OECD compliance a highlight of BFSB 2010 calender
CEO and Executive Director of the Bahamas Financial Services Board(BFSB)Wendy Warren toldGuardian Businessyesterday that the March 20th achievement of full compliance with the G20/Organization for Economic Cooperation and Development’s(OECD’s)standard on Transparency and Cooperation in Tax Matters could be used as a marker to segment the board’s achievements and efforts this year.
“Prior to this time and for the better part of the 2009, our activities were focused on communication with government, financial services institutions and client advisors on matters related thereto,”Warren said.”While achieving the standard was critical, the work around this subject matter continued throughout 2010.”
The OECD introduced the standards in the 1990s and by 1998 pursued The Bahamas and around 40 other countries to adopt them, with consequences attached to non-compliance. The standards call for an exchange of forseeable, relevant information to allow the requesting country to administer or enforce its domestic tax laws. The result was that The Bahamas now has 22 tax information exchange agreements(TIEAs)signed with other sovereign states.
“The BFSB continued to support the need to secure appropriate benefits arising from these bi-lateral arrangements,”Warren said.”Benefits proposed by the industry include the conclusion of investment protection agreements, removal in the law and policy of negative consequences arising from the conduct of business through Bahamas entities… and benefits available in double taxation agreements.”She added that the Canadian TIEA’s benefits to The Bahamas were comparable to those it would provide in a double taxation agreement.
Legislatively, the industry saw the passage of several bills into law, and the most critical piece of legislation, the proposed Securities Industry Act(SIA), was tabled for debate in Parliament this December. The board coordinated consultation with the SIA working group, the government and the Securities Commission of The Bahamas, according to Warren. She said if enacted the bill will allow greater cooperation with other financial centers and will be both a compliance and a business development tool.
“Business development legislation remained a priority with proposed amendments to the Trustee, Perpetuities and Purpose Trust Acts along with the introduction of the Bahamas Executive Entity, showcasing pent up demand for the continual refinement of our legislative toolkit,”Warren said.
This year also saw the passage into law of the Arbitration Act 2009 and Arbitration(Foreign Arbitration Awards)Act 2009, the External Insurance Act 2009/External Insurance Regulations 2010, the IBC(Amendment)Act, 2010, the Business Licence Act 2010, the International Tax Cooperation Act 2010, and the Probate and Adminstration of Estates Act 2010.
According to Warren, a blueprint was established to guide the industry to greater success and sustainability this year. SCRIPT(Strategy, Coordination, Regulation, Infrastructure, Proactivity and Talent)was issued jointly by the Government of The Bahamas and the BFSB.
“SCRIPT provides an analysis of the position of The Bahamas in many areas of the global financial services sector, the quantifiable benefits to be achieved if certain steps are taken and the constraints to be addressed if the requisite framework for an international business and finance center is to be achieved,”Warren Said.”SCRIPT should set the course of prioritizing action necessary to improve industry competitiveness and contribution to the economy of The Bahamas.”
The BFSB also saw some 20 marketing initiatives this year, and Warren noted the most important advancement was the active coordination with the Bahamas Investment Authority, the Bahamas Maritime Authority and the Grand Bahama Port Authority.