Vanuatu News | Increase of Bond and other changes for Brokers and IBCs
This Announcement intends to inform our clients that the Dealer in Securities Act of Vanuatu as well as the Act on International Companies, has been amended on 16 June 2017. Altogether, 13 laws have been either passed or amended, all with the aim of compliance with AML/CTF standards as set by the Financial Action Task Force (FATF).
Changes on the Dealer in Securities Act
To certain extent, these are good news for Vanuatu Dealer in Securities Companies since it will help to enhance Vanuatu profile as a safe and compliant OFC destination.
Therefore, as of 16 June 2017 all dealer in securities companies have to respect the following regulations:
- The International Companies Act (as amended), you may find the new Act here; and
- The Dealer in Securities Act (as amended), you may find the new Act here.
These companies have also to respect every laws and regulations of the countries in which they perform activities.
We would like to draw your attention to the following main changes:
- the increase of the bond which has been decided by the regulator. The Bond amounts now to VATU 5,000,000 (50.000 USD) for every new application and has now to be paid to the Vanuatu Financial Services Commission and not to the Supreme Court of Vanuatu anymore;
- the insertion of the KYC requirements which includes the filing of at least the following documents (non exhaustive list)
- Details of the source of the funds used to pay the capital (new requirement)
- Notarized Police clearance and passport of the applicant
- Details of the business plan
- Details on effective beneficial owner
The new law is a bit unclear about the situation of current licensed companies for which a dealer in securities license has already been granted as the notion of “renewal” still does not exist.
It is so far understood that all current holders of a VFSC licence have to comply with the new additional information provisions of the law within a period of maximum 6 months following the Gazette Date of the law (16 June 2017). However, the law is silent on whether these companies already licensed and incorporated have to respect the new bond requirement.
We are in the process of clarifying these points with Vanuatu Financial Services Commission and the Minister of Finance and we will inform our clients of the VFSC’s position.
Changes on the International Companies Act
According to the new changes, and according to an announcement of the VFSC Registration Department dated July 7th, 2017, each International Company needs to pay its renewal fees to the VFSC before 30 June of each year. The VFSC is of the view that the renewal process shall also apply to companies incorporated on 2017, which means that a company incorporated between January 2017 and June 2017 shall also pay its Annual “renewal” fees on June 2017 in order to be legally registered.
Despite some expressed disagreements with this approach, the opinion of the VFSC is for the moment strict about this and possibilities to contest the interpretation of the regulator are also limited.
Due to the exceptional circumstances, the VFSC has allowed an extension of deadline of 14 days (starting from the 5th of July 2017), meaning that in order to be consistent with VFSC approach and avoid any registration issue with them, International Companies registered in Vanuatu have to pay the Annual Fees before 19 July 2017.