ONE YEAR on from the publication of Andrew Edwards' Review enhancements are being made to the regulation of the finance industry.
Some of the Guernsey authorities' proposals have resulted from suggestions in Mr Edwards' report, while others were already under way prior to the review.
Mr Edwards was commissioned by the UK Home Secretary to review with the Island authorities of Guernsey, Jersey and Isle of Man the regulation of their finance centres, including measures to combat financial crime and the islands' co-operation with law enforcement agencies in other jurisdictions.
His conclusions, published in November 1998, included more than 160 suggestions, comments and observations relating to the islands.
Following the publication of the review the Advisory and Finance Committee set up an Advisory Group to evaluate any suggestions relevant to Guernsey and to make recommendations to the Committee.
These suggestions range from new "All Crimes" and fiduciary and trust company laws through to greater protection for depositors and the introduction of an ombudsman. A number of proposals and some draft legislation arising from this evaluation will be put to the States during 2000.
Conseiller Laurie Morgan, President of the Advisory and Finance Committee, said: "Guernsey already has an excellent reputation for its high standard of regulation but we continue to investigate ways of further enhancing the island's position as a reputable, co-operative international finance centre. It is important that the island plays its full part in the fight against crime of all types, including tax evasion.
"The Guernsey authorities, through the Advisory Group, will go on reviewing the islands' regulatory framework, its practices and its arsenal of legislation. The authorities will also continue to participate in and influence international debate and actions."
Progress on Mr Edwards' suggestions can be summarised as follows:
The Criminal Justice Law 1999, commonly referred to as "All Crimes" legislation, which had been proposed prior to the Edwards Review, will come into effect on 1st January next year.
The Police and Criminal Evidence Law, which will give the authorities additional powers to obtain information for investigations, should come into force during 2000.
The Fiduciary and Administration Businesses Law will be considered by the States of Guernsey during 2000. This innovative legislation will for the first time regulate trust companies and company formation and administration services.
The recruitment of extra police officers has been approved and additional staff have been recruited by the Guernsey Financial Services Commission (GFSC).
The suggested introduction of Financial Crime Units was not favoured by the Home Office and the Advisory Group believes that the problems it would create would outweigh the benefits.
It is proposed that the law constituting the GFSC will be amended to no longer require the board of the GFSC to include politicians. A separate promotional body, remote from the GFSC, is being considered.
It is not accepted that all limited companies should prepare and file audited accounts as this would be contrary to common practice in the UK, the USA and elsewhere.
Consideration is being given to the means by which information about foreign incorporated companies with a business presence in Guernsey could be made available to those with a legitimate interest.
A review of insolvency and bankruptcy procedures is being undertaken.
Independent, expert advice on proposed changes to trust legislation is now being considered. Recommendations will be included in the ongoing programme of regulatory reform.
The creation of a depositor protection scheme will be proposed to the States during 2000.
Proposals to create an ombudsman scheme, which were in development prior to the Edwards Review, will soon be released.
A consultation paper on changes to insurance regulation will be issued in 2000.
Changes to investment regulation will be proposed to the States in 2000.
A full copy of the report is available on the States of Guernsey internet site at www.gov.gg
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).