Cayman And Canadian Regulators Sign MoU

by Amanda Banks, for LawAndTax-News.com, London

07 July 2006

The Cayman Islands Monetary Authority (CIMA) and the Office of the Superintendent of Financial Institutions Canada (OSFI) recently signed a memorandum of understanding that will provide a framework for cross border cooperation between the two countries.

The MoU, signed 16 May, establishes a protocol for the sharing of information and protection of information shared, cooperation regarding on-site inspections carried out by one regulator on supervised financial institutions in the other jurisdiction, and ongoing coordination.

OSFI is responsible for regulating and supervising all federally chartered, licensed or registered banks and insurance, trust and loan companies, as well as cooperative credit associations and fraternal benefit societies in Canada.

CIMA General Counsel, Mr Langston Sibblies, noted that the agreement was important since OSFI, as the federal regulator, has jurisdiction in all of Canada's provinces.

"The MoU will allow us to develop cooperative relationships in a structured and clear way and will further enhance supervision of Canadian entities operating here, particularly in the banking sector," he observed.

The MoU is subject to the domestic laws of both jurisdictions, as with other memoranda.

Mr Sibblies continued: "One area of concern for OSFI in negotiating the MoU was the preservation of confidentiality of information that would be provided under the agreement and the assurance that information received would be used for lawful supervisory purposes.

"On examination of our respective legislation we were both satisfied that our laws governing information exchange and deterring financial crime are equivalent. This facilitated the establishment of the MoU."

The Monetary Authority now has bilateral information exchange agreements with eight overseas regulatory authorities, and a multilateral MoU with eight authorities in the Caribbean.

CIMA's Managing Director, Mrs. Cindy Scotland, said this latest agreement underscored the importance Cayman, as a major financial centre, placed on international cooperation.

"The MoU with OSFI again demonstrates our commitment to assist overseas regulators in a manner consistent with Cayman's laws as we pursue our mission of creating a competitive and internationally recognised financial services industry," she stated.

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