After years of planning, and the launch of St. Lucia into the financial services industry in March this year, the island is now establishing itself in the market as a unique and reliable model for financial services.
The laws passed in December 1999 include; The International Business Companies Act (IBC); The International Trust Act; The International Mutual Funds Act; The International Insurance Act; The International Banks Act, and regulatory legislation including the Registered Agent and Trustee Licensing Act, and the Money Laundering (Prevention) Act. The laws are uniquely formulated to provide an effectively regulated environment, in conjunction with satisfying the demands of the client. The IBC Act has the distinctions of allowing an election either to pay tax at 1% or to be exempted, as well as having an annual license fee of only US$300 regardless of the stated capital of the company. Trusts formed under the International Trusts Act are able to benefit from aggressive, well thought out asset protection provisions that are in line with other competing centers. The Mutual Funds Act allows for private and public funds that can be either IBC's or unit trusts. The Money Laundering (Prevention) Act serves to ensure that both the local institutions and those engaged in international financial services are aware, trained and prepared to detect and prevent this harmful activity, with a particular emphasis on the 'Know Your Customer' theme.
Regulation of the industry is carried out by the Financial Services Supervision Unit or FSSU. This dedicated regulatory body is responsible for the licensing of local registered agents (LRA's) and higher end entities such as banks, insurance companies and mutual funds. In relation to banks and insurance companies the laws seek to ensure effective supervision of the licensee rather than requiring high initial capital outlays.
There are 130 persons admitted to practice as lawyers in St. Lucia. Most of these lawyers are part of long standing law firms with established reputations and international networks. There are 100 accountants most of whom are employed in large commercial organizations and in the big five firms. All of the 10 registered agent or trust companies are owned and run by accountants or lawyers.
St Lucia's human resources offer a skilled pool of labor at a lower cost than other offshore jurisdictions. This makes establishment of service provider entities less expensive and far more expedient as most of the staff required can be obtained locally. Therefore for back office operations for fund administration, asset management or other offshore services, St. Lucia has the level of skill at a cost that makes it an obvious choice. Further there are provisions to allow tax concessions for persons employed in the sector provided certain criteria are satisfied. This makes the island very attractive to international investors wishing to establish a substantial presence in a financial services center.
St Lucia's unique public online registry which is promoted as "Pinnacle St. Lucia, the World's Only Public Online IBC Registry" has proved to be both an efficient and effective system. It allows individual clients, LRA's, their overseas agents, and the registrar of IBC's to carry out a variety of functions based on their respective roles and the control that a registry system requires. The Internet deployment and state of the art technology allows these functions to be carried out from anywhere in the world from any internet ready computer. Functions include name searches, name reservations, online incorporation, online searches and online requests for certified copies of the company files.
The government has contracted with a private sector promoter to market the jurisdiction. This entity, Financial Centre Corporation has been actively carrying out its mandate and importantly working with the local registered agents, industry experts, and industry publishers to inform and attract clients and their advisors to the territory. As the island is new in the industry the focus of the marketing effort is on the large international service providers who can influence international confidence in the jurisdiction while at the same time either establish their own service companies or become overseas agents of LRA's.
St. Lucia's strategic approach, combined with the legislative, human resource and technological infrastructure set it apart from the competition and will be major factors in its success in this competitive industry.
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.