total. All bedroom suites are outfitted with mini kitchens, walk in wardrobes and large private decks, which enjoy the panoramic views. The main house features the master suite as well as the grand living room, kitchen and interior and exterior dining rooms. Four additional bedrooms are in separate pods, affording great comfort and privacy. All are joined by winding

pathways and stunning landscaped gardens. There is a fully equipped and air-conditioned gym and swimming pool. There is over 15,000 Sq Ft of living and enjoyment space all with infinity views. There are some themed weeks, but the true joy of St Bernard’s Hill House, is that you can choose your own blend of contemplative pursuits and adventures. With the support of the estate manager and his team, you can curate your perfect escape. Do the things you love and the things you have always wanted to do. Enjoy solitude or the company of others. Be challenged or lounge with a good book and a frozen cocktail. The onsite team which includes chefs, stewards, a boat captain and fitness instructors will attend to all your needs discreetly and at your pace. The bespoke service will delight. www.stbernardshillhouse.com

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The Aerial BVI

Buck Island Buck Island is situated just off the southern shore of Tortola and has been privately owned for many years. However new owners have spent the recent years completely transforming this elusive estate and in early 2021, it opened its doors to guests for the first time. Known as The Aerial BVI, the ethos is very much about conscious awareness and having a positive impact on the world. This can be achieved through global initiatives, the group participates in many, but it is also about small acts of kindness and being gentle and compassionate to each other and the environment. The retreat embraces these values in full and there is a wonderful balance between pleasure, indulgence, mindfulness and calm. The island itself is 44 acres of tropical escape and accessible only by boat. It is a few moments ride from Tortola itself, so is very accessible whilst being secluded. On arrival,

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you are met by team members and will be transported to the main welcoming area by electric mini mokes, the soft pinks and sky blues of these vehicles will give hint of what is to come. The resort is comprised of five residences – Unity House, Faith House, Serenity House and the Love + Grace villas – and sleeps 30+ guests. All rooms at the Aerial BVI feature sea views, overlooking 14 surrounding islands, with stunning sunrise and sunset panoramas. The property has been harmoniously designed to blend in with its surroundings, allowing the natural environment, long range ocean views and vistas to speak for themselves. There are two stunning open air spa cottages under development and there is a beach gym for the determined. The stand out about this retreat is the commitment to transformation and this is integrated into their stays. The food and drink menus are innovative and enticing, but with clear parameters, no red meat is served, there are no sugars and mock-tails are offered (if you prefer something stronger you can absolutely have it). The ethos is about being and feeling well. Accommodating 30 guests in five residences, there’s big focus on sustainability, from the building materials used to the strict recycling programmes and kitchen gardens. Staff includes world-class nutritionist chefs, wellness consultants, spa therapists, water sports instructors, and garden and animal specialists, all welcoming guests to a range of cerebral and physical activities. www.aerialbvi.com

Tourism and regained freedoms

Baraka Point

Virgin Gorda Baraka Point, even the name sounds soothing. This beautiful villa has been quietly operating in the wellness space long before the terms became recognised. They are constantly upgrading and enhancing their offering but they consistently provide exceptional care of their guests. Sitting peacefully on a headland in the Caribbean Sea, flanked by Virgin Gorda’s trademark volcanic boulders and two pristine sandy beaches, Baraka Point Estate enjoys an unbeatable location. Fully staffed with a private chef and concierge services included, resort amenities, six suites and a separate main entertainment pavilion, Baraka Point is an ideal property for large families or groups of friends who wish to experience the BVI and return home feeling rejuvenated and inspired. Nestled in two acres of tropical gardens, the 12,000 Sq Ft villa's copper-peaked pavilions accommodate a total of 16 guests in five ocean view suites, plus a sixth principal master suite overlooking the beach. Designed to feel like a home away from home, the villa’s interiors are tastefully decorated with muted colours, kilims and hardwood furnishings, while exterior spaces look out over white coral stone terraces, emerald green lawns and azure seas.

Relaxation and a personalized service are hallmarks of the Baraka Point Experience. Leave the cooking to Baraka Point’s USAtrained chef, while you explore the three beaches within easy reach of the villa, snorkel the house reef teeming with tropical fish and hawksbill turtles or pamper yourself with spa treatments and a relaxing Ocean Wave Yoga session with Baraka Point’s in-house instructor. Cooled by trade breezes, the villa also has a well-equipped al fresco fitness area and complimentary membership of the Nail Bay Sports Club air-conditioned gym, tennis and squash courts just five minutes’ walk from Baraka Point. For guests who prefer to spend their time on the water, Baraka Point’s concierge can organise sailing, power-boating, fishing, kite-boarding, tubing, wake-boarding and more. Baraka Point also has paddle boards, life vests and snorkel sets and a beach buggy for guests’ use. However guests spend their time, they will find everything they need for a fun-filled, memorable stay in this exclusive beachside hideaway. www.barakapoint.com

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Saba Rock

North Sound Imagine being stranded out at sea on a rock. Then imagine fine dining, exquisite and elegant accommodation, a world class beauty treatment room and being caressed by the sounds of waves all around you. Welcome to the iconic Saba Rock! After a four-year renovation project this one of a kind resort has reopened, having undergone a complete transformation. The architect, Petr Kolar from the ADR Architectural studio, has introduced a modernity and a contemporary take on a beach feel that cannot be found anywhere else in the islands. There is a joyful mix of sandy bare feet and understated elegance. This exclusive resort has just seven hotel rooms and two suites. Spacious and well-appointed with lush furnishings, local artwork and stand alone baths make the rooms feel magical and with access to spacious exterior decks it is hard to imagine a more unique setting. Located in Virgin Gorda’s North Sound, with panoramic views that include nearby Prickly Pear and Eustatia you can enjoy a vast array of water sports and day trips to entertain. The onsite restaurant provides the perfect base to recharge and enjoy cocktails. What truly elevates Saba Rock as a destination of choice, is the introduction of the world class spa and treatment room. Spa and Sparkle is headed up by Leesa Jones, who discovered the Virgin

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Islands when working for the Virgin Group. Leesa ran spas in Majorca and South Africa, before heading to Necker Island and then settling on Virgin Gorda and establishing her own business. Leesa exudes professionalism and expertise and you know immediately that you are in the very best hands. The menu of treatments is more akin to a spa in London or New York with a Divine Escape Massage, a LED Phototherapy facial and Reili healing all readily available. Leesa has recently been joined by Danielle Walsh, who has worked in the wellness Industry for over 20 years and has a passion for holistic therapies. After a career working and mentoring in some of the leading spas around the world, Danielle developed her love of Yoga and is now an experienced and qualified Hatha Yoga instructor. As a Yoga instructor Dannielle seeks to bring her experience and knowledge of the body into the studio to further enhance and deepen the yoga students experience. Together with Leesa, they have put Saba Rock on the global spa map. Although only a one-acre estate, the experiences you will enjoy elevate the Saba Rock Resort to a truly best in class wellness destination. www.sabarock.com

Tourism and regained freedoms

Oil Nut Bay

Virgin Gorda Oil Nut Bay is an idyllic island resort, located on the eastern tip of Virgin Gorda in the coveted North Sound region of the British Virgin Islands. The resort is spread across 400 exquisite acres and entirely surrounded by the turquoise waters of the Caribbean Sea on one side and the Atlantic Ocean on the other. The low-density resort features just under 120 home sites set within eight unique neighborhoods that each celebrate the island’s diverse topography and expansive sea views. Only accessible by water Oil Nut Bay has the exclusivity of a private island and the luxury homes and villas here are of cutting edge designs. These exquisite homes are available, for purchase and for vacation rental and with the amenities available this is a retreat at its finest. Whilst the offering here is not packaged as a wellness escape, the attention to detail, the dining, the water sports, the hiking, tennis courts, the equestrian centre and the facilities make it just that. This is a jewel, which ever way you cut it and if you are seeking restoration, you will leave Oil Nut Bay with full batteries and then some.

When staying in a state of the art villa with views to die for, you may not ask for much more. However you are spoilt for choice here. The Beach Club has three dazzling pools, a waterfall, swim-up bar, cabanas, lounge areas and world-class dining. The Pavilion is Oil Nut Bay’s intimate dinner venue, which features a variety of food from around the globe, including selections from the Far East, Mediterranean and the local grill. Don’t miss the carefully curated wine list and Rum Bible boasting 52 different rums, all from the Caribbean and immediate neighbours. The Pavilion also includes a beautiful bar, private dining room and meeting space, fire pit, hot tub and pool table. Oil Nut Bay’s invilla spa treatments feature only the highest-level organic extracts and herbs to ensure superior quality and exquisite textures. The wellness studio is furnished with a full range of cardiovascular equipment, treadmills, Pilates reformer machines, elliptical cross trainers and free weights, as well as a variety of Wellness Classes from Pilates to yoga, the wellness studio inspires a renewed dedication to a healthy lifestyle. Upcoming expansion plans include a day spa, water sports deck, art gallery and additional retail. This retreat will revive and restore for sure! www.oilnutbay.com | BB

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Are we losing our advantage as a dominant player in the global yachting space? by Andrew Ball

“If you want to go fast, go alone. If you want to go far, go together.” The British Virgin Islands Marine Sector is indeed unique. To refer to us as “The Sailing Capital of the World” is probably a little too non-specific. There are a number of sailing havens globally, all of different types. To refer to us as the “Charter Capital” or “Bareboat Capital” of the world would probably be more accurate. The yachting aspect of our Marine Sector is the main driver and it is increasingly under threat following advances in competitive behaviour in other regional and global destinations. This have been further exacerbated by the set back resulting from the 2017 hurricanes and now the COVID-19 pandemic. The BVI as a destination has every God given asset we need to succeed, once we work together and row in the same direction. The sector has been left to run somewhat feral over the years, mainly due to the fact that only a few fully understand the interrelationship between its internal sub-sectors, inward investment, the local community, and the public sector. Ask yourself: “what truly new product has the yachting industry in the British Virgin Islands been able to produce in the last decade?” We have grown in quantity, but I would argue that we are not realising our potential in terms of quality. As a small destination, quality is critical to our survival. My intent here is really to give a bit of window into the drivers behind the yachting economy in the BVI, as well as some of the challenges and remedies in order help the sector heal and return to a sustainable longterm path of growth. I want to break down some of the walls that have grown between us.

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“The industry is exclusive of local investment. None of the charter boats in the VI are owned by BVIslanders.” Almost no charter companies own their yachts. Shocking to some, but true. Almost every yacht has an individual private owner. This no different to fractional ownership in many global resort brands. There are two main reasons that people buy yachts and put them into charter. The first is to offset the cost of personal use. This allows them to buy a bigger better boat than they could ordinarily afford. The second, increasingly popular reason is quite complicated, but in short, US owners can claim back the value of the vessel as a tax deduction. Buy a boat, or pay taxes… tough choice! One that fuels a significant part of our tourism plant. What nearly nobody is crazy enough to do, is to buy a cruising yacht to make money. Many have tried and only a very few have succeeded. Find a friend who has a boat and they’ll tell you things like “Boat is an acronym for Bring Out Another Thousand”, or “The only better thing than owning a boat is having a friend that owns a boat”. Boat ownership is indeed a crime of passion. It’s not that the investment is exclusive, it’s that it generally doesn’t work unless someone wants to offset the

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usage of a yacht, which of course they could also just charter for a lot less. There are indeed a good number of BVIslanders invested in the area of the sector that does make profit and drives the economy locally – services. Be it in maintenance, fiberglassers, painters, riggers, marinas, provisioners, taxi drivers, ferry operators, sailmakers, welders, boatyards, supermarkets, owners of marinas …the list goes on… there is a significant portion of local ownership and employment. Of course, that could always be more!

Tourism and regained freedoms

“The yachting industry pollutes our environment.” Very few industries have a positive or completely neutral impact on the environment. The yachting industry is heavily motivated to be one, however. Most operators realise that the environment is exactly what we are really selling, and that they subsequently need to preserve it. People charter yachts in order to be in our natural environment. Over the years, numerous advancements have been made, and implemented, in terms of renewable energy on board charter yachts (beyond their sails!), environmentally friendly antifouling paints and cleaning products, waste recycling programs for yachts and sewage management programs. On the note of sewage, because everyone brings it up, and importantly so; The BVI would need an estimated 70 pumpout stations which were all connected to public sewerage system, capable

of treating and disposing of saltwaterbased waste (unlike your house, which is freshwater-based). The logistical problems due to our landscape and facilities make this near impossible economically. There are international conventions which govern the disposal of treated waste offshore, which the industry strives to meet. Rest assured that the very people accused of dumping in anchorages are the same people who swim in those anchorages – what do you think their motivations are? There was an effort, years ago, to create an infrastructure to collect waste, using boats and dispose of it ethically offshore. Investment was provided, but due to various regulatory issues, red tape and delays, the plan never came to fruition. This is just one of many examples where there is a substantial opportunity for local entrepreneurship and economic growth if the Government has the foresight to encourage and incentivise it.

“We have lots of yachts in the BVI, so the industry must be doing well.” This is a tough one. As mentioned previously, the real economy that this industry provides in the BVI is through services. If we have lots of boats sitting in marinas and boatyards doing nothing, we do indeed have lots of boats, but they aren’t utilising the services which contribute to the local economy. The metric we should be looking at, is how many yachts are out sailing and occupying our anchorages. Working boats mean a working yachting economy which means a vibrant tourism sector for a lot of the BVI. The yachting sector is perhaps the leading sub-sector of our economy from an income distribution standpoint. A number of our Sister Islands would have very little economic activity, without the yachting sector.

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“The industry is exclusive of local employment.” From my perspective, this couldn’t be further from the truth. The challenges of obtaining work permits, alone, are a significant motivator towards hiring a local workforce. The industry has invested heavily in assisting to design and support the Marine Professional Training Programme at HLSCC, provides internships for the work placement segment of this course, and hires a good number of the graduates from the program. Most of the professionals I know (including myself ) found their passion at a young age, and It’s important that these opportunities are provided. A team has been working diligently towards restarting the Kids and the Sea (KATS) programme, which is very exciting. The Royal BVI Yacht Club provides a youth sailing program. Can these opportunities be better? Yes. Are we striving to make them better? YES! My point is that the industry is still after two generations of its existence, mostly misunderstood, and that’s not hard to sympathise with. It’s incredibly complex and unique. Some of the players have historically not been the best corporate citizens that they could have been. Regardless, we need to start listening to the people who understand, or we risk falling seriously further behind our competition. Over the years, we have seen an increasing percentage of our market share moving to other jurisdictions and have acted with arrogance and complacency. We need to take steps that have mutual benefit for the industry, the community, the environment, and the local economy. It is time for a Yachtsmen Friendly Strategy 2.0. The first was implemented and led by the late Chief Minister H.L. Stoutt in 1992. The first step I would suggest towards getting on the right track, is a true, sincere, public-private partnership. The industry and the Government need to work together in earnest to deliver course corrections to steer us towards a quality over quantity model, which protects the environment and maintains the “Nature’s Little Secrets” exclusivity of our marine tourism industry. This effort was indeed made by the Marine Association, in the form of a Letter of Intent presented to the Government in May 2021. It detailed an agreement towards communication and collaboration, which could be demonstrated through a prospectus of education, employment, environmental, and economic programs funded by the industry. That agreement has not been signed by Government and is still pending at the time of writing. It is important for both the industry and the community, that a stronger partnership exists to encourage both; better corporate citizenry on behalf of the industry, and better efforts to ensure a business-friendly environment on behalf of the public sector. We need to recognise our differences, address them, and move forward.

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The second step is really to examine how we attract foreign investment in the BVI. This falls mostly in the public sector’s purview. As mentioned before, near 100% of our charter boats are foreign-owned, and with good reason. We need to ensure that those foreign owners continue to put their yachts in the BVI. As with many other industries, excessive red tape, inconsistent regulation, and lengthy processes are making it increasingly difficult to encourage this investment, while other jurisdictions continue to better their competing products. Much like many concepts within the Yachtsman Friendly program of the early 90s, it’s time to streamline our processes and realign ourselves with our market. Getting this right requires the aforementioned partnership. Know your audience. Creating barriers to foreign entities operating within the BVI is not the answer. They still utilise our services and contribute to our economy. Encouraging them to consider basing here is the answer. It is about maximising the benefits to our local economy. Let’s not forget that yachts are not like buildings, they are mobile, and subsequently, the existing foreign investment in our infrastructure is and has been, very easy to relocate should investors feel that their assets may be more profitable elsewhere. We are unique, but that does not mean that other products in the space are without differing competitive advantages. The third step that I feel is most missing, is to endeavour to provide new products and experiences. This falls mostly in the private sector’s purview. Revitalise and promote our historical sites. Promote themed charters that reach new markets (yoga/wellness, corporate retreats, weddings, you name it). Provide new and improved supporting services. Expand our existing facilities and services to support small mega yachts (in the spirit of later serving larger ones). We must innovate. If we want to be the global leader in this industry, we need to show the market how and why. We need newer and more shiny products than our competitors, and the sky is the limit. This is a perfect area for local entrepreneurs to take advantage and be creative. There are plenty of entities willing to invest given the right conditions.

The industry and the Government need to work together in earnest to deliver course corrections to steer us towards a quality over quantity model, which protects the environment and maintains the “Nature’s Little Secrets” exclusivity of our marine tourism industry. The super and mega yacht market is relatively unexplored in the BVI. Yes, we have visiting super and mega yachts, but the services we can provide to them are limited. This is often linked to the lack of infrastructure to support those services and attract enough super yachts to meet a minimum demand to support a business. Here we are leaving revenue on the table. It seems that most folks are thinking only about having it all at once. There is no reason we can’t move from supporting 80’ yachts to supporting 100’ yachts and then a few years later expand to 120’ yachts, etc. This will be a gradual progression, but while we continue to dawdle, competing jurisdictions are serving this market and fortifying their grasp on it, to our disadvantage. Have a look at the facilities in St Maarten, Antigua, or St Thomas. The time is now. Let’s start to look at feasible ways to break into this market, develop our services and infrastructure, and subsequently expand the related economy before we are properly left behind with little chance of catching up. There are people with the knowledge and resources to do this, but communication and collaboration have again been our downfall, and subsequently these people have either walked away from the table or avoided approaching it in the first place. The bottom line is that I honestly believe that we were the best in the world at this game. We are still one of the best, but is that good enough for us? We had a little stumble, but there is absolutely no reason that we can’t come back bigger, stronger, and better than we were before if we work together, so let’s get started. This is a low hanging fruit for a yachting destination with our pedigree and DNA. “If you want to go fast, go alone. If you want to go far, go together.” | BB

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Business BVI sits down with David V. Johnson for an update on Oil Nut Bay The pandemic has been and accelerator for Oil Nut Bay, given that people globally are not waiting to purchase their dream home. In mid November, Business BVI caught up with the resort developer and chairman of Victor International Corporation David V. Johnson, for his insight on how ONB is responding to global changes in leisure travel driven by the pandemic. Here is his take.

How has the pandemic changed or is changing travel overall and specifically in the luxury segment? Oil Nut Bay is the perfect destination, because travellers are going to a single destination versus multiple vacation spots. A single destination makes travellers feel safe and offers quality time with their families and loved ones, where great leisure activities are available, reliable internet and a variety of villa sizes to accommodate all guests. The accelerator for Oil Nut Bay was the pandemic. People are not waiting to purchase their dream home. They realise time is precious and are acting at an earlier life stage than ever before. Also, in each neighbourhood, as we get down to two or three remaining lots, they do not want to miss out and therefore purchasing where they can build within the 5 years.

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What changes have ONB made in anticipation of, or in response to those changes? Oil Nut Bay’s master plan did not need to be changed. The original vision is perfect, which is 12 distinct neighbourhoods all of individual villas with different sizes and locations, whether Beach Villas or Wildside Villas. Today’s reality is that Oil Nut Bay has individual privacy and an opportunity for connection from world class amenities and state of the art infrastructure, including highest quality internet. The company mandated the vaccine for all employees and contractors to provide a safe environment. We partnered with NetJets to provide guests with the very best private air travel and have invested in multiple spec homes in our Marina Villa and Ocean Villa neighbourhoods. We are selling homes and lots virtually to both new buyers and existing owners who have purchased while building their new home. We have built an entire Marina Village, seven homes, a spa, boutique retail and our restaurant Nova, which is open to the public, all during the pandemic.

Tourism and regained freedoms

Social distancing has become a defining feature of the pandemic. Needless to say ONB was presciently designed with social distancing in mind with key elements such as 117 home sites on 400 acres, (200 designated green spaces) access to unlimited crystal-clear turquoise waters and a focus on families. Were you able to use these strengths in enticing new buyers? Yes, we are experiencing tremendous sales success in all areas. We have sold two Boulder sites, two Atlantic Ridge sites, two Estate Lots, a Peninsula Lot, four Marina Villas, an Ocean Villa and two re-sales. We have a variety of choices to meet all needs and the variety demonstrates the wisdom of the master plan.

Did you have existing owners who rejoiced that they had a home at ONB to retreat to once the pandemic took hold in 2020? Our homeowners are proud to be part of Oil Nut Bay and recognise the huge investment that we have done to maintain the quality of our team, as normally there is virtually no unemployment in the British Virgin Islands. Together, with our owners and through our North Sound Foundation, we have continued to provide extensive financial support to the greater community. We continue to help build local schools and social programs on Virgin Gorda which is highly respected by all.

Do you have some pandemic related takeaway lessons that the BVI as a destination must consider adding to its branding and marketing? The BVI has a 10 month season of 8082 degrees because of the natural air conditioning of the ocean which makes it very attractive, not only as a winter destination but a summer destination as well. We have seen major interest from places like Texas and Arizona where it is well over 100 degrees. In our marketing strategy, we are using the power of video and zoom calls to connect virtually and have sold properties with this technology. These virtual demonstrations and tours have become standard and we will continue to invest in cutting edge technology.

What key decision must the BVI take today, to ensure it regains and retains its global leadership position in the luxury space post the pandemic? The 6500 foot expansion of the International Airport runway is critical and a strategic necessity. This will facilitate direct flights from New York, Charlotte, Atlanta and Miami on Delta, American and Jet Blue airlines. The estimated completion of this expansion is set for November 2025 and will posit-on the BVI as the go to Caribbean destination, with longterm significant returns for the territory.

The global demand for super yachts is red hot, spurred along by the pandemic. How does reentering the super yacht space help to enhance the BVI share of voice in marketing the destination globally? Do you have a suggested timeframe for the BVI Government in making this a reality? We are very excited about working in cooperation to bring superyachts back. Oil Nut Bay is ready to receive them.

ONB recently agreed two very strategic partnerships, one with the Corcoran Group and the other with Net Jets. What was your thinking and objective in entering those partnerships? We are absolutely thrilled to be partnered with Corcoran BVI as their first international franchise. It gives Oil Nut Bay global exposure and most importantly it is a strategic effort to maximise resale value for our owners. We are proud to have just been awarded Robb Report’s Best of the Best New Island Community 2021. NetJet member base perfectly aligns with our potential homeowner community and resort clientele. After 10 years of steadily building and completing all infrastructure and social elements it is now time to tell the world about Oil Nut Bay.

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Notwithstanding that it is early in the life of these partnerships, are they meeting your initial expectations? Absolutely, we are thrilled with both partnerships. The outstanding leadership of Pam Liebman, CEO of Corcoran, and her entire organization have exceeded our expectations. Corcoran is part of Realogy, which is the world’s largest real estate company and who also owns Coldwell Banker, Sotheby’s and Century 21 real estate companies. This has expanded and allowed us to have an incomparable network of global agents. NetJets has proven to be a truly reciprocal relationship. Our guests and homeowners can capitalise on their best-in-class offering and their members can enjoy an augmented VIP Oil Nut Bay experience. We are very excited about our future together!

How are bookings trending for the winter season 2021/22? This Christmas/New Year season has more than doubled the 2019 Christmas/New Year season. We continue to add more finished villas and look forward to welcoming more new people to Oil Nut Bay.

What’s keeping you up at nights at the moment? Continuing to build the perfect Oil Nut Bay team is what keeps me up at night. We have added to our already phenomenal team a Watersports Director, new Sushi and Executive Chefs and many more exciting positions which enables us to deliver on a world class level and perpetuates the success of Oil Nut Bay. We are also exploring new building techniques to keep costs competitive and deliver value to our existing and future owners. Oil Nut Bay has 200+ construction workers on site every day and where there is a gap in commissioned construction, we fill it with spec homes so there is predictable work. It is that type of synergy I think about.

What are you most excited about with regards to Oil Nut Bay? We had one neighbourhood sell out this past year, the Boulders. Because of that, we opened up 19 lots on Pajero’s Point that are the absolute best in the Caribbean. I have been waiting to introduce these to the world and am very excited about it. In fact, my wife, Pam, and I, are in the process of designing our forever home in this new neighbourhood. ONB has reached this tipping point of growth where we now have a minimal number of lots left in every neighbourhood, including the Peninsula, which has the best ocean/beach lots in the world. People are realizing they must purchase now, or the property will be gone. Thankfully, the BVI allows 5 years to build so purchasers can take their time to really consider what they want in their new home. In the beginning, I had to sell hard my vision and dream. People are now coming and realizing the importance of the momentum and have a sense of urgency to act more than ever before. | BB

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The British Virgin Islands: My very familiar, foreign - home

The Expert

by Sarah E. Harrigan

Mervin Hastings of Eco Adventures BVI is exactly that, a formally trained ecoscientist. He grew up in the Brewer’s Bay area of Tortola with his great uncle and grandmother, with whom he’d drink Black Wattle bush tea (a local plant from the spice pepper family, that’s good for curing respiratory diseases such as the cold and flu) every morning,

One thing my worldly adventures have taught me is that, with the right guide, you can rediscover, reimagine and redefine anything and to relearn the BVI, I needed an expert.

Mervin spent most of his life outside, and if he wasn’t out learning the local plants with his grandma, he was climbing the nearby ghut on his family’s land, where he caught crayfish, snacked on hog plums and almonds and collected calabash casings that were later turned into dining bowls. It is these childhood experiences, plus the knowledge and familiarity of the landscape, that make the eight unique tours offered by Eco Adventures BVI, soo exhilarating.

What You Will Learn For our day out, we embarked on the Signature Brewers Bay Ghut Tour. Immediately, we learned why Brewer’s Bay is home to five Sugar Plantations, with both 18th and 19th Century machinery. We then got a brief history on how the BVI women smuggled rum over to St. Thomas, our USVI neighbour, in their pantalettes, and that the BVI was almost a french speaking country.

ven though I was raised until the age of 12 in these beautiful, rich green islands, I noticed very early into the Eco Adventure tour that I may have to revoke my own Belongership. The truth - I knew the world more than I knew my home, and this was my first lesson back. After four years in Mayer, Arizona at boarding school, five months in Hong Kong for a unique marketing and finance internship, four years at the Pennsylvania State University for a BSc in Economics, and eight plus years in New York City making waves in corporate and startup finance, it was time to re-establish my island roots. Thanks to the COVID-19 pandemic and the inability to travel beyond the borders, there was plenty of time to dive right into the lush fauna, deep blue seas and resilient people of the BVI; and in the bush with Mervin Hastings, was the best place to start.

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Then, what started out as a historical tour, quickly became an adventure like no other, similar to going into the wilderness in Jurassic Park. We climbed huge boulders, walked through streams, had a conversation with a jovial Pineapple farmer who almost convinced us to exchange manual labour for the sweet fruits he grew, and ended up on an old school water reserve that resembled what we today call a cistern. On each of his tours, Mr. Hastings passionately covers a variety of subjects in such detail, that his guests can write a book, teach a class, heal themselves of any ailments, or like me, get seriously reacquainted with home, by the time it’s over. In under three hours, we covered the following topics: History: Slavery, Fights For Ownership Of The BVI, Sugar Plantation Brewing, Folk Tales. Fauna: Learn How To Live Off The Land: Cooking, Cleaning & Healing Purposes. Insects: Learn The Scientific name of Insects and their role in the EcoSystem. Marine Life: Learn About The Underwater Life Coral and fish

Tourism and regained freedoms

Mervin’s twenty five + years of experience as a trained Marine Biologist and self proclaimed science geek make his guided tours the best yet, enhanced by cold fruits and fresh lemonade served in calabash bowls. While he’s formally trained in the sciences and can point out different types of lizards, millipedes and horned trees, it’s his eloquence, enthusiasm and expert knowledge that makes for a truly holistic experience. Things to look forward to: Monkey No Climb Tree, Mervin’s Cousin Mike on the Pineapple Farm, local fruit snacks: Lizard Food, Passion Fruit, Pineapple, Almonds, Hog Plums and Guineps.

I highly recommend following up your hike with a clear bottom kayak tour of the nearby Brewer’s Bay Beach for views of beautiful coral, fish and views of the island from the sea. If you’re planning your first visit or you’ve been coming to the British Virgin Islands for years, or better, if you’re a local like me, who thought you knew everything there was to know about your BVI, you deserve a different nature lover’s perspective. This experience goes beyond the beach bars, and exotic days at sea; instead, it creates an awareness and appreciation for the Caribbean beyond the normal. A tour with Eco Adventures BVI will confirm what we know at the core, that we’re meant to coexist with nature, learn from it and heal through it. With anything in life, as much as you think you know, you must leave room for and be guided by your curiosity, a chance to learn more, and an opportunity to redefine what you already know. Exploring nature is exploring you. | BB

The Experience The Signature Brewer’s Bay Tour Time: Approximately 3 Hours Climate: Sub Tropical Rainforest Location: Starts at Community Centre Parking Lot Cost: $20 Adults | $10 Children 6 - 10 Level of Difficulty: Medium Bonus: Eco Adventures BVI has partnered with Yolo Adventures BVI for a land and sea tour combination

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Water's Edge Villa | Virgin Gorda

THE PROPERTY SPOTLIGHT, YOUR MOVE

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Real Estate

THE OUTLOOK FOR REAL ESTATE EDWARD CHILDS Celebrations for New Year 2021 were meant to herald a new dawn as the COVID-19 vaccination programme was being rolled out and we could finally look forward to life returning to “normal”. Some twelve months later, and while great strides have indeed been made, we can hardly state that normality has returned. The debate on whether vaccinations should be mandatory and the impact of the relaxation of restrictions on those who are not vaccinated, have dominated political discourse both here and internationally. On the world stage, the outgoing Trump presidency a year ago saw the storming of the U.S. Capitol building in Washington D.C., an event which shook the foundations of democracy in the United States, while the announcement of a Commission of Inquiry here in the BVI on January 18, 2021 by the then outgoing Governor, similarly sent shock waves through the local community. But as we end a urbulent 2021, there are positives to report in the real estate market and the tourist sector is again hoping for a strong season as tourist arrivals are poised to ramp up.

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COVID-19 RESPONSE AND VACCINATION PROGRAMME ROLL-OUT

n a year when the BVI has been in the spotlight for other reasons, it will be the Government’s handling of the pandemic which will demonstrate how effective they have been both in controlling the spread of the virus and re-opening of the economy to much needed tourism. It must be remembered that the BVI was still in the process of recovery from the 2017 Hurricane Irma which devastated much of the housing and infrastructure in the BVI when the pandemic shut down the economy for a second time in less than four years. Apart from a spike in cases in the BVI in late June and July when very sadly thirty-seven residents died from COVID-19 (added to the one person who died in 2020), COVID cases in the BVI have

generally stayed under control. For many months in 2020 and at the start of 2021, residents could enjoy a relatively relaxed lifestyle within the bounds of the established protocols, with tourists returning to the BVI at the end of 2020, albeit in small numbers. Graph 1 shows the rate of COVID-19 infections in the BVI during 2021, reflecting the June/July spike when the Delta variant arrived in the BVI and spread rapidly through the population. Fortunately, a quickly imposed curfew and a responsive population, combined with an effective vaccination programme, brought the spike under control by late August, and by October, active cases were back down to low numbers.

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GRAPH 1: BVI COVID-19 CASES 2021

The BVI rolled out its vaccination programme in early 2021, with the first of the AstraZeneca shots being administered in mid-February. Despite Government’s best efforts, including a successful drive-in programme offered around the BVI, the total number of administered vaccinations tapered off from mid-summer with a total of 17,005 persons being fully vaccinated by 23 December 2021 (Graph 2). According to official statistics, this represents 56.2% of the population being fully vaccinated with 18,432 having received their first dose bringing the total to 61.0% of the population by 23 December 2021. In the summer of 2021, the Government also arranged for anyone in the BVI to travel to the USVI to receive the Pfizer vaccination as some remained skeptical about possible side effects of the AstraZeneca vaccine. It should be noted, however, that the official Government population statistics are based on the 2010 population census with a total population of 28,054. Since then, many people have left the BVI following the impacts of Hurricane Irma and there have been further repatriations of workers following the slowdown in the economy as a result of the pandemic. The Government’s current population estimate, with no new census having taken place in 2020, is 30,253.

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20,000

15,000

10,000

As of 23 December 2021, a total of 35,437 vaccine doses have been administered.

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0 Jun 20

Fully vaccinated 17,005 56.2% of population

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Aug 21

At least 1 dose 18,432 61.0% of population

GRAPH 2: BVI VACCINATIONS MAY TO 23 DECEMBER 2021

Sep 21

Vaccination goal 22,500

Oct 22

Nov 22

Extra protection goal 24,000

Dec 23

Real Estate

The Government’s aim is to reach “herd immunity” with 75% of the population being vaccinated which requires a further 6,000 people to be fully vaccinated, with a target of 80% of the population being vaccinated to be effective against variants (Graph 1). Given the lack of progress in increasing the number of persons being vaccinated since the summer, it seems that the BVI will remain at between 55% and 65% of the population being fully vaccinated unless additional factors come in to play. It is expected that boosters will be provided for vulnerable persons and people from mid December. Despite the number of persons being vaccinated levelling off, the BVI is ahead of the independent Caribbean Islands who are struggling to vaccinate their populations as shown in Graph 3. The British Overseas Territory of Cayman Islands has exceeded 80% of the population being fully vaccinated and Turks & Caicos Islands is at 69% while Anguilla is over 60%, demonstrating how the support for vaccinations from the UK has helped the vaccination programmes in these Territories. The Government has to steer a fine line between keeping the economy running, encouraging tourism to return to the BVI and protecting those who remain determined not to be vaccinated. The question of whether to mandate vaccinations on all, or some, sectors of the population have not yet had to be addressed in the BVI. Attempts to do this in other countries have been met with opposition and hostility.

Partial dose

Full dose

Cayman Islands

87%

Turks and Caicos

74%

Anguilla

65%

Saint Maarten (Dutch)

62%

Antigua and Barbuda

62%

British Virgin Islands

60%

Barbados

53%

Saint Kitts and Nevis

50%

Trinidad and Tobago

45%

Dominica

40%

Bahamas

38%

Grenada

35%

Montserrat

31%

Saint Lucia

29%

St. Vincent and the Grenadines

26%

Jamaica

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GRAPH 3: CARIBBEAN VACCINATION RATES AT 22 NOVEMBER

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ECONOMY AND TOURISM

s 2021 rolls to an end, the climate crisis is once again front page, ahead of the pandemic that took centre stage in 2020. With the Global Climate Change Summit (COP26) in Glasgow concluded, the world’s nations are under the spotlight to finally implement strategies to reduce carbon emissions. Focus is also on inequality, not just in relation to the impact of climate change on poorer nations, but also on how the vaccine rollout programme has been first world centric. At the G20 summit preceding COP26, agreement was reached on setting a minimum corporation tax rate of 15%, a move to prevent multi-nationals from diverting profits through low tax jurisdictions. Preceded by the Paris Agreement in 2015, which targeted keeping temperatures to 1.5°C above pre-industrial levels, and well within 2°C, and reaching “net zero” greenhouse gas emissions between 2050 and 2100, COP26 has reset targets. In the end, COP26 ended with an “agreement to agree” with nations meeting again next year to pledge to deeper emissions cuts. The summit was overshadowed by China and India watering down language on the phasing out of coal to “phasing down” much to the dismay of many smaller nations already impacted by climate change. Poorer nations are holding the wealthier nations to account, both in terms of meeting their commitment to the Paris Agreement and in particular to Climate Financing, whereby the wealthier nations pledge $100bn annually to support developing nations meet their climate goals. Scientists are in no doubt that the stakes are high with current pledges, if fulfilled, limiting temperature rises to around 2.4°C, still well above the intended target of 1.5°C. Aside from the medical impacts of COVID-19, the extended lockdowns experienced throughout all economies have played havoc with supply chains, the demand for labour and Government debt as stimulus packages have increased Government borrowing to levels not seen since the Second World War. As economies reopened, there has been increased labour demand as firms seek to ramp up supply of goods however, supply chain issues have impacted economies around the world, in turn leading to increasing prices and the return of inflation which reached 5.2% in the US in September. With poor third quarter growth in the US, as the drag of increased COVID cases caused by the Delta variant took hold, combined with a slow-down in vaccinations, the higher than expected inflation has sent ripple effects through the US economy and beyond. While most economists believe that the 3rd quarter slow-down is temporary, the US Federal Reserve has abandoned its view of the increase in inflation being transitory and has strongly indicated its willingness to speed up the taper in 2022 by increasing interest rates to counter the impact of inflation. The emergence of the new Omicron variant in early December could change the response if economies are once again shut down through new quarantine requirements and restrictions on travel resulting in slower ecumenic growth. Concerns about inflation, reduced economic stimulus and supply chain woes have dampened stock markets that had experienced significant growth earlier in the year and the announcement of the Omicron mutation led to market jitters at the end of

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November indicating the continued impact of the pandemic on the economy. Fund managers are cautious about prospects, with inflationary risks the main area of concern, leading to de-risking of investment portfolios. However, more fund managers are taking stock of changing trends regarding ESG (environmental, social and governance) concerns as investors take heed of messages from scientists and activists on climate change and equality, and Governments on regulation. Following a strong projected fourth quarter, the US economic outlook for 2022 is for a slow-down in growth while inflation rates remain uncertain. The question of how the Federal Reserve will respond to inflation, either through raising interest rates or further stimulus of the economy, will determine how the economy responds. The fragile balance of power in the Senate stalled President’s Biden’s plans for his infrastructure bill, although it was finally passed in a reduced format in early November, he arrived at COP26 without his climate change plan approved. The recent avoidance of a government shutdown indicates the delicate balance of power that is being played out in the US. The election for the governorship in Virginia resulted in a shock win for the Republicans, indicating the lack of popularity of the Biden administration (a rating of just 43% by early November) and reflecting how the passage of Biden’s agenda had become mired in political wrangling combined with the chaotic withdrawal from Afghanistan in the summer. Interestingly, the newly elected Republican challenger in Virginia managed to appeal to the Trump base as well as moderate Democrats, without inviting the support of Trump during campaigning. How the US economy performs in 2022, the confidence in equity markets and the general outlook of investors will play a significant part in determining the economic outlook in the BVI and the wider Caribbean. The BVI’s twin pillars, financial services and tourism, have both suffered impacts in recent years which have in turn impacted funding for central government. Financial services have come under pressure internationally, particularly after the 2008 financial crisis. The regular leak of information from “offshore” financial jurisdictions (Panama Papers 2016; Paradise Papers 2017 and Pandora Papers 2021) has provided fuel to the fire to impose good governance and transparency on jurisdictions involved in financial services. The UK has been pressing for the imposition of public registers in the BVI (and other jurisdictions), a move the BVI has said it is willing to commit to by 2023 provided all jurisdictions have the same requirements as the BVI. In announcing the decision to move to public registers in October 2020, Premier Fahie stated "The format must be in line with international standards and best practices as they develop globally and, at least, as implemented by EU member states. In advancing this commitment, we will be informed at all times by global best practice at the time within a timeframe that we consider deliverable."

Real Estate

Water’s Edge sits above a boulder field on the shore of Crooks Bay and offers impressive views of the Caribbean Sea. The villa itself is nestled among the large granite boulders with many incorporated into the design of the home.

ANNUAL COMPANY FORMATIONS

80,000

The foundation of financial services in the BVI remain the formation of companies which has experienced a decline in recent years. Graph 4 shows the 12-month moving average for company formations from 2012 which demonstrates the general downward trend, as does the total registrations shown in Graph 5 which has fallen by 116,383 registered companies between Q1 2013 and Q2 2021, a fall of 24% over the period.

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GRAPH 4: BVI COMPANY FORMATIONS 12 MONTH MOVING AVERAGE THROUGH Q2 2021 500,000

475,000

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400,000

375,000

The significant declines in company formations in 2019 and 2020, following modest increases in 2017 and 2018, is concerning for the industry and more particularly for Government where 60% of revenues are derived from the financial service sector. Revenues from the sector fell by approximately US$30M, or 3% of GDP, in 2019 with a similar fall in revenue in 2020, accounting for 52.68% of total revenues in 2020 compared to 59.31% in 2018. This placed the BVI in a deficit in 2020 of approximately $30M with revenues totalling approximately $360M against expenditures of $390M. On 11 November 2021, the Government announced their 2022 budget of $397.17M with the Ministry of Finance predicting revenues of $356.7M of which $323.2M will be derived from taxes and $33.5M from other sources. It is not yet clear how the budget shortfall will be addressed.

350,000

2012

2014

2016

2018

2020

GRAPH 5: BVI COMPANY FORMATIONS TOTAL REGISTRATIONS THROUGH Q2 2021

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There is some light on the horizon as both Q1 and Q2 2021 showed significant increases in company formations compared to 2019 and 2020. Chart 1, prepared by the Financial Services Commission, shows company formations by quarter between 2017 and 2021, with the first six months of 2021 indicating that the half year formations were similar to 2017.

40,000 Q1

8,916

30,000 8,538

9,575 20,000

5,596

7,639

6,108 6,975 9,126

7,621

6,254 9,114

6,365

10,000

4,725 9,798

8,695

7,732

7,214

5,275

0 2017

2018

2019

2020

2021

CHART 1: QUARTERLY COMPANY FORMATIONS 2017 TO Q2 2021

While the performance of the financial services sector is a longterm concern, the impact of first Hurricane Irma and then the pandemic on the tourism sector, the second pillar of the economy, has also been significant, both in terms of impact on government revenues and, as importantly, the businesses and employees offering services in the tourism sector. Graph 6 shows the impact of these events on tourist arrivals to the BVI, both overnight and cruiseship passengers. Prior to Irma, overnight tourists, which include hotel, villa and yacht charter guests, averaged around 400,000 arrivals each year, with 50% of those arrivals from the yachting industry. Following Hurricane Irma, the yachting industry sustained tourism in the BVI for many months before the hotels and villas were repaired and reopened again to visitors. The pandemic impacted hotel/villa and yachting industries alike and businesses have struggled to remain solvent through the now nearly two years that the pandemic has impacted the BVI.

750,000

Overnight visitors Cruiseship passengers

Border Closure

375,000

Hurricane Irma

ANNUAL VISITORS

562,500

187,500

2017

2018

2019

2020

GRAPH 6: ANNUAL OVERNIGHT AND CRUISESHIP VISITORS 2017 - 2021 (12 MONTH MOVING AVERAGE)

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2021

Prior to the pandemic, in 2016, cruiseship arrivals had increased to 700,000 plus arrivals a year, mainly as a result of the upgrading of the cruiseship dock and the addition of the new Pier Park to accept the larger cruiseships which by then made up the majority of the cruiseship fleet. Cruiseship arrivals then halted for a better part of a year after Hurricane Irma while the cruiseship companies waited for the islands to be ready to accept their passengers back. This was in contrast with the many overnight visitors from hotels, villas and charter yachts, who were keen to return to the BVI as soon as it was safe and practical to do so in order to support the economy, even though the BVI was still in the process of rebuilding. The winter of 2019/20 was the first high season following Irma to see visitors return to the BVI in larger numbers as more hotels and villas reopened. The yacht charter industry had also rebuilt the charter fleets and were likewise expecting a good season as was the cruiseship sector. All this optimism was cut short in late March 2020 when the pandemic lockdown was announced, and tourism was halted over-night.

Real Estate

Valley Trunk | Virgin Gorda

The government established strict travel protocols during 2020 for nationals and residents returning to the BVI, although it was some time before work permit holders were permitted to return to the BVI. An online travel gateway was established towards the end of 2020 as the tourism sector became anxious to see tourists return to the BVI, with tourists being permitted to return on 1 December 2020. The application process and quarantine requirements on arrival evolved over the course of 2021, particularly as persons became double vaccinated. Eventually, with effect from 1 October 2021, all persons who were double vaccinated were permitted to enter without having to complete the gateway application but with the proviso of taking a rapid flow test on arrival. While hotels, villas and yacht charter companies are reporting strong bookings for the high season as travel restrictions ease and more people are double vaccinated, there have been issues for many companies in preparing for more guests, particularly with delays in re-employing labour that had previously been severed. The yacht charter industry has also had turbulent times as the

Shipping Registry and BVI Customs Department are now enforcing regulations just before high season that were first enacted over twenty years ago. The regulations call for all commercial vessels in the BVI to conform to certain regulations with the Shipping Registry giving the various charter companies about two weeks to comply, which involves also having each boat surveyed. While the charter industry is not opposing the enforcement of regulations, the timing and lack of notice has created issues for previously booked charters resulting in many of the foreign owned vessels and high-end crewed charter vessels relocating away from the BVI. Regulations are also impacting mega yachts and foreign owned vessels that have scheduled visits to the BVI during the season due to an increase in documentation required in order to carry out charters, resulting in some cancellations.

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DEVELOPMENT IN THE BVI

our years following Hurricane Irma, two of the BVI’s iconic watering holes in North Sound, Saba Rock and Bitter End Yacht Club, have been rebuilt and are re-opening for business which will provide a tremendous boost for tourism in North Sound which has otherwise lacked a diversity of bars and restaurants to attract tourists. Saba Rock, sold following Hurricane Irma, was completely rebuilt and reopened for business on 16 October. Sitting between North Sound and Eustatia Sound, Saba Rock Resort provides a classic bar and restaurant location for waterborne guests along with nine guest rooms and suites. While similar to the resort that existed prior to Irma, the redesigned property incorporates significant structural changes both in terms of upgrades to cope with future climate events, and also with the interior design and layout. Bitter End Yacht Club has an established global following in the yachting fraternity, created over the many decades that the resort has been operating. After the original resort was levelled by Hurricane Irma, the owners started plans for phase one of what they referred to as “BEYC 2.0” with a nautical village offering a range of facilities including The Clubhouse, with a multi-concept seaside restaurant and beach bar, the Bitter End Market and Reeftique plus two self-catering marina lofts, with more to follow in further phases. Centred around a village plaza, the development has echoes of the past, with the Quarterdeck building and generous use of timber throughout, but draws on modern design and contemporary finishes to complete a modern waterfront mixeduse complex. BEYC 2.0 re-opened in December.

Oil Nut Bay has now been under development for twelve years, establishing itself as one of the leading residential resorts with over $600M of owner investment to date. In addition to the established central facilities, which include Beach Club, fitness centre, tennis and pickleball courts, nature centre, kids’ Nut House and two heli-pads, recent development has also focused on the marina village which includes a 93-berth marina plus the over-water Nova restaurant with accompanying retail and leisure outlets including a day-spa which is due to open in 2022. With around $100M in new construction each year, there are now fifty villas completed or under construction with four new villas introduced into the rental programme this year and a further six villas being added over the next year. Guest experiences at the Beach Club now include the Pavilion, an exclusive area where homeowners and in-house guests can curate the menu and enjoy the private hot tub and fire-pit. The Marina Villas, comprising two, three and four bedroom rental ready units, will be completed in 2022 and developer, David V. Johnson, recently announced the release of newly available homesites on Pajeros Point, the most easterly point in the BVI. Lots at The Peninsula and Wild Side range in price from $3.95M to $25M for the 10.79 acre Point Estate. The development is also about to commence building their zero set-back Ocean Villas, two three-bedroom spec homes and a six-bedroom villa situated on a white sand beach. Oil Nut Bay continues to be a major source of employment and revenue for the BVI and will also provide business opportunities for construction and further development for many years to come.

Valley Trunk | Virgin Gorda

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Real Estate

Valley Trunk | Virgin Gorda

Scrub Island is an established resort with a residential component which is enhancing its green credentials. A solar array, capable of providing over 50% of the resort’s power, has been installed within the past year and a chef’s garden created to improve sustainability through the provision of their own herbs and seasonal produce. Landscaping throughout the resort has been enhanced to balance the built environment with nature using indigenous plants and natural materials. Scrub Island will be completing two new villas in 2022, each offering three-bedroom suites and spacious living areas with the first due for completion in January. Scrub Island have also announced that they will be taking over the operation of the adjacent Marina Cay, having signed a long-term lease with the owner towards the end of 2021. This iconic island, for many years home to a Pussers outlet, is one of the key stop overs for yachts cruising around the BVI. With thirty moorings available, Scrub Island intend to bring back the island’s nostalgic past, once again providing visitors with an anchorage and landside facilities. Nanny Cay Resort and Marina announced the opening of their Seaview Wing of new hotel rooms at the end of October 2021 which are due to open to guests from 1 December. Comprising Superior rooms on the first and second levels and Premium rooms on the third level, each room offers 400 sq ft of interior space with a balcony overlooking the Sir Francis Drake Channel. The hotel at Nanny Cay also has 34 existing rooms in the garden wings with the standard rooms on level one being refurbished while the deluxe rooms on the upper level have been completely rebuilt. Once the

Seaview Wing is completed, the hotel will have a total of 52 keys in addition to two and three bedroom town houses which are also offered for rent through the hotel. Nanny Cay has also been addressing the operation of the marina, focusing on the availability of slips to over-night renters and charter companies to maximize the number of guests who will be utilizing the facilities at Nanny Cay. With Navigare and Waypoint yacht charter companies both commencing operations at the marina this high season, Nanny Cay will be catering to many more guests than in prior years, particularly with the charter companies predicting a busy season. To this end, Nanny Cay have reorganized some of their guest services and will be introducing “Omar’s’” to the Nanny Cay food and beverage options while the Spa will relocate to a larger unit providing improved services to guests. On Tortola, there are a number of significant commercial development projects underway which are being developed by BVIslanders. One Mart is expanding its operation in East End with the construction of a new 12,000 sq ft store, and more planned elsewhere on Tortola. JOMA Properties, one of the leading locally owned property development companies in the BVI, have launched their Road Harbour Marina project, a mixed used development which is planned to include a 65-room boutique hotel in addition to commercial and residential space plus the revamping of the existing marina services. In Road Town, the six storey 26,000 sq ft Lunar Tower occupying a prime location on Waterfront Drive, is due for completion in Q1 2022, offering prime office space and retail units.

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INVESTMENT ACT AND BUSINESS LICENSE ACT

he majority of the resort development in the BVI in recent years has been focused on the expansion of existing facilities with just a small number of greenfield sites being developed. Scrub Island, Oil Nut Bay and YCCS Yacht Club and Marina are three examples of new developments and Moskito Island is essentially a ground up re-development of an older resort. This is unusual in the Caribbean where most islands have benefitted from new development over the years. Development starts during 2021 in many islands have signalled a revival of the resort sector since the economic crisis in 2008 ended the last development boom between 2004 to 2007. That the BVI has not seen many new build developments is due to a complex number of reasons with indirect air access through regional hubs often being mentioned as a prime reason for the lack of development in the BVI. However, many developers and investors will also point to the difficulties associated with investing in the BVI, with delays in approval processes increasing the development risk compared to other islands. The Government is introducing two new acts in an attempt to address many of the concerns expressed by investors with investing in the BVI. The Virgin Islands Investment Act 2021 was passed in August and replaces the Pioneer Services and Enterprises Act, the Hotel Aid Act and the Encouragement of Industries Act. The Business Licensing Act, which replaces the Business, Professions and Trade Licences Act, is currently passing through the House of Assembly and has received its first reading. By introducing these two acts, the Government is aiming to enhance development on the BVI through both domestic and international investment, while at the same time introducing legislation which makes it harder for foreign entities to front their ownership of a business through a local (Belonger) entity. Central to both acts is the introduction of the Virgin Islands Trade Commission which has been established under the Virgin Islands Trade Commissions Act. The Commission will be tasked with considering investment proposals and approving investment plans as well as promoting investment in the BVI. It will also maintain a register of both domestic and international investors and their investments which exceed a certain (as yet undefined) threshold. The same Trade Commission will also be responsible for reviewing and approving applications for business licences under the Business Licensing Act. The two acts introduce some fundamental changes to the process of investing in the BVI, particularly for foreign investors. The principal difference is that prior to applying for a business licence, a foreign investor first has to apply for, and be granted, a certificate of approval under the Investment Act. The application will be considered against a range of criteria which include the contribution the proposed investment will make to the BVI with respect to employment and training of the workforce, the procurement of goods and services domestically and the impact on the environment. Additional considerations apply for foreign investment, including the creation of a joint venture with a Belonger, employment of Belongers, the transfer of technology, skills and management expertise and the promotion of

research, development and innovation.

The Investment Act includes the ability for the Minister to facilitate the granting of visas and resident permits to foreign

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investors, their immediate families and foreign personnel including either the approval for the long-term engagement of foreign personnel or the temporary engagement for a prescribed period. The Act reserves certain sectors of the economy (yet to be defined) for Belongers or entities which are majority owned by Belongers and foreign investors may be required to enter into a performance agreement with the Commission which in turn will establish a client service facility to facilitate the application and approval processes for required permits and licenses. The Act also establishes the National Economic Investment Fund which investors with qualifying investments will be required to contribute to. The fund will be used for infrastructure development, environmental protection, development and social programmes. The Act does not specify when a contribution shall be made or the amount of the contribution. The schedule to the Investment Act outlines the types of investment incentives available, projects eligible for investment incentives and areas for investment incentives. The Act does not set out in detail how these will be administered, except that regulations will be established to give effect to the provisions of the Act. The Investment Act provides two schemes for foreign investors. The first, the Invest and Stay incentive, is not described in detail except that the minimum investment to qualify for this scheme is $5.0M and that 60% of all employees should be Belongers. The Invest and Stay incentive offers investors a two year entry permit that can be extended for further periods of two years while the investor owns the business. The second scheme is the residency by investment scheme. This scheme is administered by a Residence by Investment Unit which reports to a Residence by Investment committee. Applicants for this scheme have to apply through an approved agent, who has to be a Belonger. Details for this scheme have yet to be developed, including what level of investment is required. An approved investor is not permitted to apply for Belongership until after a period of twenty years has lapsed since the date of application for residency. The Investment Act gives the Commission rights of expropriation, subject to the payment of compensation, which includes “an asset, a property right or any other right of an investor….”provided the expropriation is “taken in the public interest”. A foreign investor can transfer funds for the investment into and out of the Territory, subject to the laws of the Territory, but “the Minister, on the advice of the Commission, may delay or prevent a transfer …..” in certain prescribed circumstances such as insolvency, to protect creditors or to ensure compliance with judgements or tax obligations. The Act also states that “in exceptional circumstances, to prevent movements of capital that causes or threatens to cause serious difficulties for macroeconomic management of the economy.” A foreign investor is required to pay the initial capital required (not defined in the Act) for the investment before the Commission “shall issue a certificate of approval of investment that allows the foreign investor to register with the Commission and commence with the investment.” However, it is only once the certificate of approval has been granted that the foreign investor can then apply for a business licence.

Real Estate

Valley Trunk | Virgin Gorda

The Business Licensing Act requires that all persons engaging in business activity in the BVI shall first obtain a business licence, which includes certain businesses which are currently licensed under separate legislation such as the Securities and Investment Business Act 2010. The cost of business licenses face a substantial annual increase, particularly for foreign investors, with the cost of licenses ranging between $150 to $1,500 for Belongers and $1,500 to $15,000 for foreign investors. For Belongers, the process of applying for a business licence is not dissimilar to the process currently in place for trade licenses with the exception of the cost of the licenses, which will increase. For foreign investors, applications have to be accompanied by a certificate of approval for investment and an investment business profile along with personal and business references, police report and other required documents including evidence of experience in the industry being applied for. Applications for businesses also need to provide evidence that the business is majority owned by a Belonger. There seems to be some debate about this point as during a public meeting on the two acts held by Government, the representative making the presentation stated that a foreign investor will be entitled to apply for a business licence through a company which was not majority owned by a Belonger. The discrepancy was pointed out during the meeting so the final version of the act may clarify this point. Renewal of business licenses require each business to make an application for renewal accompanied by certain documents which include a certificate of good standing, evidence that all payroll contributions have been made, registers of shareholders and directors, any licence or permit required under any other law to engage in the business and the renewal application fee. The Commission will consider the same requirements for a renewal of a license as it did when originally granting a license, namely the previous conduct of the business and the persons holding an interest, whether the business or proposed business activity has been reserved for Belongers, the efforts made by the company to obtain Belonger participation in their business, the necessity to

limit the number of businesses operating within a particular sector and the socio-economic impact of the proposed business activity to the economy of the BVI. Schedule 1 of the Business Licensing Act has three parts : Part A sets out business activity annual fees; Part B sets out reserved business activities annual fees and Part C joint venture business activities annual fees. The Act states that business activities specified in Part B are reserved for Belongers and a non-Belonger may not engage in any business specified in Part B unless authorized to do so by the Commission. The Act specifies that this restriction does not apply to non-Belongers already licensed for a restricted activity prior to the commencement of the Act. Part C relates to business activities where a non-Belonger may enter into a joint venture with a Belonger. The Act also states that “the Minister shall prescribe the percentage of the issued share capital” when deciding what constitutes the majority Belonger ownership in a company. The acts referred to above set out a radically new framework for the Government to engage with investors, both domestic and foreign, although the Investment Act does focus particularly on the nature of foreign investment in the BVI. Both acts encourage the participation of Belonger investment in foreign owned companies and actively promote joint ventures, although in a transparent manner to avoid the issues of “fronting” which, although illegal under existing legislation, has been perceived to happen too often. There are many questions still to be answered relating to the acts, and particularly the Investment Act. The threshold of investment which will determine qualification for registration as an investor has not been determined and presumably will separate the types of investment that the Act is intended to capture. While “assets that are of a personal nature, unrelated to any business activity” are not captured by the Act, and could therefore presumably include investment in residential property for personal use, the question arises whether foreign investors wishing to acquire a residential property with the intention of renting will be captured by the Act if the level of investment exceeds the yet unknown threshold.

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Water's Edge Villa | Virgin Gorda

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UK AND BVI RELATIONS

he BVI has been in the spotlight this past year with a Commission of Inquiry (CoI) established by former Governor Augustus Jaspert just prior to his dep arture in January 2021. Sir Gary Hickinbottom, a senior UK judge, was appointed as the sole Commissioner and the terms of reference as set out on the Commission’s website are “to establish whether there is evidence of corruption, abuse of office or other serious dishonesty that has taken place in public office in recent years, and if so what conditions allowed this to happen. This will ensure that BVI’s governance is working in a fair and transparent manner for the people of BVI. The Commissioner will report his findings and recommendations to the Governor. The Commission of Inquiry is not a court, therefore it will not make findings of criminality.” The Commission, convened on 18 January 2021, commenced private hearings in the week commencing 3 May 2021 and public hearings in early June. In the interests of transparency, public hearings were shown live on a dedicated You Tube channel, allowing the public to follow the Inquiry firsthand. The CoI covered a range of topics during the public hearings including the Government’s handling of the pandemic stimulus packages, statutory boards, Crown lands, the Auditor General’s reports (and by extension the various projects the reports were reviewing) and a range of other topics. Former Governor Augustus Jaspert and current Governor John Rankin also both appeared before the CoI. The final public hearing was held on 17 November 2021, with the cross examination of the present Governor at the request of the BVI Ministers. The Commissioner has sought and received an extension for the submission of the report to the Governor, which is now expected by April 2022.. The Commission of Inquiry has been momentous for the people of the BVI, exposing the inner workings of Government, and has divided the populace between those who view the CoI as an imposition by a colonial power and those who hope the CoI will lead to change in how the BVI Government operates. Whatever beliefs are held, the CoI should bring about change, not just for the BVI but also for the UK in the way it administers the Overseas Territories. Outside of the CoI, the BVI is still undertaking a review of the constitution which was last updated in 2007. In February 2021, the Government approved funds to establish the Constitution Review Commission amid calls for the BVI to have greater control over its internal affairs. Some of these issues have been highlighted in the CoI, but in August, the UN reaffirmed the BVI’s right to selfdetermination at the United Nations (UN) Committee of 24’s (C-24) regional seminar on decolonization held in Dominica. The Deputy Premier, Dr. Natalio Wheatley, expressed concerns at the seminar that the UK would use the findings of the COI to take away the BVI’s autonomy. Dr. Wheatley stated after the seminar, “The UN via the C-24 has again reaffirmed the right of the people of the British Virgin Islands to self-determination and for self-governance in the Territory to be upheld. They have clearly called on the Administering Power, the United Kingdom (UK), to respect the UN Charter and international law which covers the special rights of the BVI and those societies on the UN list of Territories yet to be completely decolonized. This includes the BVI’s current constitutional position and plans for Constitutional Review.” Relations between the BVI and the UK have unquestionably been strained with both the former Governor and the Premier each pointing to reasons for the breakdown in their interaction which were highlighted during the CoI hearings. Neither the UK nor the BVI will wish for this situation to continue, although the outcome of the CoI could determine the next steps with regard to progress with the constitutional review and the future governance of the territory.

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The Cliff House is perfectly nestled on the hillside of Scrub Island above the azure waters of the sparkling Caribbean.

Cooper Bay Villas are situated on Tortola, in the heart of the Caribbean with unspoiled views of the coastline and open sea.

Calypso is a high quality 3-bed/3.5 bath rental villa with private pool located on the idyllic island of Virgin Gorda

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Eastover Estates is a small covenanted residential subdivision offering a variety of single family home sites

Real Estate

Set within nineteen acres of lush gardens, Valley Trunk comprises five separate villas and an infinity pool.

Quart- A-Nancy Point overlooks Manchioneel Bay and the Sir Francis Drake Channel with spectacular 180 degree western facing views of the Caribbean sea.

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espite the many issues that have impacted the BVI since 2017, the real estate market has generally proven to be resilient. Bouncing back after Hurricane Irma in 2017, the market was driven by local investors acquiring damaged homes from mainly foreign investors who sought to exit their investments rather than face rebuilding in uncertain times. By late 2019, with many homes repaired and the first high season where foreign investors could properly visit the BVI after the hurricane, there was a return to more normal market conditions. However, this was quickly brought to an end in late March 2020 as the outfall from pandemic swept through Europe and the Americas, closing borders and stopping visitors from entering the BVI.

The total volume of sales doubled from $58M in 2018 to $112M in 2020. 2021 is also on course to record significant total sales with $74M in completed sales through to the end of September 2021. With the stamp duty exemption ending in December 2021, it is expected that there will be a number of Belonger purchasers looking to push sales though prior to the end of the year.

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105

US$20

US$10

2018

2019

126

2020

100

2021

CHART 2: BVI REAL ESTATE MARKET: TOTAL SALES VOLUME ($M) The impact of foreign investment on the property market in the BVI is significant, not only in terms of stamp duty income to the BVI Government, as foreign investors pay a rate of stamp duty at 12% compared to Belonger investors at 4%, but also through the rentals that follow where foreign owners have been granted consent to rent under their landholding licence or through a resort development. The villa rental market in the BVI provides significant land-based accommodations which in turn generates hotel accommodation tax for Government plus income for local businesses including car rental firms, restaurants, spa and health providers, provisioners etc. Chart 3 demonstrates the impact on total sales volume of property sales at Oil Nut Bay, Moskito Island and Little Dix Bay, the three prominent resort developments in the BVI with residential components. The chart shows how sales initially commenced at Little Dix Bay in 2005 with sales at the resort peaking in 2007-08. Sales at Oil Nut Bay and Moskito Island commenced in 2010 and peaked in 2015/16. There followed a decline in sales in 2017/18 following Hurricane Irma before sales picked up again in 2019 and 2020. US$120

TOTAL SALES VOLUME ($M)

The post Hurricane Irma real estate market has been active particularly amongst local investors. The following charts and graphs show how the real estate market has changed over time as Belongers have replaced foreigners as the primary investors in real estate in the BVI. First, with Chart 2 we look at total property sales for all categories (land, residential homes and commercial property) by quarter since 2018. This shows the increase in sales in 2020 which started before the pandemic lockdown began (late

140

US$30

2021 has witnessed a real estate boom in North America where agents have reported a record number of sales fuelled by pent-up demand following the reopening of economies. Many islands in the Caribbean have seen a similar boom, with investors seeking second homes, for personal use or investment, which has been reflected in record sales in many jurisdictions. While the real estate market in the BVI has improved both in terms of levels of interest and number of sales, the market remains slower than in other parts of the Caribbean. The data shows that the market is dominated by sales to Belongers rather than an increase in interest from foreign investors although this may change once sales to foreign investors, which commenced in 2021, start to close towards the end of the year or early 2022. There are a number of reasons why the BVI real estate market may lag behind other Caribbean destinations, with airlift, Government regulations and pricing all playing a part. Ultimately, property in the BVI takes time to sell, unless competitively priced, and for the past fifteen years, the supply of houses has been greater than demand. The exemption on stamp duty for Belonger purchasers has, as noted above, fuelled an increased number of sales with land sales in particular growing considerably in late 2020 and early 2021, with demand for land outstripping supply for small to medium sized lots.

Count of Price ($M) Total sales ($M) with number of transactions in bold

US$40

TOTAL SALES VOLUME ($M)

Far from the real estate market slowing down, the local (Belonger) market continued to invest in property during 2020, buoyed by the stamp duty exemption for Belonger purchasers which was introduced in 2020 and then extended to the end of 2021. 100% loans on land were also offered to Belonger purchasers by the National Bank, further encouraging investments in land. While foreign investors were limited in making inspections due to restrictions on travel, new ways of presenting property through virtual tours kept the overseas market alive until borders could re-open and inspections could take place. Some sales to overseas investors even occurred without inspections having taken place, relying on virtual tours and video presentations, but these were the exception.

March 2020) but was then sustained for the remainder of 2020 and 2021 through the stamp duty waiver for Belonger purchasers which came into effect in July 2020 (with exemptions back dated to May 2020). The cost to Government of the stamp duty waiver is estimated at $4.35M based on sales to Belongers between May 2020 and September 2021.

Luxury Estates* Rest of Market

US$90

*Little Dix Bay, Oil Nut Bay & Moskito exc. Little Thatch

US$60

US$30

1998

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

CHART 3: BVI REAL ESTATE MARKET IMPACT OF LUXURY ESTATES ON WTOTAL MARKET SALES VOLUME ($M)

2020

NUMBER OF TRANSACTIONS

BVI REAL ESTATE MARKET REVIEW

Real Estate

There has been a total of 66 house sales to Non-Belongers between 2018 and September 2021 with 2020 representing the highest number of sales with 23 homes sold while the first three quarters of 2021 have seen a total of 16 sales to Non-Belongers. Of the 66 homes sold to Non-Belongers, 57% were on Tortola totaling $28.1M in sales volume at an average price of $740,000 compared to $1,415,000 on Virgin Gorda.

NUMBER OF HOMES SOLD

There have been 271 house sales since 2018 with Belongers acquiring 205 which represents 76% of all house sales. The 271 sales equated to $156M in total sales volume with Belongers accounting for $94M in sales or 60% of the market in terms of value. Chart 4 also indicates how the sale of homes to Belongers peaked in late 2020 and early 2021 as Belonger purchasers took advantage of the stamp duty waiver. A similar peak occurs in Chart 5 representing the volume of sales to Belongers with the last quarter of 2020 and the first quarter of 2021 accounting for 30% of the total sale volume for the period 2018 to September 2021. Eighty percent of all house sales to Belongers were on Tortola accounting for $73M in total sales volume with an average home price on Tortola of $445,000 compared to $542,500 on Virgin Gorda.

2018

2019

2020

2021

CHART 4: HOMES SALES IN THE BRITISH VIRGIN ISLANDS: NUMBER OF HOMES SOLD US$14

Belonger Non-belonger

US$11

US$7

US$4

2018

2019

2020

2021

CHART 5: HOMES SALES IN THE BRITISH VIRGIN ISLANDS: TOTAL SALES VOLUME ($M)

Chart 6 also shows that house sales over $1.0M accounted for only 13% of sales. There was a total of seven sales greater than $3.0M in this period of which three were at Oil Nut Bay. Two of the seven sales were to Belonger purchasers.

80 <$1.0M

$1.0M-$2.0M

$2.0M-$3.0M

71 60 NUMBER OF HOMES SOLD

The market for land in the BVI has been active in the post Hurricane Irma landscape. Land acquisition has always been important to BV Islanders and even though many have “family land”, the ability to build a house, perhaps with an apartment beneath to assist with repaying the mortgage, is as much a part of life for BV Islanders as having a job. It is no surprise then that the land market has seen significant growth over the past few years, stimulated as well by the general movement of property post Irma, the stamp duty exemption for Belongers and the ability to obtain 100% loans on land. The land market has been particularly active on Tortola, assisted by the opening of a number of sub-divisions in different parts of the island.

Belonger Non-belonger

TOTAL SALE VALUE OF HOMES SOLD ($M)

Charts 4 and 5 compare the number of homes sold to Belongers and Non-Belongers (Chart 4) between 2018 to 2021 (Q3) and the total sales volume for houses over the same period (Chart 5). The charts clearly show how house sales to Belonger investors have come to dominate the market in the BVI both in terms of number of sales and total sales volume.

46 40

20 9 5 1

7 2

0 2018

2019

2020

2021

CHART 6: HOMES SALES IN THE BRITISH VIRGIN ISLANDS: TOTAL SALES VOLUME ($M)

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Charts 7, 8 and 9 breakdown the acquisition of the number of lots, acreage and total sales volume between Belongers and NonBelongers for the period 2018 to September 2021 excluding Crown land and lots at the high end residential sub-divisions at Oil Nut Bay, Little Dix Bay and Moskito Island. There have been a total of 443 residential lot sales during this period with 423 lots being acquired by Belongers representing 95% of the residential lot market (Chart 6). Residential lots sales have accounted for the transfer of 211.6 acres (Chart 7) with sales to Belongers totaling 193.4 acres or 91% or the total acreage sold. From this data, the average lot size sold to Belongers is 0.46 acre while the average lot size sold to Non-Belongers is 0.91 acre.

In total, Belongers spent $37.7M acquiring lots over this time period (Chart 8) at an average price of $89,034 per transaction or $194,775 per acre. In contrast, Non-Belongers spent $4.5M on acquiring residential lots or $225,170 per transaction at an average of $246,775 per acre. There were a total of thirteen transactions within the high end residential sub-divisions at Oil Nut Bay, Little Dix Bay and Moskito Island representing a total of $43.5M in sales which equates to $3.35M per transaction or $2.32M per acre. Sales within these three developments represent 52% of total lot sales in the BVI. Of the thirteen sales, three were to Belongers totaling $10.3M in sales or 24% of the total value of the lot sales within these developments.

Belongers

Non-belongers

CHART 8: RESIDENTIAL LOT SALES IN THE BVI: TOTAL ACRES SOLD 2018-2021* *excluding Oil Nut Bay, Little Dix Bay & Moskito

Outside of the three resort developments on Virgin Gorda (Oil Nut Bay, Moskito Island and Little Dix Bay), there have been a total of 443 lots sales between 2018 and September 2021. Chart 10 breaks down these lot sales into price bands, with 55% of lot sales falling between $50,000 to $100,000 and 22% under $50,000 leaving 23% of lots sales above $100,000.

CHART 9: RESIDENTIAL LOT SALES IN THE BVI: TOTAL VALUE OF SALES 2018-2021*

<$50,000 $50,000-$100,000

$100,000-$150,000 >$150,000 60

NUMBER OF SALES

CHART 7: RESIDENTIAL LOT SALES IN THE BVI: NUMBER OF SALES 2018-2021*

193

423

40 33 25

31 24

20 14

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0 2018

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CHART 10: RESIDENTIAL LOT SALES IN THE BVI: NUMBER OF SALES BY PRICE RANGE (THROUGH Q3 2021)

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The market for residential lot sales is dominated by sales on Tortola, with the sales between 2018 and September 2021 reflected in Chart 11. The chart shows how the sale of residential lots increased substantially in the last two quarters of 2020 and first two of 2021 accounting for 49% of all residential lot sales on Tortola in this period.

s we move into 2022, the tourism sector is expecting a busy high season and already the islands feel different with the return of the cruiseships and anchorages once again looking full. With increased tourism will come the risk of more spikes in COVID cases. The BVI Government has been steering that difficult course finding the right balance between opening the economy, encouraging vaccination and implementing protocols to reduce and contain the risk of community spread of COVID. The return of tourists will inevitably bring an increase in the number of foreign investors to the BVI seeking a house in the sun. While the substantial increase in Belonger investment in both land and houses since Hurricane Irma is excellent news, the more muted interest from foreign investors in the BVI at a time when other Caribbean islands are reporting a real estate boom, highlights the movement of the real estate market in the BVI towards local investment. There has certainly been more interest from foreign investors in real estate in the BVI during 2021 but we may not see this impacting the sales data until late 2021 or early 2022 when sales to foreign investors eventually close.

Despite the increased demand, the average price for residential lots on Tortola has not changed significantly, showing a small increase at the end of 2020 in line with increased demand. The average price per square foot ranged between approximately $4.00 to $4.40 per square foot over this period. One segment of the real estate transactions that is not captured by Land Registry data is the sale of property through the transfer of shares. Purchasers often acquire property in the BVI through a company and when selling, have the option of either selling the asset or selling the shares in the company. While the sale of an asset is recorded in Land Registry, the sale of shares in a company that owns real estate is not. Therefore, data relating to the sale of houses in the BVI, does not reflect the sale of shares in a property company. In the past, the quantity of these transactions have been negligible, as most purchasers prefer not to take on the risk of buying shares in an existing company where warranties can be difficult to enforce. While there have been some sales of property through share transaction over the past three years, these have generally remained well in the minority. 30

US$7.00

Acres sold, with number of transactions in white

US$5.25

US$3.50

US$1.75

11 2018

17 2019

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CHART 11: RESIDENTIAL LOT SALES ON TORTOLA: TOTAL ACRES SOLD AND AVERAGE PRICE PER SQUARE FOOT

US$0.00

Sale Price per Square Foot

ACRES SOLD

Average Price PSF ($) Count of Acres2

The long road to reopening the economy through much of 2020 and 2021 will hopefully be behind us in 2022, with tourism looking set for a busy high season, provided the new variant Omicron does not spoil the fun. Its emergence at the end of the year has certainly caused consternation with new worldwide travel restrictions and economic impacts, but it remains too soon to know if this is just a scare or something more significant. We can also expect an increase in interest from foreign investors, as more people visit the BVI, and hopefully the growth in investment from Belongers will continue after the end of the stamp duty waiver at the end of the year. The passing of the Investment Act and eventually the Business Licence Act, will introduce a new environment for local and foreign investment alike to navigate. With policy surrounding these acts still to be announced, we will have to wait to see the impact these acts may have on investment and growth in the BVI. | BB

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Photography by TIMELESS FILMS & MEDIA

The Decider CLARENCE M. FAULKNER An investor conversation

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n late October, our editorial team sat down with Clarence M. Faulkner, Managing Director of PMI, shortly after unveiling his new offices in Road Town, a major upgrade that brings WALL STREET to Road Town complete with a top tier trading floor. We wanted him to share his insights behind what is a great leap forward, deeper into the financial services, at a challenging and pivotal time in the global finance marketplace. The early stages of a period when volatility is creeping back, inflation, transitory or not is on the rise, China is maturing and decoupling from the US, serious supply chain issues plague global manufacturing and production, coupled with rising energy prices, just as the world attempts to finally pivot to a green future.

Your upgrade is taking place at a challenging and pivotal time in the global finance marketplace. After what has been a relatively calm period and one of significant growth, post the 2008 global financial crisis, volatility is creeping back, inflation, transitory or not is on the rise, China is maturing and decoupling from the US, serious supply chain issues plague global manufacturing and production, and energy prices are rising just as the world attempts to pivot to a green future. What do you see as the key drivers for PMI’s growth prospects over the next decade?

What was your inspiration for taking PMI to the next level?

What role does Asia play in your long-term plans for growth?

A genuine passion for helping people in a meaningful way. For the most part, retirement planning, pension plans, and investments are contributors to a sustainable life. Our approach is to educate and provide solutions that persons can control, the key ingredient to sustaining their lives and those dependent on them.

Give our readers a bird’s eye view of PMI products and services? The firm specializes in the field of pensions and Investments. On Pensions, we consult, manage, and administer pension plans and social protection systems that conform to the operational efficiencies of each entity. PMI’s customized approach affords companies the flexibility of having a system that contributes to the overall environment of managing their human capital, while complementing their desired outcome. On the Investment side, we offer investment research and analytics, search and selection of securities, portfolio management, private wealth management, each of which can be used as economic substance by BVI international business companies.

I believe this is a good time for us. I have always maintained that every crisis creates opportunities. As stated, we have had a pretty good bull run over the last 12 years. Despite some short-lived events, we continue to bounce back locally from the trio of storms in 2017 and globally over the previous 18 months from COVID-19. As the world rebounds from COVID-19, we are witnessing persons being more conscious about their financial affairs. We see technology enabling solutions. Most importantly, commerce and trade must continue to foster global growth and its economic offshoots. Locally, are we prepared for the next cycle of economic growth, economic activity? At PMI, we are. Companies and their employees demand better services from their pension service providers, and companies and families are increasingly looking for alternative ways to effectively manage their assets.

With the Asian peninsula being the largest geographical market share of our international business companies and the recent demands for economic substance, we see the added value by offering a more in-depth service, leveraging those companies domiciled here. As mentioned earlier, commerce and trade must continue, companies and family financial demands remain, and our vehicles continue to enable solutions. PMI sees the added value created in the investment space, with the launch of an investment trading floor from right here in the BVI, assisting BVI-based vehicles.

Clearly, the pivot to a green global economy now seems finally in the cards, are you focusing on specific opportunities in the green space as part of PMI’s growth strategy? Green energy and green economics have become more prevalent in everyday conversations, because of increased global awareness and concern for climate change. We are now navigating in a world where resources other than fossil fuel are used to generate electricity. Among the renewable energy sources are water, wind, and solar energy. So naturally, there are green investment opportunities to explore, and while PMI has not adopted a direct approach to green investments, indirectly, if the fundamental is investible then yes, we will explore all avenues for investment. PMI continues to monitor international discussions, led by key agencies such as the OECD and the United Nations – to name a few, on the relationship between sustainable development and investments, specifically the need for global best practices to create a regulatory framework conducive to green investment. In short, as the work continues in this area by the requisite gatekeepers, so too will PMI’s interest and research efforts.

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Does BVI prowess in the global financial services space create regional opportunities for PMI? Once there remains economic activity, trade, facilitation of business transactions, BVI vehicles should always aim to be part of that discussion. Any Company, family office, plan sponsor, or individuals seeking the full range of pension services and/or investment-related services creates an opportunity for PMI to assist.

You have clearly assembled an able team, tell us about the team and your strategy in building it? There is always a delicate balance in finding the right individual(s) based on the company’s growth trajectory. People are creatures of habits and will react in an environment where they can thrive. We have a unique way of building the Team. Everyone on staff has a say in whether a new candidate will join the Team. Competence and experience are all very important, but the real challenge is knowing if the person fits and do they buy into our purpose and business model. I am very excited about the team we have assembled. A mixture of youth and experience creates an amazing balance, but a group buying into this journey is a testament to our process. The right aptitude matched with the right attitude continues to produce amazing results for us.

Let’s look at PMI in five years, where do you see the firm? What metrics would denote success to you? An increase in the number of companies throughout the region using our services, increased percentage of BVI domiciled investment entities using our services, growth in our Team, not just numbers but also in experience, personal development, and advancement. Where we are in our history, the importance of technology and financial transactions, Investment has to become casual conversation, where the public is aware and advanced on investment products and services.

Without getting in the weeds, have you seen an evolution in how BVIslanders engage in long-term financial investment? Not enough! – we have a cadre of young professionals who wish to start earlier than, let us say, ten years ago. I am of the view that education and access will contribute significantly. This segment of PMI’s business has grown 3-fold over the last year, and we estimate that this upward trend will continue. Moreover, we aim to contribute to discussions commencing at an even earlier age with several new initiatives we have on the horizon.

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Do you see a need for governmental action that would further spur and foster such investment? We must accept that the BVI of 1980 – 2000 was a different era, 2000 – 2020 was another, and I dare say 2021 – 2040 will be another. With this, the everchanging dynamics of a people and the environment in which we live will demand that we evolve into a more financially savvy jurisdiction. In my opinion, Government’s role should be to create and foster an environment conducive for businesses to thrive. The environment includes the various elements of infrastructure, access to a higher level of education, enforcement, and management of our natural resources, and being prepared to execute based on calculated risk.

You have brought Wall Street to Road Town, what has been the feedback to date? That has been the saying lately. The response has been unbelievable, especially from youngsters who have asked their parents to come by and witness firsthand the analyst and traders in action. We are able to show persons at all levels how the investment process is executed. Our Client Relations area has been busy; we have already added to that Team a new member based on the volume of new accounts since the launch. It’s a good place to be.

Look into your crystal ball for a moment, how do you see the BVI evolution and continued role in the global financial services space? We have to continue the fight that we are a legitimate enabler of commerce, fostering economic activity, promoting and elevating financial services, and leveraging the foundation of those yesteryears as we contribute to the new BVI economy and the global economy. When we look at the global wallet and the role the BVI plays in managing and or creating vehicles that form part of that wallet, how much more of that wallet can we assist with? We should not and cannot afford to simply sit back and lose the portion we have earned over the years.

As you know, Robert Mathavious retired late last year after yeoman’s work at FSC and positioning the BVI financial services sector on the global stage. Who, in your opinion is the next Robert Mathavious in waiting? And how do we foster and nurture a talent pipeline that produces future Roberts and Clarences? Let me be clear, I consider that there will never be another Robert Mathavious. He is extraordinary, and the BVI should be so very proud to call him one of our own. I also believe that we have some very bright and talented persons amongst us. In most cases, some are oblivious to their potential - clueless about whom they will become and what they will eventually produce. The real question is, ‘Are we creating the right environment for future visionaries and leaders to make a worthy contribution?’ Have we accepted that we can and should play a major role in the global economy, despite our size? The BVI should neither settle nor simply exist. The BVI should and must be recognized as a Territory of visionary leaders in financial services.

We have to continue the fight that we are a legitimate enabler of commerce, fostering economic activity, promoting and elevating financial services, and leveraging the foundation of those yesteryears as we contribute to the new BVI economy and the global economy.

The BVI was instrumental in facilitating the rise of China and thus helping to move hundreds of millions from poverty to the middle class globally via its facilitation of globalization, was that BVI high watermark in the global financial services space? Is there a similar opportunity in Africa and India as they rise, not to mention aspirations for Global Britain? One such initiative is China’s Belt and Road Initiative that should link Asia, Europe, and Africa to promote integration, trade, and economic growth. Complementary to this will be the economic multiplying effect that will continue to reduce poverty and elevate the middle class. The flexibility of BVI vehicles can indeed continue to play a role in initiatives such as this one. Many of the new Leaders in Africa have embarked on various initiatives to create economic prosperity for their respective countries.

Is it time for the jurisdiction to engage in McKinsey 2.0 focused on the sector’s next decade? More importantly, if one has not been completed, I believe it is time for the jurisdiction to conduct an autopsy and postmortem of McKinsey 1.0. Retrospectively, what did we take away from the McKinsey assessment, and how did it translate into how we do business? What were the economic and social impacts on our jurisdiction? To plan for the next stage or decade, it behooves us to learn from our past. What have we learned? The dynamics of the global economy have changed. We must therefore be progressive to remain a global partner in commerce and trade.

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You were, for many years the brain power and the architect behind the growth of the SSB investment portfolio. As the SSB enters maturity, how do you see its evolution?

You are clearly a strong family man, tell us about striking the work-life balance, and does owning the company help?

I consider maturity for the SSB to be a good number of years off – about another 20 – 30 years. I would like to believe that the foundation of the investment policies and procedures remains robust, factoring in the necessary adjustments based on actuarial studies and investment strategies based on market outlooks. The System continues to benefit from what can be termed a transient workforce. As we continue exploring additional avenues to transform the BVI economy, I hope that new ventures create employment opportunities at the highest level where meaningful contributions are remitted to the system, increasing the gap between contributions against benefits and expenditures. There should always be recognition of extending that period of equilibrium and the continued long-term sustainability of the system. If the execution of the governance framework remains, the longevity of the system will outlive us as we know it.

One of the things I try not to do is mix the two. Family time is family time, and work is work. The greatest contributor to all of this is my wife and kids. They understand what I am doing, and I am forever grateful for the sacrifices made to allow me to do what I do. I do not have an office at my residence because they must have full access to me when I am at home. It is an understanding and a belief that we communicate and appreciate what is at stake regardless of the circumstances. I have also instilled a similar philosophy at PMI. Despite our core functions and focus, the Team understands that family matters are non-negotiable. In other words, where the family is involved - drop PMI’s work and go. Family should always come first.

What’s currently keeping you awake at nights? Nothing really, when it is time to sleep, I do – However, my mind is always on the next hurdle in this journey, and how can I continue advancing and making a difference in what I do at the Firm, the lives of my team members, and our clients. Also, watching my kids grow up and creating an environment where they can thrive also consumes headspace, as the world is continuously changing. I contemplate how I can help prepare them until they are ready to walk their path in life. I do not worry about things I have no control over, and for those, I can contribute to, I am not afraid to make a tough decision.

Owning the Company has both pros and cons. For example, I have the flexibility to schedule my time around important family matters; however, what example would I be setting for the staff to follow. Therefore, I am always very mindful of who is watching - whether my kids or my Team.

How does Clarence Faulkner relax and enjoy downtime? The interesting thing is that I am always relaxed, as I have mastered the trait of not worrying about things I cannot control. Just a few hours in my ‘boardroom,’ which is either my outdoor garden or on the water with my Dad and son, and it does not get any better than that. That is my downtime.

What book is currently on your night stand? Actually, over the last few months no real book per se, instead more of a focus on strategy especially with the recent launch of the new Offices, and already locked into the next hurdle. For example, looking at avenues of increasing the level of discussions on investments between parents and their kids. I am currently immersed in building a program on how we can bridge the gap and start the discussion at an early age. I have laid out the concept on my dining room table that will eventually feed into building investment portfolios for kids, based on what kids/ teenagers/young adults are doing today. Thus far, my 12 and 13 year old have joined me as a test case and I am very optimistic that we will add others as part of the pilot going into the final product. | BB

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Articles inside

An Investor Conversation with Clarence Faulkner

Are we losing our advantage as a dominant player in the global yachting space?

Business BVI sits down with David V. Johnson for an update on Oil Nut Bay

A Luxury Wellness Tour of the BVI

Dr. Robert a Mathavious: Nation Builder