27/10/2011

The British Virgin Islands have taken another step towards becoming one of the world's leading offshore financial centres by striking a new tax information deal with India.

The Tax Information Exchange Agreement (TIEA) - which is very similar to deals the territory already has with nations including the UK, the USA, France, Australia, China and many more - is likely to see more and more companies from the sub-continent using BVI-registered companies or partnerships in overseas acquisitions.

An exchange of tax information will be facilitated by the TIEA between India and the Caribbean island territory. Indian business owners will be able to take advantage of the modern and flexible law set-up that the BVI regime offers to foreign entities and the special purpose vehicle (SPV) often established for business sale and incorporation deals.

The TIEA will also aid with obtaining the necessary regulatory approval that is required by India companies looking to make acquisitions abroad, from the Reserve Bank of India, the Indian Income Tax Department and other regulatory bodies.

The agreement heightens an already cordial business relationship between the two jurisdictions. BVI companies accounted for around approximately US$672.8 million worth of inbound during the ten-year period to August 2010.