BVI/Czech Republic sign onto Tax Sharing Agreement

The Government of the Virgin Islands has taken a further step in strengthening its relations with the Government of the Czech Republic by signing a Tax Information Exchange Agreement (TIEA). Deputy Premier and Minister for Health and Social Development, Hon. Dancia Penn, signed the agreement with First Deputy Minister, Ladislav Minčič, recently at the Ministry of Finance in Prague, Czech Republic, and the MOUs were subsequently laid in the House of Assembly.

The TIEA is reportedly based on a model agreement developed by the Organisation for Economic Cooperation and Development (OECD). It is the 22nd such agreement the BVI has signed.

The TIEA will allow exchange of information by request on civil and criminal tax matters in accordance with the procedures agreed.

In a joint declaration, the BVI and the Czech Republic stated that the agreement represents a milestone in relations between the two governments and that both are committed to examining other areas of mutual co-operation and benefit.

The Joint Declaration states, “The Czech Republic and BVI have long been active in international efforts in the fight against financial crimes, and each share a common commitment to develop and comply with international standards on money laundering, terrorist financing and financial regulation. The Czech Republic recognises the BVI Government's reputation as a constructive and co-operative member of the international community with a globally integrated and responsible finance centre.”

Deputy Premier Penn specifically welcomed the protocol to the agreement, which states that in accordance with the good relationship between both countries, no prejudicial or restrictive measures will be applied to residents or nationals based on harmful tax practices.

In April 2002, the Virgin Islands committed to work with the OECD to develop principles of transparency and exchange of information in tax matters. That same month, BVI signed a TIEA with the United States (US).

The TIEA signing ceremony was arranged to coincide with an important private meeting at the Prague Business Club. Hon. Penn took the opportunity to re-establish links with the Czech business elite as the BVI continues to build on its success as a premier jurisdiction for financial services.

The Deputy Premier addressed the meeting, highlighting the TIEA signing with the Czech Republic earlier that morning and the positive relationship that exists with both governments. Additionally, Mr. Christoph Gutmann of ATU BVI, Ltd. spoke at the event with local Prague business people, including attorneys and accountants with connections to the BVI. Mr. Gutmann’s presentation focused on ‘wealth planning opportunities’ using BVI structures and services.

The BVI has signed 22 TIEAs to date with Ireland, the Kingdom of the Netherlands, Curacao, St Maarten and Aruba, the United States, the United Kingdom, Australia, New Zealand, France and the Nordic Alliance of Sweden, Norway, Finland, Denmark, Iceland, The Faroes and Greenland and China, India, Germany, Portugal and the Czech Republic.