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Nadia J Taylor Associate. PRIVATE TRUST COMPANIES Establishing a PTC and Acting as a Registered Representative. A PTC can be either: an IBC; or a Domestic company. HOW IS A PTC ESTABLISHED?.

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Presentation Transcript
incorporating a new ptc
The name of a PTC cannot include words such as “Trustee”, “Trust Company” or “Private Trust Company” without the prior approval of Central Bank. INCORPORATING A NEW PTC
memorandum and articles of association
Minimum Capital Requirement - $5,000.

Specific objects and purposes.

Designated Persons or Designated Person.

Special Director.

Registered Representative.

MEMORANDUM AND ARTICLES OF ASSOCIATION
memorandum and articles of association6
Objects and Purposes of a PTC

“to act as trustee only for a trust created or to be created at the direction of a Designated Person or Designated Persons.”

MEMORANDUM AND ARTICLES OF ASSOCIATION
designated person or persons
A Designated Person(s) is an individual or individuals described as such within the Designating Instrument provided that if more than one each Designated Person must be related to the Designated Person so described by consanguinity or some other family relationship. DESIGNATED PERSON OR PERSONS
designated person or persons8
A Designated Person may be deceased.

The names of the Designated Person(s) will not be a part of the memorandum and articles of association.

DESIGNATED PERSON OR PERSONS
special director
A PTC must have one Special Director with:

knowledge of trust administration; or

five years experience in a discipline relevant to trust administration which includes one or more of law, finance, commerce, investment management or accountancy.

SPECIAL DIRECTOR
what is a registered representative rr
Must be either:

A licensee of the Central Bank; or

A Financial and Corporate Services Provider (duly licensed under the Financial and Corporate Services Provider Act, 2000).

Restricted only to the business of a PTC.

WHAT IS A REGISTEREDREPRESENTATIVE (RR)
functions of a rr
A RR may provide the services of:

Secretary;

Director; or

Bahamas Agent.

Where a RR acts as a Bahamas Agent for a PTC, it must enter into a service agreement to provide administrative services to the company.

FUNCTIONS OF A RR
registered representative rr
A licensed FCSP wanting to act as a RR must:

Apply to the Central Bank for written approval of the Governor to act as a RR;

Engage in RR services through a subsidiary company (Regulations 6(1)).

REGISTERED REPRESENTATIVE (RR)
registered representative rr14
The Governor of the Central Bank may approve or deny an FCSP seeking to be a RR based on:

The fitness of the FCSP.

The business record and relevant experience of the FCSP or its beneficial owners.

REGISTERED REPRESENTATIVE (RR)
registered representative rr16
A RR must be resident in The Bahamas and maintain a minimum share capital of $50,000.

The fee payable to the Public Treasury to act as a RR of a PTC is $2,500 annually.

REGISTERED REPRESENTATIVE (RR)
registered representative rr17
A RR is the main point of contact for the Central Bank in relation to PTCs.

A RR is required to verify the identities of :

the settlor and any person providing the funds or assets which are subject to the trust;

REGISTERED REPRESENTATIVE (RR)
registered representative rr18
The Designated Person;

The Protector of any trust in which the PTC is a trustee;

Vested beneficiaries of any trust of which a PTC is a trustee.

REGISTERED REPRESENTATIVE (RR)
registered representative rr19
RR must maintain the following books and records at its office in The Bahamas:

Memorandum and Articles of Association;

Designating Instrument;

CV of Special Director;

REGISTERED REPRESENTATIVE (RR)
registered representative rr20
Trust instruments for each trust;

A list of all the PTCs of which a RR acts;

The “Form of Acknowledgement to be executed by the settlor of the trust ” (to be produced where possible).

REGISTERED REPRESENTATIVE (RR)
designating instrument
[INSERT COMPANY NAME]

I, [DIRECTOR], hereby confirm that in relation to [INSERT COMPANY NAME] a Company [incorporated/to be incorporated] under the laws of The Bahamas, the Designated Person or Designated Persons for the purposes of Section 2 of the Act shall be: [INSERT INDIVIDUAL (S) NAME (S)].

Signed:

DIRECTOR

Acknowledged by:

[INSERT COMPANY NAME]

DESIGNATING INSTRUMENT
form of acknowledgement to be executed by settlor of trust
I, [INSERT SETTLOR’s NAME], hereby acknowledge that in relation to [INSERT COMPANY NAME] (the “Company”) a company [incorporated/to be incorporated] under the laws of The Bahamas:

that the Company’s directors are not required by law to possess or exhibit expertise in trust administration and, therefore, said directors may, in fact, not be possessed of or exhibit such skill,

that Company is not required by law to provide any fidelity bond,

FORM OF ACKNOWLEDGEMENT TO BE EXECUTED BY SETTLOR OF TRUST
form of acknowledgement to be executed by settlor of trust23
that the capital of the Company is not required by law to exceed Five Thousand Dollars and may, therefore, be minimal; and

that Company is not required by law to perform an annual audit.

Accordingly, accepting the foregoing and fully understanding the legal implications hereof, I hereby waive any and all rights of complaint in respect of these matters.

Signed:

Settlor

Acknowledged by:

FORM OF ACKNOWLEDGEMENT TO BE EXECUTED BY SETTLOR OF TRUST
requirement of a licence
BTCRA section 3(2):

“No trust company shall carry on trust business from within The Bahamas whether or not such business is carried on in The Bahamas unless it is in possession of a valid licence granted by the Governor authorising it to carry on such business.”

REQUIREMENT OF A LICENCE
qualifications of exemption
A PTC is exempt from the requirements of section 3(2) of the BTCRA if:

The PTC complies with the definition of a “private trust company” under the BTCRA as amended;

It has a single Designating Instrument;

It does not solicit trust business

QUALIFICATIONS OF EXEMPTION
qualifications of exemption26
Upon appointment as a RR of a PTC, a RR has a duty to certify to the Governor of the Central Bank that the PTC meets the requirement for exemption from section 3(2) of the BTCRA either:QUALIFICATIONS OF EXEMPTION
qualifications of exemption27
Within six (6) months of the date of coming into force of the Regulations; or

If a PTC is either an IBC or Domestic Company incorporated after the date of coming into force of the Regulations, within three 3 months of its incorporation.

QUALIFICATIONS OF EXEMPTION
how does a rr certify exemption
A RR certifies exemption by obtaining from the directors of each PTC for which it provides services a duly completed Compliance Certificate in the form set out in the Fourth Schedule to the Regulations. HOW DOES A RR CERTIFY EXEMPTION?
how does a rr certify exemption29
The Certificate should be accompanied by a briefing sheet on each PTC containing the name of the settlor and a list of trusts to be administered by the PTC.

A RR must obtain a duly completed Compliance Certificate on, or before 31st December of each year.

HOW DOES A RR CERTIFY EXEMPTION?
compliance certificate
We, the undersigned directors (the “Directors”) of [COMPANY NAME], a Private Trust Company

established under the laws of the Commonwealth of The Bahamas pursuant to the Banks and Trust

Companies Regulation Act, 2000 (the “Company”) hereby declare that between [DATE] and [DATE]:

1. The Company has served only as trustee for trust or trusts for Designated Person or Designated

Persons or an individual or individuals who are related by consanguinity or other family relationships to

the Designated Person or Designated Persons and has not carried on any business or activity which

was prohibited; and

COMPLIANCE CERTIFICATE
compliance certificate31
2. The Directors have acted honestly and in good faith with a view to the best interest of the

Company.

And we each make this solemn declaration conscientiously believing it to be true.

________________ __________________

Director Director

COMPLIANCE CERTIFICATE
applicable fees costs
Establishment and Maintenance of the PTC

Fees due on commencement $5,000

Annual Fee $5,000

Registered Office/ Agent $? (discretionary)

Establishment of a RR

Application to act as RR $2,500

Annual fee. $2,500

APPLICABLE FEES & COSTS
applicable fees costs33
Provision of RR services

Fees for acting as:

(i) secretary; (ii) director; or

(iii) Bahamas Agent. $? (discretionary)

Establishment of Trusts

Fees for:

drafting a trust deed; and $?

establishing a trust. $? (discretionary)

APPLICABLE FEES & COSTS
other ways of establishing a ptc
Converting an existing IBC or Domestic Company into a PTC.

Converting a restricted licence Trust Company into a PTC.

Converting an existing Foreign Company into a PTC.

OTHER WAYS OF ESTABLISHING A PTC
questions
QUESTIONS?

Nadia J TaylorAssociatentaylor@higgsjohnson.com