DRAFT PROCEEDS
OF CRIME (AMENDMENT OF SCHEDULE 2) (JERSEY) REGULATIONS 200- (P.119/2008):
AMENDMENTS
1 PAGE 7, REGULATION 1 –
In paragraph
(b), in the inserted paragraph 3, delete sub-paragraph (1)(d).
2 PAGE 8, REGULATION 1 –
For paragraph
(c), substitute the following paragraph –
“(c) in paragraph 4 –
(i) for sub-paragraph (a)(i) there shall
be substituted the following clause –
‘(i) paragraphs 1, 3B, 3C, 4, 10, 14, 15, 18A
and 21,’;
(ii) after sub-paragraph (a)(iv) there
shall be inserted the following clause –
‘(v) paragraph 18, where the relevant special
purpose vehicle is provided with any service that falls within Article 2(3) and
(4) of the Financial Services (Jersey) Law 1998 by a person registered under
that Law to carry on trust company business;’;
(iii) after sub-paragraph (c) there shall be
inserted the following sub-paragraphs –
‘(ca) excluding special purpose investment business
carried on in accordance with the exemption set out in the Financial Services
(Investment Business (Special Purpose Investment
Business – Exemption)) (Jersey) Order 2001 by a person who –
(i) is acting as a functionary within the
meaning of that Order, and
(ii) is provided with any service that falls
within Article 2(3) and (4) of the Financial Services (Jersey) Law 1998 by
a person registered under that Law to carry on trust company business or is
provided with any service within fund services business (within the meaning of
that Law) by a person who is registered under that Law to carry on fund
services business;
(cb) excluding restricted investment business
carried on in accordance with the exemption set out in the Financial Services
(Investment Business (Restricted Investment Business – Exemption))
(Jersey) Order 2001 by a person who –
(i) is acting as a functionary within the
meaning of that Order, and
(ii) is provided with any service that falls
within Article 2(3) and (4) of the Financial Services (Jersey) Law 1998 by
a person registered under that Law to carry on trust company business or is
provided with any service within fund services business (within the meaning of
that Law) by a person who is registered under that Law to carry on fund
services business;’;
(iv) for sub-paragraph (f) there shall be substituted
the following sub-paragraph –
‘(f) excluding trust company business carried on
by a person specified in any of the paragraphs of the Schedule to the Financial
Services (Trust Company Business (Exemptions No. 3)) (Jersey) Order 2001
specified below where that business is carried on in the circumstances described
in that paragraph –
(i) paragraph 1 (private protector company),
(ii) paragraph 2 (general partner),
(iii) paragraph 4 (investment company
subsidiary);’;
(v) after sub-paragraph (g) there shall be
inserted the following sub-paragraphs –
‘ ;
(h) excluding trust company business carried on
in accordance with the exemption set out in the Financial Services (Trust
Company Business (Exemptions No. 5)) (Jersey) Order 2001 by a person who –
(i) is specified in the Schedule to that
Order, and
(ii) is provided with any service that falls
within Article 2(3) and (4) of the Financial Services (Jersey) Law 1998 by
a person registered under that Law to carry on trust company business;
(i) excluding money service business specified
in Article 3 of the Financial Services (Money Service Business)
(Exemptions) (Jersey) Order 2007.’.”.
3 PAGE 9, REGULATION 2 –
After
paragraph (d), insert the following paragraphs –
“(e) in paragraph 7, for the words ‘The business
of providing any of the following services to third parties not otherwise
included in this Schedule – ’ there shall be substituted the words ‘(1)
The business of providing any of the following services to third parties, where
the business is not otherwise included in this Schedule –’;
(f) at the end of paragraph 7 there shall
be added the following sub-paragraphs –
‘(2) A reference in this paragraph to providing
services to third parties shall not include a company’s providing a service to
a connected company.
(3) For the purposes of this paragraph, a
company is connected with another company if –
(a) the companies are in the same group;
(b) one is entitled, either alone or with any
other company in the same group, to exercise or control the exercise of a
majority of the voting rights (other than as nominee shareholder) which are
attributable to the share capital and are exercisable in all circumstances at
any general meeting of the other company or of its holding company; or
(c) the first-mentioned company holds, or a
company in the same group as the first-mentioned company holds, an interest in
the equity share capital of the other company carrying rights to vote in all
circumstances at general meetings for the purpose of securing a contribution to
the activities of the first-mentioned company or the company in the same group
as that company respectively by the exercise of control or influence arising
from that interest.
(4) In this paragraph, ‘group’ and ‘holding
company’ have the same meanings as in the Financial Services (Jersey) Law
1998.’.”.
MINISTER FOR
TREASURY AND RESOURCES
REPORT
These amendments arise as a result of submissions
made by Jersey Finance Limited and the Jersey Funds Association (together “Industry”) subsequent to the lodging of
P.119/2008 and are intended to further clarify the application of
Schedule 2 of the Proceeds of Crime (Jersey) Law 1999 to collective
investment funds.
The amendments –
·
Provide further time for the Jersey Financial Services
Commission (“JFSC”) and Industry to
define a product that has the characteristics of a “COBO-only” fund.
·
In line with previous precedents in Schedule 2,
exclude from its scope certain additional activities that may be considered to
present a lower risk of money laundering. In each case, the person carrying on
the activity must be administered by a person who is prudentially supervised by
the JFSC and subject to anti-money laundering obligations under the Money
Laundering (Jersey) Order 2008.
·
Clarify that where Schedule 2 refers to the
provision of certain services to “third parties”, that term should not be
regarded as covering the provision of a service to a connected (e.g. group)
company.
These
amendments are an essential part of the changes to the Island’s legislative
framework in time for the International Monetary Fund assessment in October
2008.
Financial and
manpower implications
There are no financial or manpower implications for
the States arising from these amendments.