(Jamaica Gleaner) Jamaica plans to develop an offshore company registry as its next step in the process to attract a portion of the funds that flow to International Financial Service Centres (IFSC) like the Cayman Islands, Switzerland, and others.
“The Companies Office of Jamaica (COJ) will establish, operate, and maintain the offshore business registry to facilitate the speedy and efficient registration of these entities,” according to the COJ in its public tender for a consultant issued this week.
The registry platform will be online and available through a web browser, it stated. The remit of the COJ includes managing a database of companies that operate on the island.
According to the tender document, the COJ will act as the procuring agency for the consultant to design the offshore database. The COJ explained that time and staffing constraints have prevented it from building the database in-house.
The database will register entities that meet the requirements of the COJ within the wider context of the IFSC drive.
Success would mean that the island would benefit from attracting a portion of the US$7 trillion (J$10.5 quadrillion) in capital market funds that slush around global centres.
That’s more than 300 times Jamaica’s GDP output, or what it produces in a year.
Consequently, the Government views this as one method to grow the nation’s wealth from the establishment of the Centre. It sees “substantial annual recurring statutory fees” and “significant” employment opportunities for skilled labour.
But it’s a hard sell to convince billionaire trust funds to choose a developing country over developed nations and tax havens.
Offshore business remains a key sector in the neighbouring Cayman Islands. For the first 11 months of 2023, over 9,000 new companies were registered in the Cayman Islands, according to the latest data from the Cayman Islands General Registry. That figure builds on the 119,625 base of companies already registered in the island of just over 71,000 persons. In other words, most of the companies are held by outsiders.
The Jamaican Government, in an attempt to develop the sector, set up the Jamaica International Financial Services Authority (JIFSA), which falls under the Ministry of Industry, Investment & Commerce. It’s tasked with overseeing the sector and operates under the legal mandate of the JIFSA Act passed in 2011. Then in 2017, the Partnership General Act, and the Partnership Limited Act were enacted. Both acts, however, have “not been brought into operation as the requisite supporting regulations are being finalised” according to the COJ document.
Then in 2019, the Trust Act was introduced to modernise existing legislation and redefine the responsibilities of trustees. And in April 2022, the Government has implemented the Trust and Corporate Services Providers Act, along with its associated regulations.
“It is recognised however that beyond regulation there exists the need to strengthen the current infrastructure and resources to facilitate the smooth operation of an industry accustomed to doing business at an exceptionally high standard,” the document stated.
The COJ tender explained that these new local laws comply with international regulatory standards relating to transparency, anti-money laundering, due diligence, the exchange of information, and ongoing supervisory oversight.
“To this end, there has been a renewed effort to develop a coordinated plan to establish Jamaica as an IFSC,” stated the tender.
“The country’s expansion into the International Financial Services Sector – a sector which manages private wealth worth more than US$7 trillion globally, has become a key Government initiative.”