Anguilla: Anguilla Financial Services Commission
Last Updated: 13 February 2004

On 2nd February 2004, the Anguilla Financial Services Commission commenced operations. It replaces the Financial Services Department of the Anguillian Ministry of Finance. The creation of the Financial Services Commission was originally recommended by the international accounting firm KPMG which conducted a review of financial services regulatory practices in Anguilla as well as the other British Overseas Territories and Bermuda in 2000. The International Monetary Fund also recommended that Anguilla create the Commission as soon as possible when it conducted its Financial Sector Assessment Programme (FSAP) Review in 2002.

The Commission resulted from the enactment of the Financial Services Commission Act that was passed in November 2003 and contains the following main provisions:

Functions of the Commission - These focus on licensing; supervision of licensees; compliance with AML/CFT legislation; monitoring of financial services in general; reviewing existing financial services legislation and making recommendations for new legislation; encouraging the development of high professional standards throughout the industry by way of codes of conduct; maintaining contact with appropriate foreign regulatory authorities by way of memoranda of understanding and with international associations of regulatory bodies; and providing information and advice to the industry and to the public on matters of financial services.

The appointment of a Board of the Commission and the functions of such a Board, which include inter alia establishing a Commission policy and overseeing its implementation; monitoring the effective administration of the Commission; and approving budgetary plans.

An important provision with regard to the Board of a Commission is the provision covering conflict of interest.

General powers of the Commission, reflecting those powers that would normally be held by a body corporate.

Financial and Reporting Provisions applicable to the Commission. These detail the funding and resources of the Commission and its budgeting, accounts and audit function.

Information Gathering. This section enables the Commission to obtain regulatory information and in certain circumstances to provide assistance to foreign regulatory authorities in the exercise of their regulatory functions.

Enforcement and Disciplinary Action - This section requires licensees to appoint compliance officers; covers the ability of the Commission to conduct compliance inspections and to take enforcement action against licensees under a number of predetermined situations; and deal with suspension and revocation of licenses together with a procedure for appeals.

There are also administrative and general provisions.

The Commission will have a heavy legislative workload for the 2004. Amongst the bills it will put forward for enactment by the Government of Anguilla in the first quarter of 2004 include a new:

  1. Insurance Act to govern the conduct of domestic and captive insurance, insurance agents, brokers and managers.
  2. Mutual Funds Act to provide for the registration and recognition of professional, private and public funds; and
  3. Protected Cell Companies Act to provide for companies to apply to operate what are called protected cell accounts.

In addition, the Commission, along with the Anguilla Financial Services Association (AFSA), will conduct a review of the Trusts Ordinance 1994 to bring it in line with the latest developments in trust law and the practices of trust administration. Consideration will also be given to forming a new Limited Liability Partnership Act. The Commission will also decide on a policy for the immobilization of bearer shares that was also recommended in the KPMG report.

Speaking at the launch, the newly appointed Director of the Commission Mr. John Lawrence promised industry professionals that they could expect integrity, high ethical standards, and fairness from the Commission. He added that they could expect the Commission to consult with them on major issues, to give assistance and to provide a highly focused regulatory environment and oversight.

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