Legal Framework and Formation Rules and Fees
The Trust Ordinance (1990) sets out the law relating to trusts, and the Trustees (Licensing) Ordinance 1992 provides for the licensing and regulation of trust companies and other professional trustees. The Trustees (Licensing) Regulations 1992 set out the form of the application for obtaining a trustee licence, the categories of trust licences, the details required in an application for a trustee licence, reporting requirements and the rules governing the conduct of licensed trustees. Licensed trustees are required to submit financial returns, appoint auditors and maintain professional indemnity insurance.
The Trust Ordinance (1990) defines a professional trustee as someone who receives remuneration for his services as a trustee, sets out the general requirements for licensing professional trustees, the powers and duties of the Superintendent of Trustees, and miscellaneous provisions regarding liability, confidentiality and the non- application of the Recording of Deeds Ordinance.
Key characteristics of the trusts regime in the Turks and Caicos Islands are as follows:
There is no requirement to register the trust deed or the beneficiaries;
There is no rule against perpetuities;
The trust deed may specify one proper law for interpretation of the terms of the trust deed and another to apply to the administration of the trust assets;
Foreign judgements are excluded;
The Voidable Dispositions Ordinance 1998 sharply circumscribes the circumstances in which a "disposition" can be set aside by a creditor;
Trustees have wide investment powers;
Re-domiciliation of a trust is permitted.
Licenses can be restricted or unrestricted as follows:
A restricted Trustee Licence is issued on the basis of an undertaking by the trustee that it will act as a professional trustee only in respect of a named trust or trusts. An annual fee is payable for this licence.
An unrestricted Trustee Licence is issued without any restriction on which trust or trusts the trustee can act for. A higher annual fee is payable to the Financial Services Commission than for a restricted Trustee Licence. An important requirement in the licensing process is the submission of a Business plan together with full financial disclosure and business references on both the principals and managers of the proposed licensee. The minimum capital requirement was $250,000 at the time of writing. Many professional firms consider a trustee licence to be an appropriate and cost effective alternative to a banking licence.
The Trustees Licensing Exemption Order 1992 exempts the following entities:
A company which is the trustee of a single trust and the issued share capital of which company is entirely beneficially owned by one or more of the beneficiaries, the settlor or by a combination of the beneficiaries and settlor. Family trust companies sometimes fall under this category;
A company which is the trustee of a single trust and which has its registered office in an approved jurisdiction;
A company which acts as a bare trustee with no interest in or duty to the trust property except to convey it when directed by the beneficial owner.
Most functions relating to the licensing, review and regulation of trusts are carried out by the Superintendent of Trustees based at the Financial Services Commission.
In common with many other offshore jurisdictions, the Turks and Caicos Islands responded to pressure from the OECD by tightening up regulations. Specifically, the Turks and Caicos responded to the recommendations of the November 2000 KPMG Independent Review of Financial Sectors in the Caribbean Overseas Territories.
After the Turks and Caicos Islands were named on the Organization of Economic Cooperation and Development (OECD) 'grey list' of territories which have committed to, but yet to implement, the agreed international standard on tax transparency, the jurisdiction set about signing a number of Tax Information Exchange Arrangements (TIEAs), including with the United Kingdom, on July 22, 2009. The Turks and Caicos Islands were removed from the 'grey list' and placed on the 'white list' in December 2009 after having signed a dozen TIEAs.
Turks And Caicos Relaxes Immigration Rules /5/2010/18
The Turks and Caicos Islands government has announced that it has relaxed immigration rules on short-term visitors to the island.
Caribbean Explores Fiscal Cooperation /3/2010/9
Ahead of the World Bank meeting, to be held on March 11-12, where CARICOM Finance Ministers will meet to discuss challenges that the region faces, CARICOM Secretary General, Edwin Carrington said it was vital for Caribbean economies to increase economic cooperation and remove fiscal barriers, for the prosperity of the region going forward.
OECD Reports On Its Progress With International Tax Standards /1/2010/20
According to the Organization for Economic Cooperation and Development, the focus of the Global Forum on Transparency and Exchange of Information is now shifting – from commitments and agreements to achieving an effective implementation of the standards.
Turk And Caicos Islands Removed From 'Grey' List /12/2009/29
The Turks and Caicos Islands have been placed on the OECD ‘white list’ of compliant territories, having signed 12 agreements on tax information exchange, thereby substantially implementing the internationally agreed standard on transparency and information exchange.
Crown Dependencies Welcome Foot Report Findings /11/2009/2
The British Crown Dependencies have welcomed the findings of the UK government's review of the dependencies, published on October 29, which recognizes their economic benefit to the United Kingdom, and efforts to achieve compliance with international standards.
UK Signs TIEA With Turks And Caicos /7/2009/28
A Tax Information Exchange Arrangement between the United Kingdom and the Turks and Caicos Islands was signed in London on July 22, 2009 - the first of three such agreements signed by the Caribbean jurisdiction's government that day.
The Netherlands Signs TIEAs With Anguilla And Turks /7/2009/27
Dutch Secretary of State Jan Kees De Jager (pictured) has welcomed agreements for the exchange of tax information between the Netherlands two Caribbean territories, signed on July 22.
Ireland Signs TIEAs With Anguilla, Turk And Caicos Islands /7/2009/24
Ambassador of Ireland to the United Kingdom, Bobby McDonagh, signed Tax Information Exchange Agreements with Anguilla and the Turks and Caicos Islands on behalf of Ireland, in London on July 22, 2009.
E-Commerce Solutions Continue To Flourish In Caribbean /7/2009/23
First Atlantic Commerce, a leading international multi-currency payment and risk management solutions provider, and Scotiabank, an international bank based in Canada and the leading bank in the Caribbean, have joined together to offer 3-D Secure services to online merchants in seven countries across the English-speaking Caribbean.
World Bank Study Provides Overview Of Caribbean Global Trade Integration /4/2009/14
The acceleration of trade integration in the Caribbean is essential to boost the region’s growth, create jobs, and reduce poverty, says a new World Bank study. The report argues that despite their small size, economies in the Caribbean must strive to become more competitive to fully reap the benefits of global trade integration.