New laws to make Seychelles compliant with the FATF standards

Seychelles has once again been found wanting in terms of being compliant with the standards set by the Financial Actions Task Force. To address the issue which has resulted in a downgrading of the country’s rating to one which is only partially compliant rather than fully or largely compliant. This grading has its consequences and impacts on the country’s economic activity and reputation abroad as a clean offshore centre. To address the matter the Department of Finance has put a series of proposed amendment to laws to the Cabinet of Ministers for consideration ahead of the seventh National Assembly being elected and sworn in. the Cabinet of Ministers has approved the draft laws. These include the Limited Partnership Act; the Foundations Act; the International Business Companies Act; and the new Trusts Bill.

Secretary of State for Finance Patrick Payet explained the amendments and new laws are essential if Seychelles is to be able to push for an earlier supplementary review by the Organisation for Economic Cooperation and Development OECD and the European Union.

“When you discuss with the OECD in regards to these requirements, you have one year to request a supplementary review and as the date of the report which last came out, was 5th April we have until the 5th of April 2021 to request one, but this is something which we do not want.”

Payet added that Seychelles cannot afford to wait until next year.

“Because if you wait until next year, you remain on the blacklist of the OECD and the European Union. We do not want this for Seychelles. This is why we are pushing with the OECD so that if we can amend all our laws by November, so that in December we request the supplementary review and this is tabled by February next year, so that we can get out from the black list!”

He explained that Seychelles was found lacking on different aspects of reporting, including information on:-Beneficial Ownership, Accounting Information and Response to request for information.

According to SS Payet, even if the offshore companies are registered here in Seychelles, it does not necessarily mean that they keep their information here. This has made it difficult for the authorities to access said information and report to the task force promptly. The amendment to the International Business Companies Act will address this and make it easier to access the required information.

“Also, in the past, we were getting only about three or four requests for information during the ranking exercise, but this time around there were more than one hundred requests and we did not have the adequate resources to address them as swiftly as we would have wanted,” Payet concluded.