2019 US Virgin Islands Code
Title 13 - Corporations and Associations
Chapter 5 - Corporation Franchise Tax
§ 533. Failure to pay tax; penalty

(a) No corporation may commence or maintain any action in any court if it has not paid its annual franchise tax last due. A certificate of the payment of such annual franchise tax, or any duplicate of such certificate under the seal of the Lieutenant Governor, shall be prima facie evidence of such payment. The Lieutenant Governor shall issue such certificate upon request. Notwithstanding the foregoing provisions, before a pending case may be dismissed, a corporation shall be given a reasonable time to provide proof that arrangements have been made to pay any delinquent franchise taxes once the matter is brought to the court's attention, as it is the purpose of this statute to collect the franchise tax and not simply to dismiss a case. If the proper proof is presented to the court that such arrangements to pay any delinquent franchise taxes have been made with the Lieutenant Governor's Office, a pending case shall be allowed to proceed without being dismissed.

(b) Failure of any corporation to pay its annual franchise tax for a period of one year from and after the date when such payment first became due, shall be prima facie evidence of the insolvency of such corporation and the fact of such insolvency may be shown by the government of the United States Virgin Islands or by any private person or corporation.

(c) The Lieutenant Governor upon determination that any corporation has neglected for a period of one year to pay its annual franchise tax, shall—

• (1) if the delinquent corporation is a domestic corporation, make a notification upon the records of his office that such corporation is dissolved and it shall thereupon be dissolved and the directors of such corporation shall hold title to the property of the corporation as trustees for its stockholders and creditors to be disposed of under appropriate court proceedings; or

• (2) if the delinquent corporation is a foreign corporation, make a notification upon the records of his office that the authority of such corporation to do business in the United States Virgin Islands is revoked and it shall thereupon be revoked; provided, that no domestic corporation shall be dissolved, and no foreign corporation shall have its authority to do business in the Territory revoked, for the nonpayment of franchise taxes which the Government is barred from recovering by the statute of limitations set out in Title 5, section 31, of this Code.

(d) Any corporation thereafter organized may take and shall have the exclusive right to use the corporate name of any corporation so dissolved: Provided, That, no individual or company formerly affiliated with the dissolved corporation may be entitled to use the name of such corporation until all outstanding tax obligations of the dissolved corporation have been satisfied.

(e) No individual or business entity formerly affiliated or associated with a dissolved business entity shall establish a new business entity without first providing written proof to the Corporate Division of the Office of the Lieutenant Governor, the Virgin Islands Bureau of Internal Revenue and the Department of Licensing and Consumer Affairs that all outstanding tax obligations of the dissolved entity owed to the Government of the Virgin Islands have been satisfied or that agreement to pay the same has been satisfactorily made.