Update: a will and estate plan covering assets BVI

BVI-held assets sit in a gap that most estate plans do not close. The gap is not new, but the triggers for it — family relocation, shifting residence ties, and the expanding reach of forced-heirship claims from civil-law jurisdictions — are arriving more frequently. For principals with a Hong Kong connection and holding entities above BVI operating or property companies, the question of how a will and estate plan interacts with BVI company law is pressing.

A will and estate plan covering assets in the British Virgin Islands requires a co-ordinated approach across Hong Kong succession law, BVI company and trust law, and the forced-heirship rules of any civil-law jurisdiction in which the principal holds residence or citizenship. The governing instruments include the Trustee Ordinance (Cap. 29), as substantially reformed with effect from 1 December 2013, and the BVI Business Companies Act, which together define how shares in a BVI company vest on death and how a trust structure may be used to contain that process. Hong Kong law has no forced-heirship regime; the BVI similarly offers strong firewall protections for properly structured trusts — but neither set of protections operates automatically.

This briefing identifies the recurring trigger, the corridor affected, and the immediate steps.

What the development is — and why BVI structures now need attention

The trigger is not a single statutory change. It is a convergence of three developments that our private wealth desk sees more frequently in the current cycle.

First, families with civil-law roots — European, Middle Eastern, CIS — are relocating to Hong Kong or to offshore jurisdictions. Their home-country forced-heirship rules may follow them, depending on the conflict-of-laws rules of their country of nationality or domicile. A BVI company held in personal name rather than in a properly constituted trust is potentially exposed to those claims.

Second, BVI company share registers have become more accessible to administrators and courts than was once assumed. Where shares in a BVI company are the only asset standing between the estate and the underlying assets — real property, listed securities, operating-company interests — the question of how those shares are characterised on death becomes material to the estate-administration process in every jurisdiction touched by the estate.

Third, Hong Kong's 2013 trust reforms under the Trustee Ordinance (Cap. 29) introduced a statutory firewall against foreign forced-heirship claims, abolished the rule against perpetuities for Hong Kong-law trusts, and confirmed that a settlor may reserve certain powers without invalidating the trust. Principals who set up BVI structures before or shortly after those reforms should now verify whether their arrangements were designed to capture the full benefit of the reformed regime.

The interaction of these three threads — civil-law residence, BVI share vesting, and the Hong Kong trust firewall — defines the current advisory window.

Who is affected and what the Hong Kong–BVI corridor looks like

The families most directly in scope are those where at least one of the following applies: the principal is domiciled or habitually resident in a forced-heirship jurisdiction; the principal holds BVI shares in personal name without an intervening trust or foundation (a civil-law entity analogous to, but legally distinct from, a common-law trust); or the existing estate plan was drafted in a single jurisdiction without a cross-border legal review.

In our cross-border practice, we regularly see structures where the holding architecture — a BVI company owned directly by the principal, with underlying Hong Kong or Mainland assets — was assembled for tax efficiency without a succession layer. That is a structuring choice that can work during the principal's lifetime. It becomes a problem at death, when the BVI shares vest according to whichever succession law applies, and the estate-administration process in Hong Kong, the Mainland, or the principal's home jurisdiction intersects with that vesting event in unpredictable ways.

The Hong Kong angle matters for a specific reason: Hong Kong is a common-law jurisdiction with no forced heirship and a well-developed trust regime. Where a Hong Kong-law trust is interposed above the BVI company, the 2013 Trustee Ordinance reforms provide a strong statutory foundation. The question is whether the trust deed was drafted to use that foundation, and whether the principal's current residence and citizenship profile is consistent with the firewall protection operating as intended.

For guidance on parallel considerations in another offshore centre, see our asset protection guide for principals with Cayman Islands exposure.

What to do now

The immediate action is a structural review across three points: the succession position of the BVI shares under the governing law of the principal's domicile; whether an intervening Hong Kong-law trust is in place and whether it was drafted to engage the 2013 Trustee Ordinance reforms; and whether the will — if one exists — deals expressly with BVI assets or simply fails to reach them.

A will that is silent on BVI assets does not necessarily leave them outside the estate. It may create uncertainty about the sequence of administration, expose the BVI shares to a forced-heirship challenge in the principal's home jurisdiction, or produce a result inconsistent with the principal's intentions. None of those outcomes is correctable after death.

The sequence we apply in practice: first, map the full asset picture — jurisdiction, ownership tier, and the succession law that would govern each tier. Second, identify where forced-heirship exposure exists given the principal's current domicile and nationality. Third, assess whether the existing trust and will structure closes the exposure or leaves gaps. Fourth, prepare the amendments or new instruments needed. That process is not a one-jurisdiction exercise; it requires engagement across Hong Kong, the BVI, and the principal's home-country position simultaneously.

For deeper analysis of the succession and forced-heirship interface across jurisdictions, our succession planning analysis covering Hong Kong and Cyprus sets out the comparative framework in detail.

The window for this work is before any estate-administration event, not during one. Parties should verify the current position under both the Trustee Ordinance and the BVI Business Companies Act before acting, as the regulatory position should be confirmed at the time of the review.

To discuss how your current will and estate plan addresses BVI-held assets and the Hong Kong trust interface, write to us at info@lockhartyip.com or visit our private wealth practice page.

Frequently asked questions

What does the route look like for a will and estate plan covering assets in the BVI?

The route typically runs in four stages: mapping the asset and ownership structure across jurisdictions; identifying the succession law governing each tier, including any forced-heirship exposure from the principal's domicile or nationality; assessing whether the existing will and trust instruments address the BVI share vesting position; and preparing or amending the instruments. Where a Hong Kong-law trust is engaged, the Trustee Ordinance (Cap. 29), as reformed with effect from 1 December 2013, provides the statutory foundation. The BVI Business Companies Act governs how shares vest on death at the BVI level. Co-ordination across both systems is required.

How long does a will and estate plan covering assets in the BVI usually take?

The timeline depends on the complexity of the asset and family structure, the number of jurisdictions engaged, and whether new trust instruments are required or existing ones need amendment. A straightforward review and will update across two jurisdictions typically takes several weeks. A more complex restructuring — involving a new Hong Kong-law trust, BVI share transfers, and co-ordination with home-country advisers — will take longer. Parties should not begin this process under time pressure; the work is meaningfully better when done calmly, before any triggering event.

What are the main risks in a will and estate plan covering assets in the BVI?

The principal risks are: forced-heirship claims from a civil-law jurisdiction attaching to BVI shares held in personal name; a will that is silent on BVI assets, creating administrative uncertainty across jurisdictions; and a Hong Kong-law trust that was not drafted to engage the firewall protections introduced by the 2013 Trustee Ordinance reform. A secondary risk is misalignment between the principal's current residence and domicile profile and the assumptions the estate plan was built on — a risk that grows with every relocation or change in nationality. Parties should verify the current position before acting.

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This publication is general information and does not constitute legal advice. For advice on your situation, contact info@lockhartyip.com.

Update: a will and estate plan covering assets in the BVI

What the development is — and why BVI structures now need attention

Who is affected and what the Hong Kong–BVI corridor looks like

What to do now

Frequently asked questions

Speak with Lockhart & Yip

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