PRESS RELEASE 19 June 2007
Position Paper on Amendments to Regulatory Legislation
The Commission has today published a Position Paper providing notification of proposed amendments to Regulatory Legislation in preparation for the forthcoming assessment by the International Monetary Fund (“IMF”) of the Island’s regulatory framework.
Jersey, along with the other Crown Dependencies of Guernsey and the Isle of Man, was last assessed by the IMF in 2002/2003 and the resultant report published in October 2003. It is currently expected that each of the Crown Dependencies will be re-assessed in the second quarter of 2008.
In the assessment, the Island’s regulatory framework will be assessed against the relevant international regulatory standards. The assessment will consider legislation, Codes of Practice, policy statements and guidance notes, the practical implementation of the framework by the Commission (and other relevant agencies) – including resources that are available, and input provided by Industry.
One of the themes to emerge from recent IMF assessments is the importance that assessors will place on the practical implementation of legislation and the effectiveness of the Commission’s processes and procedures.
As a precursor to the Island’s 2008 IMF assessment, the Commission has undertaken a comprehensive self assessment exercise - reviewing the Island’s regulatory framework, including practical application of the framework, against the standards set by the international regulatory bodies. The Position Paper sets out necessary changes to Regulatory Laws (primary legislation) and associated Orders (secondary legislation) that have been identified by that self assessment. However, the Position Paper does not consider the results of the self assessment against the Financial Action Task Force 40 Recommendations and 9 Special Recommendations. These are being addressed separately by the Island-wide Anti-money Laundering/Countering the Financing of Terrorism Strategy Group (“AML/CFT Strategy Group”). In addition, the Commission will also be consulting in the near future on proposed changes to Codes of Practice and issuing a position paper in respect of amendments to policy statements and guidance notes towards the end of the year.
The assessment by the IMF will be important for a number of reasons. As already noted, the Island will not be assessed again for another five years, and will not have an opportunity to address any deficiencies that may be highlighted by the IMF in the interim period.
Another reason is that external commentators will use the assessment as the basis for determining whether Jersey is a place with which to do business. The IMF report is also likely to be a factor in future discussions on the development of Jersey’s international personality.
The Commission has issued a position paper rather than a full consultation paper on the basis that the timetable, in which to facilitate changes to primary legislation, is extremely tight and dictates that law drafting instructions are currently being placed with the Law Draftsman’s Office.
Many of the elements of the legislative process are outside of the Commission’s control. These include the need for a Ministerial Decision, States debate and approval of the amendments by the Privy Council. Nevertheless, to place itself in the position of being able to demonstrate practical application of the regulatory framework, the amendments to the Regulatory Laws need to finalised and submitted to the Minister for Economic Development by mid-September 2007.
However, feedback on the policy proposals in this paper is actively welcomed in advance of consultation on the subsequent draft legislative text, which will occur through two separate consultation papers. The first will provide interested parties with an opportunity to comment on the changes proposed to Regulatory Laws whilst the second will provide the same opportunity in relation to Orders. Whilst the actual publication date for the consultation papers is not fixed, it is currently anticipated that the draft legislation relating to the Regulatory Laws will be issued for consultation towards the end of July, with the draft legislation on Orders following slightly later in the year.
As a consequence of the reduced comment period that will be available on the amending legislation, the Commission intends to hold informal interactive briefing sessions either at, or close to, the point of publishing the consultation paper or changes proposed to Regulatory Laws.
The Position Paper can be viewed on the Commission’s website www.jerseyfsc.org and paper copies obtained from the Commission’s reception area or the Jersey Library.
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For further information please contact: -
Andrew Le Brun,
Director, International & Policy
Jersey Financial Services Commission
Tel: + 44 (0) 1534 822065
Fax: + 44 (0) 1534 822001
Notes to Editors
1. “Regulatory Laws” is a collective term used to describe the following laws:
• Banking Business Law (Jersey) Law 1991
• Collective Investment Funds (Jersey) Law 1988
• Financial Services (Jersey) Law 1998
• Insurance Business Law (Jersey) Law 1996
2. The Island’s AML/CFT Strategy Group is chaired by the Chief Executive to the Council of Ministers and comprises officers from the following Government Departments and agencies: the Chief Minister’s Department, the Economic Development Department, the Law Officers’ Department, the Joint Financial Crimes Unit, the Jersey Financial Services Commission, and the Shadow Gambling Commission.