IoM To Amend Financial Services Act

by Jason Gorringe, Tax-News.com, London

09 March 2011

The Isle of Man’s Financial Supervision Commission (FSC) has announced the first proposed amendments to the Financial Services and Collective Investment Scheme Acts since their inception in 2008.

In a consultation paper released on March 4, the Commission said that amendments are proposed as a result of recommendations made by the International Monetary Fund in 2009, as well as a few other changes to assist industry, to improve clarity and to correct anomalies.

According to the FSC, it is proposed that the Financial Services Act 2008 (FSA08) and Collective Investment Schemes Act 2008 be amended to:

• Protect the use of ‘sensitive’ terms, such as the use of ‘bank’ in company names;
• Increase the powers of the FSC to provide oversight of non-regulated institutions, to enable the authorities to decide whether they should be brought under the remit of the FSC’s supervision;
• Remove the requirement on ‘F Register’ companies (those with places of businesses abroad in addition to in the Isle of Man) to be licensed if they are not conducting licensable activity;
• Remove the requirement on the FSC that legislation specify the content of forms;
• Update the requirements for Authorised Schemes to allow regulations to specify functionary requirements including place of business;
• Improve consistency in indemnity provisions;
• Introduce a consultation requirement on the Commission when proposing regulations under the FSA08;
• Expand the FSC’s remit to include ‘promoting the stability of the financial system’;
• Broaden the FSC’s powers with respect to warning notices;
• Remove the restriction on Authorised Schemes’ functionaries’ place of business;
• Enhance the transparency of gateway arrangements;
• Permit the transferal of funds between licensed deposit-takers without the need for parliamentary approval;
• Provide the FSC with greater powers to enable it to issue warnings on directors, controllers and key persons who are deemed not ‘fit and proper’.

Responses to the proposals must be submitted by April 15, 2011.

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