The Financial Services Commission (Amendment) Act, 2022 will aim to carry out further reforms to deal with exceptional circumstances that affect the financial services sector. It is designed to ensure a faster process for decision-making, to properly align the provisions of the Act with those of the Financial Services (Exceptional Circumstances) Act, 2020, and to address how banks and insurance companies function during catastrophic natural disasters such as earthquakes, hurricanes, and pandemics, inclusive of their procedures and applied costs.
The proposed reforms will also provide necessary synergy with the provisions of the Virgin Islands Deposit Insurance Corporation Act to address issues concerning banks and other key financial institutions that may fall into financial distress, in order to better protect consumers.
The Financial Services (Fees) Regulations, 2022 will be brought forward and will provide a comprehensive review of all the regulatory fees with the view to enhancing some of the existing fees and, where considered necessary, to introduce new regulatory fees.
The Banks and Trust Companies (Amendment) Act, 2022 will streamline the provisions of the Act with those of the Virgin Islands Deposit Insurance Corporation Act to better address issues relating to banks and other key financial institutions that may fall into financial distress. This will be aimed at ensuring better protection for consumers of financial services business.
The BVI Business Companies (Amendment) Act, 2022 will mainly address issues surrounding struck-off companies, abolition of bearer shares, and record-keeping measures. The reforms will also include amendments to require persons wishing to act as voluntary liquidators of BVI business companies to be either licensed insolvency practitioners or persons resident in the Virgin Islands and holding specific qualifications and skills. Amendments will also be effected to Schedule 1 of the Act by reviewing and, as necessary, enhancing the registry fees regime. The Order effecting such amendments will be laid before the Honourable House in accordance with the requirements of the Act.
The Insolvency (Amendment) Act, 2022 will reduce the inherent conflict between the role of the Office of the Official Receiver and the role of the Commission as the regulator of the financial services sector by transferring the portfolio of Official Receiver from the Financial Services Commission to the Government, under the Ministry of Finance. It will streamline the provisions of the Act with those of the Virgin Islands Deposit Insurance Corporation Act to better address issues relating to banks that may fall into financial distress, where necessary. This will be aimed at ensuring better protection for consumers of financial services business.
The Virtual Assets Service Providers Act, 2022 will introduce new legislation to provide a regime for the registration of providers of virtual assets services and better enhance the Virgin Islands' international obligations to prevent the misuse of virtual assets for money laundering, terrorist financing or proliferation financing purposes.
In addition, appropriate legislative reforms will continue to be carried out to the Anti-money Laundering Regulations, 2008 and the Anti-money Laundering and Terrorist Financing Code of Practice, 2008 to ensure that the Virgin Islands fully meets its technical obligations under the FATF Recommendations in preparation for the CFATF mutual evaluation which is expected to commence later this year. These measures, when completed, will be laid before the Honourable House.
The Financial Services Appeal Board Act will be amended, in particular to address issues highlighted by the pandemic, thus enabling the efficient and smooth running of the appeal process for the benefit of both the Financial Services Commission and appellants.
The International Tax Authority (ITA) proposes amendments to the Mutual Legal Assistance (Tax Matters) Act, 2003 (MLA) and the International Tax Authority Act, 2018 (ITA Act).
The proposed amendments to the MLA are to ensure that the Virgin Islands continue to meet its obligations in relation to exchange of information. The amendment to the MLA will accomplish three important goals as follows:
a. Repeal the European Union Taxation on Savings Income which has now been phased out and replaced with the Common Reporting Standards;
b. reintroduce the Foreign Account Tax Compliance Act (FATCA) requirements in the principal Act, and amend the compliance powers of the ITA to ensure consistency with the FATCA obligations; and
c. provide minor amendments to other provisions of the principal Act to ensure that the Virgin Islands can effectively and efficiently exchange information under various international obligations.
The proposed amendment to the ITA Act will streamline the powers of the ITA, ensuring that the ITA can efficiently and effectively carry out its compliance functions under the Economic Substance (Companies and Limited Partnerships) Act, 2018 and under the MLA.
The Virgin Islands Deposit Insurance Corporation Act of 2016 establishes the Corporation with the legal mandate to be the deposit insurer and resolution authority in the Virgin Islands. As such, the Corporation
is created with administrative and technical autonomy to perform its duties in a manner that benefits the public interest and avoids duplication of functions with the Financial Services Commission (FSC), the regulator and supervisor of financial institutions.
To enable the Corporation's legal mandate, a regulatory framework has already been drafted to bring to life the Deposit Insurance System and the Special Resolution Regime. In the process of building the enabling regulatory framework, opportunities were identified to ensure proper implementation of these two new functions of the VI financial safety net, namely, deposit insurance and resolution.
For entire speech see SPEECH FROM THE THRONE 2022 | Government of the Virgin Islands