Since the passage of the Financial Services Commission Act in December 2001, which formally created the Financial Services Commission on January 2, 2002, the Commission has operated as the body responsible for the regulation, supervision and inspection of all financial services business conducted in and from within the BVI.
The establishment of the Commission closely followed recommendations published in 2000 by auditing firm KPMG, which identified that a key component of a well-run financial centre is the establishment of an independent regulatory authority.
“It is through the Act that the British Virgin Islands has been able to effectively defend our record as a serious partner in the financial services world,” said Cherno Jallow the current Director, Policy, Research and Statistics of the Commission and one of the principal drafters of the Act while he was the Attorney General of the BVI. “The financial services industry wants certainty both in the application of the law and in the decision-making process as they serve clients. Through the Act and as a Commission, we are able to streamline the rules governing the same activities we regulate in order to ensure a level field in the implementation of financial services legislation.”
Charged with new duties under the Act, the Commission has focused its efforts on promoting public understanding of the financial system and its products. It also has a role to play in helping to reduce financial crime, policing the perimeter of regulated activities, and preventing market abuse.
Recounting its history, the FSC noted that the global financial community has been presented with some extreme challenges over the last decade and every jurisdiction and their respective regulatory bodies have had to be nimble to navigate and solve these challenges. During this time, the Commission and the British Virgin Islands has been no exception, the Commission said.
Marking its anniversary, the Commission highlighted the achievements of the British Virgin Islands over the past ten years, largely due to its work. The Commission observed that the territory:
- Has been included on the Organization for Economic Co-operation and Development’s (OECD) white list (a list that includes jurisdictions deemed to have substantially implemented the OECD standard for transparency and exchange of information);
- Received an excellent report from the Caribbean Financial Action Task Force, the agency which works to implement common countermeasures to address the problem of money laundering;
- Been permitted to list local companies on the Hong Kong Stock Exchange;
- Received a positive assessment from the The Foot Review of British Offshore Financial Centres. (Announced by the UK government in November, 2008 as part of its annual budget review, the Foot review was aimed at identifying “current and future risks in financial supervision, transparency and taxation” and assessing the impact of offshore centres on financial stability);
- Has been recognized by the Financial Action Task Force’s International Co-operation Review Group process for high standards against money laundering and the financing of terrorism; and
- Was the only Offshore Financial Centre to rise in the most recent ranking of jurisdictions by the Global Finance Centres Index.