FINANCIAL SERVICES SECTOR UPDATE
New Regulator Expected
As of 1 July 2004, a new regulator is expected to be appointed at the Regulation and Supervision Department. These and other changes are being undertaken in an effort to continue to maintain the outstanding reputation of the island as Nevis moves into new products and services in the international financial services sector. The new regulator will replace Mr. Neville Cadogan, who returned to his homeland of Jamaica following his resignation in March 2004. During the interim period, Mr. Vieoence C. Prentice, Assistant Regulator served in the post as Acting Regulator in the Nevis Financial Services Regulation & Supervision Department.
Results: A Bright Future for the Nevis Financial Services Sector
Initiatives undertaken by the Nevis Development & Marketing Department and the Regulation & Supervision Department has resulted in new legislation for insurance as well as the drafting of legislation for additional products. Furthermore, investors have been expressing their interests in registering a significant number of companies and undertaking other business opportunities in Nevis. To this end, the Offshore Registry is noticing the positive benefits of those assurances.
Evidence of the significant increase in business is seen for the first five months of 2004, where there has been a 27% increase in new registration of IBC’s, LLC’s and International Trusts as compared to the same period in 2003. The results are very encouraging and are attributable in part to the many initiatives undertaken by the Financial Services Department and the Registered Agents on the island.
Additionally, the revenue for 2004 is expected to surpass the amount budgeted for the year. It is therefore apparent that the Nevis Financial Services sector continues to demonstrate viability and vibrancy.
RECENT CONFERENCES/ WORKSHOPS /SEMINARS
1. OECD Global Forum
On 3-4 June 2004, the Premier of Nevis, The Honourable Vance Amory accompanied by Dr. Agatha Jeffers-Gooden represented Nevis at the OECD Global Forum on Taxation held in Berlin, Germany. The meeting was convened to further discuss the process of achieving the objective of a global level playing field based on the high standards of transparency and effective exchange of information in tax matters. The meeting brought together over 100 representatives from 42 governments, both OECD and non-OECD that are committed to that objective.
The meeting focused on specific proposals made by the sub-group of the Global Forum that was established at the Ottawa meeting in October 2003. The proposals set forth a process for moving towards a global level playing field consistent with the objective of high standards of transparency and information exchange in tax matters in a way that is fair, equitable and permits fair competition between all countries, large and small, OECD and non-OECD.
The proposals submitted by the sub-group were broadly endorsed by participants of the Global Forum. It was agreed that the sub-group should continue its work in the compilation of transparency and information exchange practices currently applied by all OECD countries, all non-OECD Participating Partners and significant financial centres that are outside these two groups.
The Global Forum identified financial centres such as Hong Kong, Malaysia, Singapore and others that up to now have not participated in the OECD process and hopes to engage them in dialogue. The next Global Forum meeting is expected to be held in October/November 2005 at which time the outcome of the compilation of current practices in transparency and information exchange will be examined.
2. Meetings of the OECD Sub-Group
Meetings of the OECD Sub-Group on level playing field issues were held on 2 June 2004 just prior to as well as in the margins of the OECD Global Forum in Berlin. The meetings were attended by delegates from Australia, Bahamas, Cayman Islands, France, Germany, Isle of Man, Japan, Jersey, Panama, Nevis, Samoa, the United States and the OECD Secretariat. Representing Nevis were the Premier of Nevis, the Honourable Vance Amory and the Director of Nevis Financial Services Development & Marketing Department, Dr. Agatha Jeffers-Gooden.
The Sub-Group was established at the Ottawa Global Forum meeting held on 14-15 October, 2003. In line with its mandate, the sub-group developed proposals that were put forth for consideration by the Global Forum for achieving a global level playing field and a process by which this work could be taken forward, based on the widely accepted principles of transparency and shared responsibility.
The Sub-Group met on two previous occasions to develop terms of reference for its work and then developed proposals for achieving a level playing field. These proposals were outlined in a position paper entitled "A Process For Achieving a Global Level Playing Field." This paper was presented to the Global Forum where it was discussed and broadly accepted by members of the Global Forum.
The paper is divided into 4 sections, namely:- 1) the introduction, 2) a definition of the Level Playing Field Concept, its features and its role; 3) a process for achieving a level playing field which integrates individual, bilateral and collective elements; and 4) concluding remarks. The paper also contains various annexes, namely:- 1) The Terms of Reference; 2) The Proposed Action Plan for Achieving Transparency & Effective Exchange in Tax Matters and 3) A Draft Sub-Group Template/Questionnaire on Transparency and Exchange of Information.
It is expected that the next meeting of the sub-group will be held during the 1st week in September 2004 to agree on the revised template that will subsequently be distributed and completed by the respective jurisdictions.
3. Tax Competition Seminar held by the Center for Freedom & Prosperity
A Seminar held by the Center for Freedom & Prosperity & the Heritage Foundation, a Washington, DC based think-tank and lobbyist group was held in Berlin on 2 June 2004. The meeting, scheduled to occur the day before the OECD Global Forum featured 10 speakers who discussed the liberalising impact of tax competition and was attended by numerous OECD Global Forum delegates including the Nevis representatives.
4. International Trade & Investment Organisation Meeting (ITIO)
On 3 June 2004, a meeting was held by the ITIO and designed to coincide just prior to the OECD Global Forum. The ITIO, which comprises 16 small and developing nations along with various observers brought together the members to discuss the issue of a level playing field with the aim of developing a unified approach to be presented at the OECD Global Forum as well as the way forward for the respective jurisdictions. Representing Nevis were the Premier & Director of Financial Services.
5. Participation in 5th Annual Euromoney Summit
During the period 25-27 May 2004, Dr. Jeffers-Gooden was among a distinguished group of speakers at the 5th Annual Euromoney Offshore Financial Services Summit held at Simpsons on the Strand, London, England where she spoke on the topic: "After the FATF & OECD De-Listings: A Frank Overview". Dr. Jeffers-Gooden discussed the challenges and opportunities resulting from the de-listings and also used the occasion to promote Nevis financial services and distribute brochures and other promotional material in an effort to generate interest in visiting and doing business in Nevis.
Other expert speakers addressed key issues such as the European Union Directive, the aspirations of the Organisation of Economic Cooperation and Development (OECD), the role of the Financial Action Task Force (FATF) and International Monetary Fund (IMF), changes in anti-money laundering approaches and activities, the U.S Patriot Act, tax treaty developments, professional privilege and client confidentiality.
6. Additional Meetings
During the visits to London and Berlin, the Premier of Nevis and the Director of Financial Services also met with several lawyers and other interested professionals in an effort to enact programmes and measures to enhance the competitiveness of Nevis and attract new investment opportunities to the island.
7. Insurance Training in New York
Mr. Vieoence Prentice, Acting Regulator participated in two Insurance Company Analysis Workshops in New York City during the period 22 – 24 June 2004. The Workshops entitled "Understanding Insurance Company Financial Statements and US Insurance Company Analysis were sponsored by Fitch Training. These and other training received by members of the Financial Services Regulation & Supervision and the Development & Marketing Departments are aimed at maintaining the reputation of Nevis and keeping the island at the forefront of the international financial services sector.
1. Nevis’ Celebration of Two Decades in the International Financial Services Sector
This year, 2004, Nevis is proud to celebrate 20 years in the international financial services industry. A week of activities will take place from 23-27 August 2004. The range of activities includes a financial services awareness event, an awards ceremony to honour persons and companies for their long outstanding contribution to the development of the financial services sector in Nevis. Additionally, a second two-day international financial services conference is slated to take place from the 26-27 August 2004.
2. OECD Sub-Group Meeting
A meeting of the OECD Sub-Group on the Level Playing Field Issues is expected to meet during the 1st week of September 2004 to agree on the revised template that will subsequently be distributed and completed by the participating jurisdictions.
3. Asia Pacific Offshore Institute (APOI) Road Show & Conference
The Asia Pacific Offshore Institute (APOI) will hold a Road Show from 14-15 September 2004 and then a Conference from the 16-17 September 2004 at the Inter-continental Pudong, Shangai, China. Distinguished speakers will talk about the services of the securities industry and securities exchanges in major offshore jurisdictions, tools for financing debt, investment from Asia into Europe and the USA and the use of offshore structures. Updates will also be given on applications of double tax treaties and on new jurisdictions and new tools on tax and asset planning. Nevis will participate in this event.
4. Proposed Road Show to Geneva, Switzerland, 1-5 Nov 2004
Preliminary plans are being made by the Nevis Island Administration to hold a road show in Geneva in conjunction with the Dixcart Group and the Society of Trust and Estate Practitioners (STEP) during the first week of November 2004.
As Nevis celebrates its 20th anniversary in the international financial services sector, it is believed that the many initiatives undertaken by the Government and the service providers on the island over the years have served to shape Nevis as a viable force in the international financial services sector and are expected to continue to solidify and enhance the competitive position of Nevis for the next twenty years.
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