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OECD lists recommendations to increase compliance

Although The Bahamas was rated as largely compliant with the international standard on transparency and the exchange of information in a peer review by the Organisation for Economic Cooperation and Development’s (OECD) Global Forum on Transparency and Exchange of Information for Tax Purposes, the international body has compiled a list of recommendations to address areas of improvement.

Despite the positive review, the OECD Peer Review Report on the Exchange of Information on Request – which was last conducted in 2013 and is conducted every three years – found that the amount of issues identified where improvements are needed has increased.

The most glaring issue is the legal requirements in respect of the availability of beneficial ownership information, which do not cover all relevant entities and arrangements.

Improvements are also needed in respect of the oversight on the obligations to keep legal ownership and accounting information, the report states.

As a result the global forum has recommended that The Bahamas monitors its business community, in particular executive entities, to ensure all persons carrying out trusts in The Bahamas are under supervision.

The forum also recommended that, with respect to international business companies (IBCs), The Bahamas should monitor the legal ownership information of liquidated IBCs, as well as monitor the accounting information of those entities even if they have been dissolved or struck off the register, for a minimum period of five years in all cases.

It also recommended simplified due diligence in respect of investment funds.

“In order to increase the reliability of this information, it is recommended that The Bahamas clarifies that simplified due diligence should only be applied in respect of investment funds where appropriate,” the report states.

“It is recommended that The Bahamas introduce a legal requirement for protectors of trusts with a Bahamian trustee or otherwise administered in The Bahamas to be identified in all cases.”

According to the report, the issues identified have not had, or are unlikely to have more than a negligible impact on the exchange of information on request, however there may be concern that circumstances may change, leading to an increase in the relevance of the issue.

In a statement released on Monday the Ministry of Finance pointed to recent steps to maintain compliance, including the tabling of the Registration of Beneficial Ownership Bill, 2018; the signing of the Convention on Mutual Administrative Assistance in Tax Matters and the signing of the Multilateral Competent Authority Agreement.

Paige McCartney

Business Reporter at The Nassau Guardian
Paige joined The Nassau Guardian in 2010 as a television news reporter and anchor. She has covered countless political and social events that have impacted the lives of Bahamians and changed the trajectory of The Bahamas.
Paige started working as a business reporter in August 2016.
Education: Palm Beach Atlantic University in 2006 with a BA in Radio and Television News
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