Press Statement following the official publishing on the Global Forum Peer Review Report on Barbados by Minister of International Business and Industry, Ronald Toppin
On April 6, 2020, the Global Forum on Transparency and Exchange of Information for Tax Purposes (Global Forum) officially published on the Global Forum’s website, a peer review report assessing Barbados’ compliance with the Global Forum’s Exchange of Information on Request standard.
Basically, this standard stipulates that, in relation to transparency, beneficial ownership information (meaning information as to who an entity’s real shareholders are) must be available for all legal persons and legal arrangements. This information is to be kept at the company’s registered office.
It also further stipulates that, in relation to the exchange of information, a country is only considered to be meeting the standard when reliable information, “foreseeably relevant” to the tax requirements of a requesting jurisdiction is available, or can be made available, in a timely manner and there are legal mechanisms that enable the information to be obtained and exchanged.
Also of significance, is the fact that it is not enough to have laws in place but the standard requires that there be a regular and comprehensive system of supervision and oversight to ensure that all entities and arrangements are complying with the obligations of the standard including the requirement to maintain legal and beneficial ownership information at their registered offices.
The just concluded review focused on the three-year period, July 1, 2015 to June 30, 2018. Except for the single month of June 2018, this period preceded the current Administration which took up the reins of government at the very end of May, 2018.
Of the ten (10) elements reviewed, three (3) received a Partially Compliant rating, one (1) received a Largely Compliant rating and six (6) were found to be (fully) Compliant. This resulted in an overall rating of Partially Compliant by the Global Forum. Background information is very relevant here.
In 2015, under the last Administration, Barbados was assessed by the Global Forum in relation to the development of its legislation, and regulatory framework, for transparency and the exchange of information as well as its practical monitoring and supervision of the implementation of that framework in compliance with the standard. It was found to be Partially Compliant. Barbados requested a review in 2016 and was then found to be Largely Compliant.
Significantly, however, although Barbados was found to be Largely Compliant, there were some deficiencies that Barbados was made aware of and required to address by June, 2018 if it wanted to maintain that Largely Compliant rating or move even higher to a Compliant rating. These included the need for legislative changes and for ensuring adequate monitoring of the practical implementation by entities of the requirements of the standard.
The last Administration failed to address a number of these issues by June, 2018 and that has resulted in the Partially Compliant rating Barbados just received.
And it is important to note that this rating was prescribed despite the best efforts of the current Administration because, during the course of last year, this Administration went to Parliament and amended the Companies Act, the Corporate and Trust Services Providers Act, the Limited Partnerships Act and the Societies with Restricted Liability Act. It also repealed the Foundations Act. All of this was to have been done by the last Administration by June, 2018.
In addition, and just as, or more, important, we have brought a significant number of companies under the purview of Corporate and Trust Service Providers so that they can be more effectively monitored for compliance with the requirement to have accurate and up-to-date beneficial ownership information.