Regulating the Future of Financial Services in The Bahamas Senator the Hon Ryan Pinder K.C., Attorney General & Minister of Legal Affairs Download (PDF) Commercial Entities (Substance Requirements) (Amendment) Bill, 2023 Download (PDF)
We are pleased to advise that On Friday 7 January 2022, the European Commission adopted a new regulation to update the EU AML Blacklist, including delisting The Bahamas from the List of Third-country Jurisdictions which have Strategic Deficiencies in their AML/CFT Regimes (AML Blacklist). It has now been shared with the European Parliament and Council for formal consultation. After such consultation, the regulation will be published in the Official Journal of the European Union and entering into force 20 days after its publication. Please see attached press release issued by the Office of The Attorney General as well as the relevant EU Delegated Regulation. Press Release from the Office of The Attorney General, Bahamas (PDF) EU Delegated Regulation (PDF)
Only July 1st, 2021 The Government of The Bahamas officially expressed its support, for the proposals of the G20/OECD Inclusive Framework on Base Erosion and Profit Shifting to reform the global taxation system. These proposals and the accompanying rules for international taxation are geared at addressing the tax challenges arising from the digitalization of the global economy. Attached is a copy of Government’s press release as well as the OECD/G20 Statement on a Two-Pillar Solution to Address the Tax Challenges Arising From the Digitalisation of the Economy. Press Statement – Government of The Bahamas OECD/G20 Statement on a Two-Pillar Solution
The Bahamas Removed from the French List of Non-Cooperative States and Territories in Tax Matters. Source: Central Communications Unit, Ministry of Finance Date: March 8, 2021 Contact: MOFcomms@bahamas.gov.bs The Government of France has removed The Bahamas from the French list of non-cooperative states and territories in tax matters. The list, which is updated annually by the French Ministry of Economics and Finance, was published in the Official Diary of the French Republic on March 4. The French Government has imposed a number of sanctions on blacklisted countries, including applying withholding taxes at a higher rate on financial transactions involving blacklisted countries. This serves as a disincentive to French taxpayers, both individuals and companies, wishing to conduct business in blacklisted countries. Blacklisting also carries reputational risks and may affect a country’s ability to access international markets. Minister of State for Finance, Senator The Honorable J. Kwasi Thompson stated: “The decision by France to remove The Bahamas from its tax blacklist is the culmination of extensive bilateral discussions with the French Government since we were first listed in December 2019. From the moment we learned that The Bahamas was listed, we set about to vigorously disprove France’s assumptions about our commitment to the international regulatory standards on tax cooperation and exchange of information for tax purposes. Our discussions with the French authorities have been fruitful and have fostered a deeper degree of cooperation between our two countries. We have aptly demonstrated that The Bahamas is indeed doing its part in the global effort to eradicate harmful tax practices.” Over the past year, The Bahamas has amplified its engagement in the international community to defend the integrity of the jurisdiction against the criticism that it is not doing enough to curb financial crimes. In March 2020, the European Union removed The Bahamas from its list of uncooperative jurisdictions for tax purposes and in December 2020, the Financial Action Task Force removed The Bahamas from its anti-money laundering and counter terrorism financing watch list.
By The Hon. Elsworth N. Johnson, MP 15TH JUNE, 2020 DOWNLOAD PDF
The Bahamas Financial Services Board in collaboration with the Ministry of Financial Services hosted two successful briefings in Rio De Janeiro and Sao Paulo, Brazil on October 14th and 17th. The Hon. Elsworth Johnson, Minister of Financial Services, Trade & Industry and Immigration addressed attendees and reaffirmed that The Bahamas is open for business and that we value the long standing relationship built with service providers in Latin America and Brazil in particular. He went on to inform attendees that: “We are of the view that global regulation and international initiatives, whilst on the face if appear to be onerous can create opportunities. To embrace these opportunities we, as a government have begun by initiating the advancement of structural and technological infrastructure to spur and sustain growth, greater innovation, entrepreneurship and future infrastructural development. We have commenced a major digitization effort in The Bahamas. We are investing in human capital through the education, training and retraining of our professional workforce to protect the future of financial services. We are committed to supporting industry in the development of new products and services to meet client needs.” The briefing on October 14th was held in Rio De Janeiro at the Fasano Hotel and was facilitated by BFSB’s CEO and Executive Director Miss Tanya McCartney who indicated that: “We saw this as an opportune time to restate The Bahamas’ value proposition and to outline the legitimate role that international financial centres such as our play in the global economy. Leveraging our location, expertise and commitment to innovation we have what is required to meet the needs of the Latin American market.” Leading financial services experts conveyed to attendees the wide range of product and service offerings that make the Bahamas the Clear Choice for Financial Services in the region. Speakers included Mr. Brian Jones, Managing Director of Leno Bahamas, Mrs. Linda Beidler D’Aguilar, Partner at Glinton Sweeting, O’Brien, Mr. Antoine Bastian, Managing Director, Genesis Funds Services and Mr. Francesco Vanacore, Head of Fiduciary at Ansbacher Bahamas. Director, Regulatory and International Affairs in the Ministry of Finance, Mr. Stephen Coakley Wells of the Ministry of Finance provided an update on The Bahamas’ legislative and regulatory response to international initiatives impacting financial services. At the October 17th cocktail briefing which was held in Sao Paulo, Brazil at the Grand Hyatt, Minister Elsworth Johnson brought remarks and the over one hundred guests were afforded the opportunity to network with the twenty-two Bahamian professionals in attendance at The STEP Conference. While in Brazil, The Bahamas Financial Services Board arranged closed door meetings for the Minister with BFSB member firms and other advisory firms with a presence in Brazil. BFSB also sponsored the Society of Trust and Estate Practitioners (STEP) LATAM conference, which was well attended, with over four hundred registered delegates. The keynote speaker on the second day of the event was Bahamian NBA superstar Mr. Rick Fox who emphasized that the Bahamas was open for business while he spoke on the topic “ Advising The New Generation of Ultra High Net Worth Youth” Annually, The Bahamas Financial Service Board organizes briefings to provide financial service intermediaries around the world and other service providers with updates on legislative and business developments in The Bahamas, as well as to provide BFSB member firms the platform to connect with potential business opportunities.
FAQs on The COMMERCIAL ENTITIES (SUBSTANCE REQUIREMENTS) ACT, 2018 (“CESRA”)
Hon. Brent Symonette, Minister of Financial Services, Immigration, Trade and Industry recently along with Tanya McCartney, CEO and Executive Director of The Bahamas Financial Services Board , Mr. Michael Paton, Deputy Chairman of the Securities Commission of the Bahamas and past Chairman of BFSB, Mr. Ivan Hooper , Co-Chairman of The Association of International Banks and Trust companies (AIBT) and Indira Munro-Farrington , Marketing Officer at BFSB, travelled to Zurich and Geneva Switzerland as well as to London, England from November 26th – December 2nd, 2018. The purpose of the trip was to meet with executives of a number of the Swiss financial institutions with a presence in the Bahamas and to host a Bahamas Forum in London for service providers and intermediaries in the UK financial services sector. While in Switzerland one on one meetings were held with officials at UBS Group AG, Credit Suisse Group AG, The Pictet Bank Group, SYZ Bank, Union Bancaire Privee, Gonet Bank & Trust and Safra Bank. The delegation provided updates on The Bahamas’ response to the various international initiatives impacting the financial services sector. It was deemed an opportune time to inform Swiss executives of the measures being taken by the Bahamas to address EU, OECD and FATF matters. Further, they were informed as to the various pieces of legislation slated to be passed during the month of December. The meetings were positive, and the Swiss financial institutions shared their strategies for growth in the Bahamas. Following the visit to Swiss financial institutions, the Bahamas Financial Services Board hosted a forum in London focused on the investment funds and securities industry as well as the overall Bahamas value proposition. The London forum titled “Spotlight on The Bahamas” was held at the Reform Club, London on Thursday November 28th. Delegates attending the event included financial service professionals, advisers and fund managers from all throughout the city of London. Opening remarks were delivered by Minister Symonette who stated that, “Times are different than when The Bahamas financial services industry started over eighty-fiver years ago. We recognize the need to be innovative in our approach in the dawn of uncertainty to display our strength and commitment as a sustainable International Financial Centre. This is essential for The Bahamas as financial services is integral to the sustainability of our economy.” The forum began with a presentation given by Christina Rolle, Executive Director of the Securities Commission of The Bahamas. She provided an in-depth review of the Investments Funds Bill 2018 and the regulatory environment for investment funds in The Bahamas. She also provided an update on the Bahamas’ implementation of the AIFMD licensing regime. This was followed by a roundtable discussion hosted by James Williams, Managing Editor at Hedgeweek. The panel, which consisted of experienced Bahamian legal practitioners: Michael Paton, Head of Corporate & Commercial, Investment Funds, Banking & Securities Group, Lennox Paton, Ryan Pinder, Partner, GTC, Linda Beidler-D’Aguilar, Partner, GSO, Heather L. Thompson Of Counsel, H & J, discussed The Bahamas Value Proposition facilitated a products deep dive outlining the core products and services and explaining the business and operating environment in The Bahamas. Themes discussed included, immigration, fintech, private wealth management, asset management, banking, trust services and the regulatory environment. Tanya McCartney, CEO and Executive Director of BFSB stated: “In light of the various regulatory changes taking place in the sector, it is important that Bahamian professionals and service providers meet and interact with their international institutions and service providers to inform them of what those changes will be and our strategy for the continued growth and development of the financial services sector. In the absence of direct information there is uncertainty which can have a negative effect if left unchecked. Hence, we met directly with executives of the Swiss Financial institutions and hosted an event in the city of London to convey our commitment to adhering to international standards, provide an update on the products and services being offered in the jurisdiction and to articulate the evolving Bahamas value proposition.” During this visit, Tanya McCartney, CEO & Executive Director of BFSB also paid a courtesy call on to the High Commissioner Greenslade at the Bahamas High Commission London who was also in attendance at the London Forum. His Excellency Ellison Greenslade and his wife welcomed BFSB CEO & Executive Director, during which time they exchanged pleasantries and updates relevant to the Bahamas.
The Bahamas government is allocating resources to facilitate the transformation of the financial services sector. The 2018/2019 fiscal budget was passed in the House of Assembly on June 18th, 2018. In his contribution to the budget debate to the Bahamian Parliament, The Honourable T. Brent Symonette, the Bahamas Minister of Financial Services, Trade & Industry and Immigration, unveiled plans to accelerate the pace of Human Capital Development and to improve the Ease of Doing Business. Both initiatives will facilitate a deliberate economic transformation toward a sustainable future for the country’s financial services sector as well as other elements of the Bahamian economy. “We must first be proactive in investing in human capital through education and diversity to achieve service quality that is second to none,” said Minister Symonette. “By improving our talent pool, we will ultimately increase efficiencies in the “ease of doing business” in The Bahamas.” In this regard he said the establishment of a “Centre for Excellence” for professional skills development in financial services in the region is a priority. He stated that, “Through a grant from The European Union (EU) facilitated by The Caribbean Development Bank (CDB) a roadmap was developed to enable us to demonstrate our commitment to educating and equipping our financial services workforce to meet and maintain quality standards in the provision of financial services through the Centre for Excellence. This project is envisioned as a public-private sector partnership to create a financial services “SMART CITY” for education, research and development, and internship.” Minister Symonette added that the Ministry of Financial Services will not onlywork with the Ministry of Education to strengthen financial services education at the tertiary level but also intends to work with the University of The Bahamas to integrate into its business program opportunities for research and internships. Minister Symonette added, “We must realize that although we are an independent and sovereign nation, we exist in an interdependent, and integrated ever-changing global economy. This means that we must embrace and adapt to change this is the only way we will be able to create opportunities for ourselves. He went on to stated that, “We must be innovative in our services and product offering while also putting in the framework for policy, and innovation that will foster flexibility for the creation of new products and services as well as investment in new areas of financial services.” The Minister contended that the Bahamas brand label has to become a label of quality, creativity, innovation and technological advancement. “We live in a knowledge based era, where these things are the key to future advancement. We must develop a Financial Services Technology and Innovation scheme where research centres and innovation libraries can be bred for user experience, data science and machine learning. This is where technological advancement is, it is happening now and we have to embrace it.” The commitment of the government to education as the means for transformation was emphasized when, in closing the debate on the 2018/2019 budget, Dr. The Honourable Hubert Minnis, Prime Minister of The Commonwealth of The Bahamas announced that beginning in September 2019, all full time Bahamian students who meet certain entry requirements for University of The Bahamas will receive free tuition. “This major investment in education will help scores of young people to realize their dreams as we build a more equitable society,” said the Prime Minister. With respect to the ease of doing business, The Minister Symonette noted that said the ease of doing business touches across the whole economy of The Bahamas, but is of particular importance to the financial services sector. “There has been a lot of talk surrounding this issue, but the goal of eliminating unnecessary bureaucratic protocols and practices in our administration for daily business operations is coming to fruition,” he said. According to the Minister, although improvements in the business license process are in its infancy phase, the business license fee for new businesses have already been eliminated over the past year. The Minsiter stated that “Already, we are seeing greater communication between departments where the provision of information between agencies is being streamlined. This has enabled most of the transactions for obtaining a business license to occur in one place.” In outlining some of the improved efficiencies within government, Minister Symonette cited improvements and advances in the Registrar General’s Department, but added that there are plans to increase efficiencies even more to improve processes for turnaround time and accessibility of information. He went on to highlight efforts to streamline the account opening process, when he stated that “We are also looking at amendments to legislation coming from the Central Bank of The Bahamas, around making the process about Know Your Customer, Money Laundering and Terrorist Financing less regimented and more fluid, effectively making it easier to open accounts and transact business.”. In addition to the initiatives outlined above, the government is also engaged in discussions with the Governor of the Central Bank on calls to relax exchange control measures and the Securities Commission of The Bahamas is also making amendments to the Investment Funds Act which will aid in enhancing this service. While taking steps to ensure that there is a cadre of professionals to support the sector and seeking to ensure that persons who choose to do business in The Bahamas do not encounter obstacles, it is apparent in the Minister’s presentation that maintaining the integrity of the jurisdiction also remains a priority for the government. The Minister also emphasized the Government’s commitment to keep abreast and compliant with global financial initiatives. Last year, The Bahamas signed the Convention on Mutual Administrative Assistance in Tax Matters and the Multilateral Convention and Competent Authority Agreement for the OECD’s Common Reporting Standard on the Automatic Exchange of Information. The first exchanges will commence Reporting by The Bahamas for the Standard begins in September of this year. The Bahamas also became a member of the Inclusive Framework for the implementation of Base Erosion and Profit Shifting (BEPS) and is working
