IoM Has More Pragmatic Regulatory Approach Than UK Says Expert

by Jason Gorringe, Tax-News.com, London

02 July 2003

The Isle of Man has a more 'mature' approach to financial services regulation than the UK in relation to the corporate banking sector, according to a local expert.

Speaking to the Isle of Man Online, Chris Eaton, chairman of the Association of Corporate Service Providers (ACSP) noted a "sharp contrast" in the way that the Isle of Man's FSC and the UK's FSA (Financial Services Authority) go about handling the setting up of corporate bank accounts.

Eaton observed that the situation in the UK is one in which corporate service providers are somewhat "overburdened" with regulation, although he pointed out that this was not unlike the situation the Island found itself in some three or four years ago.

"Now we've experienced that 'first hit' of onerous regulations, there's a more mature approach here in the Island, which is seeing those regulations being interpreted in a sensible and commercially-focused way, rather than the 'knee-jerk' reaction by the banks in the UK, where the FSA, in its strict interpretation of the regulations, has fined more than one high street bank recently for not demonstrating adequate levels of due diligence," Mr Eaton told IoM Online.

"Unlike our UK counterparts, CSPs here are regulated and this allows one regulated entity (the CSP] to introduce business to another regulated entity (the bank] in a less burdensome manner than is currently available in the UK," he added.

The ACSP chairman cited examples such as the requirement for banks in the UK to meet the beneficial owners of accounts face-to-face which can be hugely impractical, given the global spread of many beneficial owners.

Recommended