BACKGROUND ON THE OFFSHORE INDUSTRY IN BELIZE
an English-speaking country in the heart of Central America, is
a relative newcomer in the field of international financial services.
Since attaining independence from Britain in 1981, Belize has been
endeavoring to diversify its economy away from the agricultural
sector. Belize, therefore, saw the international financial services
sector as a window of opportunity where it could seek to achieve
competitive advantage. Belize also earns a substantial income from
the tourism sector.
1989, the enactment of the Registration of Merchant Ships Act which
constituted an open ship registry, gave birth to the International
Merchant Marine Registry of Belize (IMMARBE). Today, more than 3000
vessels fly the Belizean flag and there is a network of IMMARBE
offices around the world. Belize has ratified most of the International
Maritime Organisation Safety Conventions.
1990, Belize enacted the International Business Companies Act based
on the British Virgin Islands model. In a short space of ten years,
Belize has registered more than 15,000 IBC's. Belize's IBC legislation
is viewed internationally as one of the most modern and user-friendly.
It is particularly designed with the offshore investor in mind.
A Belizean IBC is an ideal corporate vehicle for international financial
transactions and allows the investor to engage in a wide variety
of activities ranging from asset protection to operating bank accounts,
brokerage accounts, ship ownership, commission arrangements and
various other commercial transactions.
IBC legislation was supplemented in 1992 with the enactment of a
Trusts Act which provides for both onshore and offshore trusts.
Universally acknowledged as one of the best in the field, Belize's
trust law contains provisions that are specialty designed to meet
the needs of differing and diverse cultures and religions.
further expanded its offshore sector in 1996 with the passing of
the Offshore Banking Act. This provides for two categories of offshore
banking licences - the Unrestricted "A" Class and the
Restricted "B" Class licence. The holder of a "B"
Class licence maintains lesser capital and is restricted to conducting
certain limited business activities only.
election of a new Government in Belize in 1998 provided fresh impetus
to the development of the offshore services sector. A spate of seven
offshore industry measures were added to the statute book in 1999.
the International Financial Services Commission Act which seeks
to promote, protect and enhance Belize as an international financial
services center and to regulate the provision of international
the International Insurance Act which provides for the regulation
of persons establishing and carrying on international insurance
the Protected Cell Companies Act which allows for the incorporation
of protected cell companies or the conversion of an existing
company to a protected cell company;
the Mutual Funds Act which provides for the regulation, authorisation
and control of mutual funds and their managers and administrators;
the Limited Liability Partnerships Act which permits the creation
of limited liability partnerships;
the Retired Persons (Incentives) Act which offers certain tax
exemptions and incentives to qualified retired persons;
the International Business Companies (Amendment) Act which provides
for the establishment of limited life companies.
now offers a full menu of investment vehicles designed to meet the
needs of sophisticated investors around the world. As the range
of services has widened, Belize has become a more convenient place
to do business. It has truly become a 'full service' jurisdiction
- 'a One-Stop Shop' (as it were).
developing its Offshore sector, Belize has not overlooked the fact
that the offshore vehicles may be used by unscrupulous elements
to launder the proceeds of drug trafficking or other illicit activities.
Simultaneously with the enactment of the Offshore Banking Act in
1996, Belize also passed the Money Laundering (Prevention) Act which
established mechanisms and procedures to ensure that the country's
financial institutions are not used to disguise the source of illicit
funds. This Act is central to the country's strategy to develop
a reputable and viable offshore services sector. It is virtually
an 'all crimes' law and is not limited to drug related offences.
The definition of 'money laundering' is extremely wide and covers
'engaging, directly or indirectly, in a transaction that involves
property that is the proceeds of crime, disguising, disposing of
or bringing into Belize any property that is the proceeds of crime,
knowing or having reasonable cause for believing the same to be
the proceeds of crime.'
Belize's banking sector (including offshore banking) is regulated by the Central Bank of Belize, while the non-banking sector falls within the jurisdiction of the International Financial Services Commission (IFSC) established in 1999. Membership of the IFSC includes representation from both public and private sectors. The present membership of the IFSC is as follows:-
(1) Mr. Joseph Waight
Financial Secretary - Chairman
(2) Mr. Gian C. Gandhi
Director General - Deputy Chairman
(3) Mr. Glenford Ysaguirre
Governor, Central Bank of Belize
(4) Mrs. Marilyn Williams
Director, Financial Intelligence Unit
(5) Solicitor General
(6) Mr. Christopher Coye
(7) Mr. Rodwell Williams
(8) Mrs. Lizette Ortiz
(9) Mr. Philip Johnson
(10) Mr. Naim Musa
IFSC' mandate includes:
and developing Belize as a center for international financial
protecting and enhancing the reputation of Belize as an offshore
providing appropriate supervision and regulation of international
formulating policies and providing advice and assistance to
the government on the regulation of such services;
collecting, storing and disseminating reliable and timely information
to interested parties on changes and new trends in these services.
Commission relies on self-regulation, meaning that while government
sets overall standards, it expects much of the actual work in terms
of monitoring and compliance to be done by the industry itself.
Commission has recently issued licensing regulations to licence
all international financial services providers. The licensing process
is designed to ensure that only 'fit and proper persons' are allowed
to provide, carry on or transact international financial services
in or from within Belize. The application fee is US$500.00 while
the annual licence fee is US$2,500.00. In addition, the Commission
is developing a statutory Code of Conduct for international financial
services providers, to ensure compliance with internationally-accepted
best practices by all services providers.
is an active member of the Caribbean Financial Action Task Force
(CFATF) and subscribes to its core principles to eradicate money
laundering and to foster stability in the global financial system.
Belize has also made a commitment at the political level to adhere
to the objectives of the U.N. Offshore Forum on Money Laundering.