International Business Companies Act

The Act was passed in a partial response to the cancellation by the U.S. government of a double taxation relief treaty between the British Virgin Islands and the United States.

The British Virgin Islands was not alone in this regard; this was part of a policy of mass-repeal by the United States of double tax relief treaties with "microstates".

The Act was passed into law by the Territory's legislature on 15 August 1984 where Chief Minister Cyril Romney hailed it as the most important legislation of the decade.

However, the invasion badly shook investor confidence in Panama, and incorporations in the British Virgin Islands under the Act soared from 1991 onwards.

Use of British Virgin Islands IBCs became so ubiquitous in Hong Kong, that in commercial jargon offshore companies generally were generically referred to there as "BVIs".

After a series of discussions, the British Virgin Islands government agreed to repeal the ring-fencing provisions in its tax legislation.

To protect the offshore business, the British Virgin Islands abolished both income tax and stamp duty on all transactions except those relating to land in the Territory.