HOLOWESKO LAW NEWS
The Nassau Guardian
9th August 2004
"THE BAHAMAS CONTINUES TO INTRODUCE MARKET DRIVEN LEGISLATION
By Bahamas Financial Services Board
In The Bahamas, new legislation continues to be introduced to stimulate further growth and development of the country’s well-established financial services sector.
A Purpose Trust Act, a Segregated Accounts Companies Act, enhancements to the International Business Companies Act and amendments to the Perpetuities Act have all been enacted and represent the latest initiatives in what has become a busy period for legislative developments in The Bahamas. In addition, Bahamas Foundations will be available in September.
This new legislation combined with recent Investment Funds and E-Commerce Acts embodies a legislative direction that is market driven but at the same time recognises international standards.
"The enactment of these pieces of legislation is the result of close public/private sector collaboration and cooperation", says Minister of Financial Services & Investments, Allyson Maynard-Gibson.
"In particular, the members of the Financial Services Consultative Forum, the Association of International Banks Trust Companies and the Bahamas Financial Services Board are to be commended for the many untold hours they dedicated to assist us with legislative developments".
Purpose Trust
Purpose Trusts are now a fundamental planning tool for both private and institutional clients. The enactment of this legislation will allow The Bahamas to attract new types of business since it is a specific type of trust established for non-charitable purposes with no specific ascertainable beneficiaries.
Segregated Accounts Companies (SAC)
The legislation represents an important step forward for the industry since the SAC may segregate its assets into separate accounts which are independent and separate from each other and from the "core" account of the entity.
IBC Enhancements
Amendments to the IBC legislation enhance the attractiveness of a Bahamian IBC as vehicle for many types of financial services businesses. Among the many enhancements are the ability to use an IBC to carry on external insurance and to register mortgages and charges for shares.
Perpetuities Act
Amendments to The Perpetuities Act 1995 enable families to plan for five generations by instituting a period determined by a life or lives in being plus 21 or 150 years.
Leader in Wealth Management
The Bahamas enjoys regional leadership in wealth management, in large part due to the focus on providing high quality services to high net worth individuals at a time when the need for effective wealth management has never been greater.
The recent legislative package ensures that The Bahamas remains at the cutting edge of wealth management. "The Bahamas has significant comparative advantages in the private management sector, and the current transition reflects a fundamental shift in the private banking business as we distance ourselves from low-cost jurisdictions," the Minister says. "We are not seeking to be a bottom feeder in the private banking business. Our aim is to be perceived as absolutely mainstream."
According to the Minister, the desire to be part of this quality club is the reason the jurisdiction is streamlining its banking sector and elimination those institutions that do not measure up to the necessary standards and who are not prepared to invest to meet them.
As a service-based economy, The Bahamas will succeed in its two primary sectors of tourism and financial services by recognising, embracing and nurturing two simple operating principles in everything it does - providing value for money and providing top quality service. These are inter-dependent, not mutually exclusive principles.
The participation by The Bahamas in financial services is viewed as critical to the nation’s economic future. "We are building with this future in mind - we are sustainable, viable hub of finance," says the Minister.
The Ministry of Financial Services and Investments was established two years ago to ensure that the second most important component of the Bahamian economy, after Tourism, has a voice at the Cabinet table."
The Nassau Guardian
Wednesday 19th May 2004
""A HIGHER LEVEL", Central Bank Governor says.
"The regulatory and legislative changes made by The Bahamas in 2000 has propelled the jurisdiction to a higher level in the world of financial services", said the Central Bank Governor, Julian Francis, on Tuesday.
Describing The Bahamas as one of the more significant financial jurisdictions operating in the world of financial services he said that in a number of areas, the country is in a position to compete with some of the best in the world.
He added however that in order for the country to remain a serious contender in international financial services and a jurisdiction that people choose to conduct business in, retaining a reputation as a first class financial centre was of the utmost importance."
The Tribune
April 26th 2004
"NEW LEGISLATION PASSED BY PARLIAMENT
Bills for the IBC (Amendment) Act 2004, Segregated Accounts Companies Act, Perpetuities (Amendment) Act 2004, Trustee (Amendment) Act 2004, Purpose Trust Act 2004 and the Foundations Act 2004 were passed in the House of Assembly in early June."
The Nassau Guardian
Thursday 1st April 2004
NEW FOUNDATIONS BILL
"Another measure in the compendium of legislation aimed to herald The Bahamas as a leading international financial centre was tabled in the House of Assembly on Wednesday.
And when passed, it is believed that The Bahamas will be the first common law jurisdiction to enshrine in its statutes the concept of a Foundation, which has only existed in civil law societies.
Minister of Financial Services and Investments Allyson Maynard-Gibson tabled the much-anticipated Foundations Bill during the morning session. She reminded Members of Parliament of The Bahamas’ attempts to attract business from various Latin American jurisdictions, particularly South America, where the sector advised that the opportunity to expand private banking, investment funds and institutional business "abounds".
"This new and innovative piece of legislation will certainly facilitate and expedite The Bahamas’ ability to attract this new business," she said.
The legislation will facilitate or enable the formation of Foundations by philanthropists, who wish to promote and develop in The Bahamas causes such as culture, education, sports and arts and purposes connected therewith, that might not be considered charities in a legal sense."
BAHAMAS ‘STAR PLAYER’ IN FINACIAL SERVICES
"MIAMI, Florida – The Bahamas was identified as "the only star player" in financial services among sovereign countries of the Caribbean, while British overseas territories such as Bermuda, British Virgin Islands and the Cayman Islands were identified as market leaders, by Andrew Law on Tuesday.
Mr. Law, chairman of the Association of International Banks and Trust Companies in The Bahamas, with over two decades experience in the trust field, explained that these three territories have built their respective businesses by using a proven formula and focusing on non-competing specialist businesses and have built an enviable reputation in the market.
Addressing regional trust practitioners attending a two day International Trusts, Tax Planning and Compliance Forum hosted by Euro-money Seminars, Mr. Law added that even though the business for these jurisdictions is constantly evolving, "both the jurisdictions and the operators within the jurisdiction are reacting well to these developments."
Focusing on The Bahamas, the AIBT chairman said that by concentrating on private wealth management, the jurisdiction found a product that is supported by demand and that did not place the country in direct competition with its neighbours."
The Tribune
Tuesday 16th March 2004
"FOUNDATIONS BILL SET TO GIVE BAHAMAS GLOBAL ADVANTAGE
The Bahamas will be "the only jurisdiction in the world" to offer civil and common law estate planning and asset protection products when it enacts a Foundations Bill, the Association of International Banks and Trusts (AIBT) chairman said yesterday. When the Foundations Bill is passed the Bahamas will be in a "one-service provider" position, able to service wealthy families simultaneously doing business in jurisdictions such as Latin America and North America, with both civil and common law estate planning products.
Foundations are often viewed as the civil law equivalent of trusts, but for clients in those jurisdictions, trusts are less well known and not always acceptable, mainly because trusts often involve the complete surrender to the trustee of legal ownership and control of the settler’s assets. This need not happen with foundations."
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