Corporate & Financial Services

Subscribe to Corporate & Financial Services via RSS

 The Uniform Debt-Management Services Act (UDMSA) was signed into law  by Governor John P. deJongh Jr. of the Virgin Islands last Wednesday.  The act sponsored by St. Croix senators Terrence Nelson, Neville James and Samuel Sanes was drafted and approved by the Uniform Law Commission (ULC).   The UDMSA, approved by the ULC in 2005 and amended in 2008, was the result of a multi-year study into debt relief options for consumers. It is the first national effort at providing uniform rules to govern both consumer credit counseling services and debt settlement services.

 “In today’s economic climate, we are finding more and more consumers turning to debt management companies, which have tripled in number over the past few years,” said Tom Bolt, Chair of the Virgin Islands Uniform Law Commission.   “There have been frequent instances or accusations of abuse by consumers who utilize these services.  This legislation regulates the industry in uniformity with other jurisdcitions, while protecting our Virgin Islands consumers.”Continue Reading Governor Signs Bill Protecting VI Consumers Utilizing Debt Management Services

The Internal Revenue Service has released an internal memorandum indicating that it will give close audit scrutiny to offshore hedge funds that engage in lending activities with U.S. residents.  A number of hedge funds have relocated to the U.S. Virgin Islands to take advantage of the Territory’s Economic Development Commission (EDC) Program which exempts such funds from 90% of the federal income tax liability.  Although owner of EDC beneficiary companies can similarly exempt their income from the company from federal income tax if they are Virgin Islands residents, past practice has led to the hedge funds providing loans to owners who are not Virgin Islands residents. 

Hedge funds that engage in direct or indirect lending activities involving U.S. borrowers are impacted by this IRS action and should immediately review their lending practices in light of the IRS’s indication that it will pursue vigorous enforcement in this area.

Continue Reading IRS Scrutizes Offshore Hedge Fund Lending

On June 29, 2009, the United States Supreme Court decided Cuomo v. Clearing House Association which invalidated, by a vote of 5 to 4, a regulation issued by the Comptroller of the Currency that broadly preempted the states and territories from enforcing their fair lending laws against national banks. Under the broad language of the majority opinion, the Virgin Islands Division of Banking & Insurance and its sister state regulators now implicitly have the authority to enforce other consumer protection laws against national banks.Continue Reading Territory’s National Banks Subject to Virgin Islands Law

Tom Bolt & Associates, PC, one of the U.S. Virgin Islands’ leading full-service law firms, has announced that it has formed a Asset Stabilization and Strategic Economic Response Team (ASSERT) to assist its clients in addressing business challenges posed by current economic conditions. The multi-disciplinary team consists of attorneys who bring a wide range of practice proficiencies and insights to help local businesses weather the rapidly changing economic climate in the Territory.

“Our closely integrated practice groups have enabled us to formalize this team and align our service offerings with the needs of our clients,” said Tom Bolt, Managing Attorney of the Firm, and Chair of the Firm’s Real Estate & Financial Services and Government Relations Practice Groups. “Our  firm is dedicated to our clients and helping them meet the challenges they face. ASSERT evolved as our greatest resources—our legal talent—came together to tackle the complex challenges that the current economic conditions are posing for Virgin Islands businesses.”

Continue Reading Virgin Islands Law Firm Announces ASSERT

St. Thomas based Merchants Commercial Bank has refused a $1.2 million investment from the U.S. Treasury, saying the bailout money was not needed and involved a commitment to rules that could be changed down the road.

The bank’s board of directors turned down the Treasury’s offer in a unanimous vote, said Tom Bolt, General Counsel for the bank.Continue Reading Merchants Commercial Bank Refuses Fed Bailout

One of President Barrack Obama’s principal communications policy objectives is to "encourage diversity in the ownership of broadcast media . . . and clarify the public interest obligations of broadcasters who occupy the nation’s spectrum."  This has not been the case in the United States Virgin Islands where Jeffrey Prosser of Innovative Communications Corporation owned all locally produced TV stations, the local telephone company, a local cellular telephone company, all cable television stations and the local newspaper. The monopoly is ending, however, with Mr. Prosser’s ongoing bankruptcy, where the Trustee intends to sell the ICC family as a unit. While the president’s website offers no more in the way of specificity, it is commonly understood to be referring to measures that would constrain further consolidation of media ownership, and enhance broadcasters’ local service obligations.Continue Reading Obama’s Communication Policy May Impact VI Broadcast Communication

Attorney Rosh D. Alger, Chair of the Tom Bolt & Associates, PC Corporate and Tax Practice Group recently returned from Pasadena, California where he attended the ALI-ABA Forum on "Representing the Growing Business:  Tax, Corporate, Securities, and Accounting Issues."

In recapping the the three day seminar, Alger noted that during the forum, a panel of seven tax and corporate law specialists voted, under a certain fact pattern for a growing business model, to choose the LLC structure.  When asked why, six out of seven panelists who voted in favor of the LLC said that they appreciate the flexibility of the LLC.

 

Continue Reading Attorney Alger Participates in ALI-ABA Corporate Forum on Growing Businesses

 Yesterday, in its last business decision of the term, the Supreme Court overruled a nearly century-old rule treating resale price maintenance agreements as per se violations of the antitrust laws. In Leegin Creative Leather Products, Inc., v. PSKS, Inc., a 5-4 decision written by Justice Kennedy, the Court ruled that minimum resale price maintenance agreements—agreements between manufacturers and distributors to resell a product at or above a set price—will now be examined under the “rule of reason,” a method of analysis that weighs procompetitive benefits against anticompetitive effects. In reaching this result, the Court expressly overruled its 1911 decision in Dr. Miles Medical Co. v. John D. Park & Sons.

"This new ruling could have a tremendous impact on Virgin Islands businesses particularly in the liquor and cosmetics industry."  Tom Bolt, Managing Attorney at Tom Bolt & Associates, P.C. noted.  "Many manufacturers have controlled enforced strict pricing of products in the liquor and cosmetics that are widely sold in the United States Virgin Islands and has been the subject to a subtantial amount of litigation.  With the Leegin decision, these pricing controls will need to be reviewed."
 

Continue Reading Supreme Court Case Affects Virgin Islands Businesses

The Virgin Islands business community is about to get its first locally owned and operated commercial bank providing local decision making and responsive service from its headquarters on St. Thomas.

In action before the Virgin Islands Banking Board earlier today, licensing was approved for Merchants Commercial Bank which had submitted final documentation to the Division of Banking and Insurance to obtain a Virgin Islands banking license after having completed all requirements to obtain FDIC insurance from the Federal Deposit Insurance Corporation.Continue Reading VI Banking Board Approves New Bank

Merchants Commercial Bank, the newest bank in the Virgin Islands, recently achieved is capitalization as required by the FDIC and anticipates opening its doors in late October.  The bank which is lead by island banking stalwart Jim Crites has secured offices in Port of Sale Mall in Havensight  on St. Thomas and will concentrate its business activity…