Peer Review Report - Phase 1 - Anguilla 2011

GLOBAL FORUM ON TRANSPARENCY AND EXCHANGE OF INFORMATION FOR TAX PURPOSES
Peer Review Report Phase 1 Legal and Regulatory Framework

ANGUILLA
Global Forum on Transparency and Exchange of Information for Tax Purposes Peer Reviews: Anguilla 2011
PHASE 1
August 2011 (reflecting the legal and regulatory framework as at May 2011)
This work is published on the responsibility of the Secretary-General of the OECD. The opinions expressed and arguments employed herein do not necessarily reflect the official views of the OECD or of the governments of its member countries or those of the Global Forum on Transparency and Exchange of Information for Tax Purposes.
Please cite this publication as: OECD (2011), Global Forum on Transparency and Exchange of Information for Tax Purposes Peer Reviews: Anguilla 2011: Phase 1: Legal and Regulatory Framework, Global Forum on Transparency and Exchange of Information for Tax Purposes: Peer Reviews, OECD Publishing. http://dx.doi.org/10.1787/9789264117655-en
ISBN 978-92-64-11764-8(print) ISBN 978-92-64-11765-5 (PDF)
Series: Global Forum on Transparency and Exchange of Information for Tax Purposes: Peer Reviews ISSN 2219-4681 (print) ISSN 2219-469X (online)
This document and any map included herein are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. Corrigenda to OECD publications may be found on line at: www.oecd.org/publishing/corrigenda. Revised version, September 2011. Detail of revisions available at: http://www.oecd.org/dataoecd/24/8/48659863.pdf
OECD 2011
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TABLE OF CONTENTS 3
Table of Contents
About the Global Forum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Executive summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Information and methodology used for the peer review of Anguilla . . . . . . . . . . 9 Overview of Anguilla . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Recent developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14 Compliance with the Standards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 A. Availability of Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 A.1. Ownership and identity information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16 A.2. Accounting records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 A.3. Banking information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 B. Access to Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 B.1. Competent Authoritys ability to obtain and provide information . . . . . . . . 46 B.2. Notification requirements and rights and safeguards. . . . . . . . . . . . . . . . . . 50 C. Exchanging Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C.1. Exchange-of-information mechanisms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C.2. Exchange-of-information mechanisms with all relevant partners . . . . . . . . C.3. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C.4. Rights and safeguards of taxpayers and third parties. . . . . . . . . . . . . . . . . . C.5. Timeliness of responses to requests for information . . . . . . . . . . . . . . . . . . 53 54 57 58 60 61
PEER REVIEW REPORT PHASE 1: LEGAL AND REGULATORY FRAMEWORK ANGUILLA OECD 2011
4 TABLE OF CONTENTS Summary of Determinations and Factors Underlying Recommendations. . . . 63 Annex 1: Jurisdictions Response to the Review Report . . . . . . . . . . . . . . . . . . 67 Annex 2: List of all Exchange-of-Information Mechanisms in Force. . . . . . . . 68 Annex 3: List of all Laws, Regulations and Other Relevant Material . . . . . . . 69
ABOUT THE GLOBAL FORUM 5
About the Global Forum

The Global Forum on Transparency and Exchange of Information for Tax Purposes is the multilateral framework within which work in the area of tax transparency and exchange of information is carried out by over 100 jurisdictions, which participate in the Global Forum on an equal footing. The Global Forum is charged with in-depth monitoring and peer review of the implementation of the international standards of transparency and exchange of information for tax purposes. These standards are primarily reflected in the 2002 OECD Model Agreement on Exchange of Information on Tax Matters and its commentary, and in Article 26 of the OECD Model Tax Convention on Income and on Capital and its commentary as updated in 2004. These standards have also been incorporated into the UN Model Tax Convention. The standards provide for international exchange on request of foreseeably relevant information for the administration or enforcement of the domestic tax laws of a requesting party. Fishing expeditions are not authorised but all foreseeably relevant information must be provided, including bank information and information held by fiduciaries, regardless of the existence of a domestic tax interest. All members of the Global Forum, as well as jurisdictions identified by the Global Forum as relevant to its work, are being reviewed. This process is undertaken in two phases. Phase 1 reviews assess the quality of a jurisdictions legal and regulatory framework for the exchange of information, while Phase 2 reviews look at the practical implementation of that framework. Some Global Forum members are undergoing combined Phase 1 and Phase 2 reviews. The Global Forum has also put in place a process for supplementary reports to follow-up on recommendations, as well as for the ongoing monitoring of jurisdictions following the conclusion of a review. The ultimate goal is to help jurisdictions to effectively implement the international standards of transparency and exchange of information for tax purposes. All review reports are published once adopted by the Global Forum. For more information on the work of the Global Forum on Transparency and Exchange of Information for Tax Purposes, and for copies of the published review reports, please refer to www.oecd.org/tax/transparency.
EXECUTIVE SUMMARY 7
Executive summary
1. This report summarises the legal and regulatory framework for transparency and exchange of information in Anguilla. The international standard which is set out in the Global Forums Terms of Reference to Monitor and Review Progress Towards Transparency and Exchange of Information, is concerned with the availability of relevant information within a jurisdiction, the competent authoritys ability to gain access to that information, and in turn, whether that information can be effectively exchanged on a timely basis with its exchange of information partners. 2. Anguilla is a small island of about 15 000 inhabitants located between the Caribbean Sea and the North Atlantic Ocean and is a self-governed overseas territory of the United Kingdom. Anguilla has a robust and modern financial services industry, including online incorporation of its more than 10 000 International Business Companies and has no direct taxation. 3. Anguilla formally committed to the international standards on exchange of information in 2002, and has undertaken to rapidly develop its exchange of information network since 2009. Since then, Anguilla has signed 17 TIEAs, six of which are currently in force. Anguilla continues to develop its treaty network. 4. Also in 2009, Anguilla enacted the International Co-operation (Tax Information Exchange Agreements) Act (ICTIEA Act), which gives the Anguillan authorities the ability to meet the obligations under its treaties. This Act also gives the Anguillan authorities broad powers to access any information from any person pursuant to an international treaty, while providing for sufficient rights and safeguards for taxpayers. 5. In respect of availability of ownership and identity information, Anguilla has clear requirements for ordinary companies, international business companies, partnerships, and foundations to maintain this information, including penalties for failure to comply. In addition, Anguilla has a strong anti-money laundering (AML) regime which applies to most entities because of the requirement to have a licensed service provider as a registered agent and to provide a registered office. The AML laws also apply to banks and requires the maintenance of records of transactions in line with the Terms of
8 EXECUTIVE SUMMARY
Reference. However, in the case of LLCs, it is not certain that ownership and identity information is available. In addition, for trusts, a service provider would only have to know the identity of the beneficiaries in the case of a higher level of risk, which may impede the availability of information on trusts. 6. Anguillas accounting requirements are not in line with the international standard. The requirements to retain records of accounts are not consistently in place for all entities and there is no requirement to retain underlying documentation, nor is there a requirement in place to retain accounting records for 5 years in line with the Terms of Reference. 7. Anguillas response to recommendations in this report as well as the application of the legal framework to the practices of its competent authority will be considered in detail in the Phase 2 Peer Review which is scheduled for the second half of 2013. In the meantime, a follow up report on the steps undertaken by Anguilla to answer the recommendations made in this report should be provided to the PRG within six months after the adoption of this report.
INTRODUCTION 9
Introduction
Information and methodology used for the peer review of Anguilla

8. The assessment of the legal and regulatory framework of Anguilla was based on the international standards for transparency and exchange of information as described in the Global Forums Terms of Reference, and was prepared using the Global Forums Methodology for Peer reviews and Non-Member Reviews. The assessment was based on the laws, regulations, and exchangeof-information mechanisms in force or effect as of May 2011, other materials supplied by Anguilla, and information supplied by partner jurisdictions. 9. The Terms of Reference break down the standards of transparency and exchange of information into 10 essential elements and 31 enumerated aspects under three broad categories: (A) availability of information; (B) access to information; and (C) exchanging information. This review assesses Anguillas legal and regulatory framework against these elements and each of the enumerated aspects. In respect of each essential element, a determination is made that either (i) the element is in place, (ii) the element is in place but certain aspects of the legal implementation of the element need improvement, or (iii) the element is not in place. These determinations are accompanied by recommendations on how certain aspects of the system could be strengthened (see pages 63-65). 10. The assessment was conducted by a team which consisted of two assessors and a representative of the Global Forum Secretariat: Mr. Michael Nugent of Australia, Mr. Luis Antonio Gonzalez Flores of Mexico and Ms. Amy ODonnell of the Global Forum Secretariat. The assessment team examined the legal and regulatory framework for transparency and exchange of information and relevant exchange-of-information mechanisms in Anguilla.
10 INTRODUCTION
Overview of Anguilla General information on the economy and legal system

11. Anguilla is an island of 91 square kilometres located east of Puerto Rico between the Caribbean Sea and the Atlantic Ocean with a population of approximately 15 000 inhabitants. The official language in Anguilla is English. 12. Anguilla is a self-governed overseas territory of the United Kingdom. Great Britain colonized Anguilla in 1650, and administered it until the early 19th century when it was incorporated into a single British dependency along with St. Kitts and Nevis. After seceding from St. Kitts and Nevis, Anguilla became a separate British dependency in 1980. 13. Anguillas chief of state is the Queen of England, who is represented by a Governor. The Governor chairs an Executive Council, which includes all four Ministers of Government led by the Chief Minister, who is the Head of Government and is usually the leader of the majority party or majority coalition. 14. The Constitution gives the British-appointed Governor certain fundamental reserve powers. The Governor retains responsibility for internal security, civil service, defence, external affairs and international financial services. All legislation must be assented to by the Governor as H.M. the Queens representative. 15. Anguillas ministerial form of government provides for a legislature called the House of Assembly. The House of Assembly has 11 seats, 7 of which are elected by direct popular vote, 2 ex officio members and 2 appointed members, all serving 5 year terms. 16. Anguilla is an English common law jurisdiction. Its judicial system is administered by the Eastern Caribbean Supreme Court and has three tiers: Magistrates Courts, High Court and the Court of Appeals. The appeal process culminates with the Privy Council. 17. Anguilla is a small but emerging economy with a GDP of USD 175.4 million (in 2009), mainly dependent on tourism. Tourism contribution to GDP averaged about 30.6 per cent of GDP while construction accounted for 15.5 per cent of GDP. Taken together, tourism and construction accounted for roughly 46.2 per cent of GDP over 2002-2007. The overwhelming majority of tourists, 60%, arrive from the United States. Tourism is followed by construction and financial services (banking and insurance) as the second and third largest sectors. Financial services accounted for 21% of the total GDP in 2009. Given the lack of natural resources, manufacturing in Anguilla is virtually non existent and exports are minimal. All commodities are imported, 59% of which come from the United States.
INTRODUCTION 11
18. While its official currency is the East Caribbean dollar (XCD) at a fixed rate of 2.7 XCD per US dollar (USD), business is also conducted in US dollars.
Overview of Anguillas commercial laws

19. There are no taxes on income, capital gains, estates, profits or other forms of direct taxation in Anguilla on either individuals or corporations, whether resident in Anguilla or not and there is no value added tax in Anguilla. The state raises revenues through a system of indirect taxes and fees levied on hotel accommodation, developed property, business licenses, stamp duties on the transfer of properties and customs duties. Anguilla recently enacted legislation including an accommodation tax, airline ticket tax, communication tax, environmental levy on electricity and a tourism levy. 20. Several types of legal persons and legal arrangements can be established under the laws of Anguilla, including domestic and foreign companies: Ordinary Companies (OCs), International Business Companies (IBCs); limited liability companies (LLCs); trusts; mutual funds; protected cell companies; general and limited partnerships and foundations. Unless licensed to do so, companies cannot carry on banking, trust, insurance or company management businesses. 21. Anguilla allows for modern forms of company formation, including electronic filing and ACORN, Anguillas Commercial On-Line Registration Network System for IBCs. There are 10 508 IBCs currently registered in Anguilla. In addition, Anguilla has 1 945 OCs and 501 LLCs. 22. Protected Cell Companies were established in Anguilla in 2004 pursuant to the Protected Cell Companies Act (PCC Act). The Act provides for a single company with individual parts, known as cells. Each cell is only liable for its own debts and not the debts of any other cell in the company. The establishment of a protected cell account does not create a legal person distinct from the protected cell company. A protected cell company is thus one legal entity. 23. Trusts can be created in Anguilla under the Trusts Act as well as under the common law. Partnerships are governed by the Partnership Act and LPs by the Limited Partnership Act, as well as by the common law. There are currently 35 partnerships registered in Anguilla. Anguillan law also provides for foundations, which are governed by the Foundations Act and serve as an estate planning vehicle, which is a civil law concept and an alternative to the common law trust. There are 22 foundations registered in Anguilla.
12 INTRODUCTION
Overview of the financial sector and relevant professions

24. Anguilla has a robust financial services sector. There are four main categories of financial institutions in Anguilla: offshore and domestic banking; offshore and domestic insurance companies; mutual funds; and company managers. The banking sector consists of 4 domestic commercial banks and 3 offshore banks; and the insurance sector being 21 domestic, 240 offshore and 12 foreign insurance companies with 45 insurance intermediaries. The mutual fund sector consists of 41 mutual fund companies and 22 intermediaries. In addition there are 53 company managers.1 The securities and investments business is very small and Anguilla has no stock exchange. 25. The financial services sector in Anguilla is the responsibility of the Governor, although the day to day regulation is delegated to the Anguilla Financial Services Commission. The Anguilla Financial Services Commission (FSC), was established in 2004 by the Financial Services Commission Act (FSC Act), and is an independent regulatory body that focuses on licensing, supervision of licensees, monitoring of financial services in general, reviewing existing financial services legislation and making recommendations for new legislation as well as maintaining contact with appropriate foreign and international regulatory authorities. The FSC regulates the financial services sector, except for domestic banks, which are regulated by the Eastern Caribbean Central Bank and securities brokers, who are regulated by the Eastern Caribbean Securities Regulatory Commission. The FSC is also the supervisory authority for Anguillas AML/CFT regime, which encompasses all financial service providers, designated non-financial business services and professions (DNFBPs) and non-profit organisations. 26. The FSC has a Director who also sits on the Board, which consists of four or five more individuals appointed by the Governor. One member must be an individual from outside Anguilla with knowledge of the financial services business and no more than one may be a public officer. The FSC has access to and the right to inspect all documents filed with the Registrar of Companies under the Companies Act and all records relating to the administration of the registry by the Registrar. 27. The offshore financial sector is primarily focused on the incorporation and management of companies. Anguilla has many registered agents or company managers (known as company service providers or CSPs) which are recognised as separate entities and engaged in the conduct of company management business and governed by the Company Management Act. The company management business involves the incorporation of companies, acting as registered agents, providing registered offices, preparing and filing statutory documents on behalf of the company or acting as a director, manager, officer or nominee shareholder of local and foreign companies.
1. Source: Anguilla Financial Services Commission, as at 30 November 2010.
INTRODUCTION 13
Other relevant factors for exchange of information

28. Anguilla, as a British Overseas Territory, cannot sign or ratify any transnational convention on its own behalf. Anguilla must instead, through the Governor, request the extension of treaties from the UK. Anguilla is however entrusted to sign tax information exchange agreements, double taxation agreements and ancillary agreements by the UK Government with countries which are members of the G20, OECD and EU, as well as all jurisdictions which are on the OECDs white list of jurisdictions which have substantially implemented the international standard. Entrustments to cover jurisdictions other than those mentioned above can be granted by the UK Government on an ad-hoc basis. 29. Anguilla has a strict AML/CFT regime with requirements for customer due diligence, ongoing monitoring and recordkeeping. The regime was recently scrutinised by the Caribbean Financial Action Task Force (CFATF) and, although some deficiencies were found, the report noted that Anguilla has a strong AML/CFT framework bolstered by the recent enactment of the Proceeds of Crime Act (POCA), the AML/TF Regulations and the AML/TF Code and a high level of public awareness of the issues relating to combating ML and FT. 30. Anguilla entered into a formal written commitment to the OECDs principles of transparency and exchange of information in March 2002. In 2009, Anguilla enacted the International Co-operation (Tax Information Exchange Agreements) Act of 2009 (ICTIEAA), which allows for Anguilla to enter into TIEAs with other jurisdictions. As at May 2011, Anguilla has signed 17 TIEAs in accordance with the ICTIEA Act, six of which are currently in force.2 All but two of its TIEAs are with OECD members.3 31. Additionally, Anguilla automatically provides tax information to each of the 27 European Union Member States in compliance with the Directive 2003/48/EEC of the Council of the European Union on taxation of savings income (the EU Savings Directive). Bilateral agreements between Anguilla and European Member States provide the same measures as the EU Savings Directive and are implemented in Anguilla by the Mutual Legal Assistance (Tax Matters) Act (MLATMA). The Comptroller of Inland Revenue has statutory responsibility for the automatic provision of tax information pursuant to this directive.
2. 3.
Australia, Finland, Germany, Denmark, Norway and the UK Faroe Islands and Greenland
14 INTRODUCTION
Recent developments
32. Anguilla continues to work to expand its treaty network. Further, a TIEA with the Republic of Korea has been agreed, however not yet signed, pending the Republic of Koreas internal procedures. The Government of Anguilla is in the process of negotiating TIEAs with the Governments of Poland and Spain.
COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION 15
Compliance with the Standards
A. Availability of Information
Overview
33. Effective exchange of information requires the availability of reliable information. In particular, it requires information on the identity of owners and other stakeholders as well as information on the transactions carried out by entities and other organisational structures. Such information may be kept for tax, regulatory, commercial or other reasons. If the information is not kept or it is not maintained for a reasonable period of time, a jurisdictions competent authority may not be able to obtain and provide it when requested. This section of the report assesses the adequacy of Anguillas legal and regulatory framework on availability of information. 34. In respect of ownership and identity information, Anguillas laws provide for the effective retention and maintenance of identity and ownership information for companies, partnerships and foundations, in line with the terms of reference and penalties are generally available to enforce these obligations. There is an exception in the case of trusts and LLCs. For trusts, the duty to retain ownership and identity information is derived from the AML laws, but information on beneficiaries is only required in cases of a higher level of risk. In the case of LLCs, there is no requirement to either provide ownership and identity at registration nor is there an express requirement for the LLC to maintain the information itself, although AML laws will require an LLCs registered agent to identify 20% beneficial owners. A recommendation has been made on these point and element A.1. is found to be in place, but certain aspects of the legal implementation of the element need improvement.
16 COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION

35. The obligations imposed in respect of accounting information are generally not in line with the Terms of Reference and therefore element A.2. is not in place. Anguillas laws do not provide for adequate records in respect of accounts in all cases, specifically for LLCs, partnerships and foundations. In addition, Anguillan law does not provide for the retention of underlying documentation or retention of documents for a minimum of 5 years for any entity. Therefore, this report recommends that Anguilla amend its laws to comply with the international standard in this regard. 36. Banks are covered institutions for AML purposes and therefore required to keep adequate records of accounts and related financial and transactional information in line with the Terms of Reference. Element A.3. is therefore found to be in place.
A.1. Ownership and identity information

Jurisdictions should ensure that ownership and identity information for all relevant entities and arrangements is available to their competent authorities.
Companies (ToR A.1.1) Types of Companies

37. There are three forms of companies in Anguilla: Ordinary Company (OC): can be used both within Anguilla and as an offshore vehicle. They are governed by the Companies Act. OCs can be either domestic, non-domestic (a company that does not maintain a physical presence, office or staff in Anguilla or that does not engage in any revenue generating activities in Anguilla) or foreign (incorporated or formed under the laws of another country, but with business activities in Anguilla). International Business Company (IBC): governed by the IBC Act. Cannot carry on business with persons resident in Anguilla and cannot be a banking, insurance, company management or general trust business or own or hold an interest in real property in Anguilla. Limited Liability Company (LLC): governed by the LLC Act. Can provide limited liability with pass through of income and losses to partners; can carry on any business, purpose or activity not prohibited by the laws of Anguilla, including with persons in Anguilla; can become a member of a general partnership, limited partnership, company or any other LLC and can carry on banking, insurance, trust or company management business with proper license, but is prohibited from owning or holding an interest in real property situated in Anguilla.
38. All corporate entities are required to register with the Registrar of Companies for formation. Pursuant to section 15 of the Companies Registry Act, all documents filed with the Registrar must be maintained for at least 20 years after dissolution of the company. 39. All bodies corporate (OCs, IBCs and LLCs) are required by law to have a registered office and a registered agent in Anguilla at all times. The registered office and registered agent of an IBC, LLC and non-domestic company must be provided by a person who holds a relevant license (see Service Provider section below). Domestic or foreign OCs may have a nonlicensed registered agent (i.e. a registered agent not acting by way of business), although it is long-standing policy of the Registrar of Companies not to accept registration of such companies without a licensed registered agent.
Company ownership and identity information required to be provided to government authorities Ordinary Companies
40. Registration by an OC must be accompanied by the articles of incorporation and must set out the address and mailing address of the registered office and registered agent, the classes and any maximum number of shares the company is authorised to issue and the name, nationality and mailing address of any director. (Companies Act, Sec. 7). 41. Foreign OCs must also register with the Registrar of Companies. Registration must include a certified copy of its charter, statutes or articles of association, a list of the directors and a notice specifying the name and address of its registered agent in Anguilla. 42. All OCs must file an annual return, which includes the names of all shareholders, their address and nationality (Section 158, Companies Act and Companies Regulations, Schedule 2, Forms 5 and 9).
International Business Company

43. An IBC must file articles of incorporation with the Registrar of Companies, specifying the name of the company, the address within Anguilla of its registered office, the name and address of its first registered agent, and the number and class of its shares (IBC Act, Sec. 7). Companies formed under the IBC Act are not required to file information regarding shareholders or directors, but may elect to do so (Sec. 128). However, IBCs are required to maintain a share register, therefore ownership and identity information is available.

44. Any time an IBC amends its articles or by-laws it must, within 14 days, file such amendment with the Registrar (Sec. 10). An IBC must have a registered agent at all times.
Limited Liability Company

45. An LLC is formed by filing articles of formation with the Registrar of Companies (LLC Act, Sec. 11). The articles must contain the name of the LLC, the address of its first registered office and the name and address of its first registered agent. These articles can be amended by filing articles of amendment with the Registrar but no ownership information is required (Sec. 13). An LLC must have a registered agent at all times. 46. The members of an LLC may also enter into an LLC agreement concerning the affairs of a LLC and the conduct of its business, which does not have to be filed at the Companies Registry. 47. The Registrar must keep a Register of LLCs in which the articles of formation for every LLC and any amendment thereto are registered. This register is available to the public for inspection.
Company ownership and identity information required to be held by companies Ordinary companies
48. All OCs must prepare and maintain records that contain the articles and bylaws of the company, minutes of meetings and resolutions of shareholders and a register of directors (Sec. 152). An OC must also maintain a register of shareholders at its registered office. Directors and shareholders of an OC must have access to these records during normal business hours (Sec. 157). A company may appoint an agent to prepare and maintain these registers. 49. A public company whose shares are listed on a stock exchange may keep its shareholder register outside Anguilla where the stock exchange is located, but must ensure that a copy of its register as of the last day of each quarter is sent to its registered office and must keep at its registered office a copy of each of these registers and the address where the original register is kept (Sec. 152(6)). 50. A company and its agents must take reasonable precautions to prevent loss, destruction or falsification of entries and to facilitate detection and correction of inaccuracies in the records required to be prepared and maintained in respect of the company (Sec. 156).
IBCs
51. An IBC must keep minutes of all meetings and copies of all resolutions, as well as the articles and by-laws of the company at the registered office or at such other place as the directors may determine, although the articles and bylaws must be kept at the registered office (Sec. 65). A shareholder of an IBC is entitled to copies of the articles and by-laws upon request (Sec. 66). 52. An IBC must also maintain a share register showing the name and last known address of each person who holds a registered share, the number of each class and series of shares held by each shareholder and the date a person became or ceased to be a shareholder (Sec. 24). For each share issued to bearer, the IBC must record the identifying number of the certificate, the number of each class or series of shares issued to bearer specified therein and the date of issue (See Bearer Shares section below). 53. A copy of such share register must be kept at the registered office of the company or at the office of its registered agent (Sec. 24(3)). An IBC is not required to treat a transferee of a registered share as a shareholder until the transferees name has been entered in the share register (Sec. 26). LLCs 54. There is no express requirement for an LLC to maintain a list of members. However, each member of an LLC has the right to obtain from the LLC true and full information regarding the status of the business and financial condition of the LLC (LLC Act, Sec. 25). In addition, the members may obtain a current list of the name and last known business, residence or mailing address of each member, holder of an economic interest and manager and a copy of the LLC agreement, the articles of formation and all amendments thereto (LLC Act, Sec. 25(1)). Further, Section 25(5) of the LLC Act provides that a request, including a request to obtain membership information may be enforced by a court order. This is not, however, equivalent to having an express obligation to maintain records. Although the AML laws require the registered agent of an LLC to conduct customer due diligence (CDD) on its customer, which is the LLC, as discussed in the AML section below, Anguillas laws are unclear on whether this requires that the registered agent know all the owners of the LLC or simply those with 20% ownership or more. Therefore, Anguilla should ensure its laws expressly require that LLCs maintain ownership and identity information on its members in line with the Terms of Reference.
Licensed Entities
55. In Anguilla, there are a number of specifically regulated sectors that require that the business is carried on by a license holder. Such entities are supervised by the Financial Services Commission (FSC). These include the following: banks subject to the Banking Act, with the exception of domestic commercial banks (which are regulated by the ECCB) offshore banks and trust companies governed by the Trust Companies and Offshore Banking Act (TCOBA) insurance companies, agents and brokers governed by the Insurance Act managers or administrators of a mutual fund under the Mutual Funds Act
Banks and Trust Companies

56. Banks must be licensed in Anguilla under the Banking Act (Sec. 2). A bank can obtain a license by application to the Minister and must submit authenticated copies of the organisational instrument, the address of its head office and the name and address of every member of its board, among other information (Schedule 1, Sec. 4(1)). 57. Offshore banks and trust companies are licensed in Anguilla under the TCOBA. Offshore banking business must be carried in or from within Anguilla, in a currency other than Eastern Caribbean dollars, only with nonresidents of Anguilla and is limited to the following: branches or subsidiaries of banks with a well established, proven track record which are subject to effective consolidated supervision; banks that are not subsidiaries but are closely associated with an overseas bank, which, by agreement, are included in the consolidated supervision exercised by the overseas banks home supervisory authority; wholly-owned subsidiaries of acceptable non-bank corporations whose shares are quoted on a recognised stock exchange, where the objective of the subsidiary is to undertake in-house treasury operations only, and where such operations are fully consolidated within the published financial statements of the parent company. 58. An offshore bank must apply to the Governor for a license and must include the name of the applicant, the address in Anguilla of the principal office and its registered office and the names of all shareholders and details of percentage of shareholding (TCOB Regulations, Schedule 1, Section 2(1)).
In addition, an addendum is required with the details of each shareholder, beneficial shareholder or director of a company, including full name, date and place of birth, nationality, home address and additional extensive personal and financial information. 59. An offshore bank must at all times have a principal office in Anguilla and two authorised agents, who must be individuals resident in Anguilla (TCOBA, Sec. 20). An offshore bank cannot change the address of its principal office or agent without prior written approval by the Inspector of Trust Companies and Offshore Banks. 60. Trust companies must also be licensed in order to operate in Anguilla, unless the trust company is a domestic bank that currently holds an offshore banking license or an attorney-at-law so far as he is engaged in a trust business solely in the practice of law (TCOBA, Sec. 10). 61. A trust company license may be either general or restricted. The applications for both a general and restricted trust company license require the same information as for an offshore bank above and would therefore include ownership and identity information. 62. Only an OC may have a general trust company licence; and an IBC may only obtain a restricted trust company licence. For a restricted license, the applicant must list the name of the persons on whose behalf it will be a trustee, and cannot undertake a trust business on behalf of persons other than those listed or named in any amendment to the list.
Insurance and Protected Cell Companies

63. Insurance companies can be either domestic or foreign. Anyone carrying on an insurance business in or from within Anguilla must have a license. An application for a license must be filed with the FSC. 64. Any company incorporated, continued or registered under the Companies Act and which is engaged in the insurance business may apply to the Registrar of Companies to be registered as a protected cell company (PCC). A PCC is a single company with individual parts, known as cells, each cell being liable only for its own debts and not the debts of any other cell in the company. A PCC may be formed under the Protected Cell Companies Act (PCC Act). A non-insurance company can also apply, but must obtain approval from the FSC. The Registrar of Companies maintains a register of PCCs. 65. A PCC must maintain a register of account owners which sets out their respective interest in any protected cell account together with the particulars required in respect of the members of the PCC as set out in the Companies Act (PCC Act, Sec. 12(8)). All such records must be made available to the FSC

upon request. Records maintained may be inspected by any account owner of that protected cell account. 66. When a PCC is engaged in the insurance business and the Insurance Act applies, these records are to be kept at its principal office. A PCC must appoint and maintain a protected cell account representative in Anguilla who must be approved by the FSC.
Mutual Funds
67. Mutual funds were established in Anguilla in 2004 pursuant to the Mutual Funds Act. A mutual fund can be a company incorporated, a partnership formed, a unit trust organized or other similar body formed under the laws of Anguilla or any other jurisdiction. 68. There are three types of mutual funds in Anguilla: public fund, which offers shares to the general public and is not a private or professional fund private fund, made up of 99 or fewer investors where the invitation to purchase shares is made on a private basis professional fund, shares of which are available only to professional investors with an initial investment of at least USD 100 000 and whose ordinary business involves dealing in investments or who declares a net worth of USD 1 million (or its equivalent in another currency) and consents to being treated as a professional investor. 69. In addition to the requirements pertaining to the type of entity, the documents required to form a mutual fund depend on the type of business association. 70. Public funds must be registered in order to carry on business. Such application must be made to the FSC and be accompanied by a statement declaring the nature and scope of the business, including the name of any other country or jurisdiction where the applicant is carrying on or intends to carry on business; notices of the address of the applicants place of business and address for service in Anguilla; name and address of the person resident in Anguilla who is authorised to present the applicant and to accept service; address of any place of business the applicant may have outside of Anguilla; and such other documents or information as the FSC may reasonably require. 71. Both private and professional funds must similarly register, and registration includes proof satisfactory to the FSC that it is a private or professional fund within the meaning of the Act; notices of the address of the applicants place of business and its address for service in Anguilla; the name and address of a person resident in Anguilla who is authorised to represent
the applicant and to accept service on its behalf; and the address of any place of business that the applicant may have outside of Anguilla. 72. A professional or private fund constituted under the laws of a country other than Anguilla seeking to register in Anguilla must send a letter to the FSC setting forth the nature and scope of the business to be carried on in Anguilla; proof satisfactory to the FSC that it is a private or professional fund within the meaning of the Act and that it is lawfully constituted under the laws of another country or jurisdiction; notices of the address of the applicants place of business and its address for service in Anguilla and the address of any place of business the applicant may have outside Anguilla.
Service Providers
73. An OC, IBC, LLC or an attorney-at-law4 can engage in the company management business, pursuant to the Company Management Act (CMA) and must hold a license. Company management business is defined as the business of: incorporating or forming companies; providing the registered office for companies; acting as a registered agent for companies; preparing and filing statutory documents on behalf of companies; acting as a director, manager or officer of companies or foreign companies; or acting as a nominee shareholder of companies or foreign companies. 74. It also includes offering or agreeing to carry out any of the above named activities with the intent to carry on a business (CMA, Section 1(1)). 75. A license application includes the name of the applicant, the address in Anguilla of his/her principal office, in the case of a company, the address of the registered office and the names of all shareholders and their percentage interest in the company, the names of all of the directors of the company, among other things (CM Regulations, Schedule 1, Section 2). 76. The Governor may revoke and suspend a license at any time if it appears to him/her that the licensee is not fit, is insolvent, is carrying on the business in a manner detrimental to the public interest or to the company or that he/she has contravened any provision of the CMA or the AML Regulations (Sec. 9).
4. Attorney-at-law is defined in the Act as an attorney admitted to practise before the Eastern Caribbean Supreme Court in Anguilla.

77. The CMA also establishes the office of Inspector of Company Management as a public office responsible for ensuring the proper administration of the Act (Sec. 17).
Anti-Money Laundering laws

78. The regulatory framework for Anguillas financial sector is reinforced by the AML/CFT regime, which is contained in the Proceeds of Crime Act of 2009 (POCA); the Anti-Money Laundering and Terrorist Financing Regulations of 2009 (AML/CFT Regulations); and the Anti-Money Laundering and Terrorist Financing Code of 2009 (AML/CFT Code), and its accompanying Guidance Notes. 79. The AML/CFT Code has the status of law in Anguilla. The Guidance Notes are incorporated within the Code but do not have the status of law. However, the POCA requires that a court consider whether a person has followed the Guidance in determining whether he/she has committed an offense under the Code. 80. The FSC is the supervisory authority for purposes of Anguillas AML/ CFT regime. Anguillas AML/CFT regime imposes strict requirements on service providers for customer due diligence, ongoing monitoring and recordkeeping. These requirements apply to all persons, natural and legal, who fall within the definition of service provider. Service providers include the following, among others: licensees under the Banking Act offshore banks and trust companies licensed under the TCOBA company management companies licensed under the CMA insurers, brokers and agents licensed under the Insurance Act attorneys-at-law insofar as they are carrying on a trust business persons carrying on an investment business as defined in the AML/ CFT Regulations persons carrying on the business of forming LPs, foundations or PCCs persons carrying on the business of providing registered offices for LPs, lending, wiring funds, financial leasing, etc. persons acting as a manager, administrator or promoter under the Mutual Funds Act persons carrying on any business, or undertaking any activity for which a licence is required under the Securities Act, and
persons engaged in the activity of dealing in goods of any description by way of business which involves accepting a total cash payment of XCD 50 000 or more (approximately USD 18 500). 81. Sections 10 and 11 of the AML/CFT Regulations and the AML/CFT Code require service providers to undertake customer due diligence (CDD) measures prior to establishing a business relationship or executing an occasional transaction.5 In the case of a legal entity, the AML/CFT Code requires identification measures of individuals who are the ultimate shareholders owning twenty percent of the shares or more. However, section 4(1) of the AML/CFT Regulations defines CDD to include identifying the identity of each beneficial owner of the customer and third party, where either the customer or third party or both are not individuals (emphasis added). Beneficial ownership is determined without regard to whether shares are held directly or indirectly, for example through a series of separate entities or arrangements. Thus, the identification requirements under the Regulations are broader than under the Code. In particular, the term beneficial owner is defined under the Regulations as including any individual that is an ultimate beneficial owner and any person that exercise ultimate control over the management of the person. It is unclear whether the twenty percent test applies equally to the test under the Regulations and how this is interpreted and applied in practice. 82. Section 10 of the AML/CFT Regulations also requires service providers to conduct ongoing monitoring of its customers and to obtain identification information where there is a change in the identification information of a customer, where there is a change in beneficial ownership of a customer or when there is a change in the third parties or the beneficial ownership of third parties. Section 5(4) of the AML/CFT Regulations provide that ongoing monitoring of a business relationship means: (a) scrutinising transactions undertaken throughout the course of the relationship, including where necessary the source of funds, to ensure that the transactions are consistent with the service providers knowledge of the customer and his business and risk profile; and (b) keeping the documents, data or information obtained for the purpose of applying customer due diligence measures up-to-date and relevant by undertaking reviews of existing records. 83. The service provider must keep a copy of the evidence of identity obtained pursuant to CDD measures, the supporting documents, data or information obtained, a record of details of transactions, all account files and all business correspondence relating to the business relationship or transaction (AML/CFT Regulations, Sec. 17(2)).
5. Occasional transaction is defined in the AML/CFT Regulations as when the transaction is carried out otherwise than as part of a business relationship and is carried out as a single transaction over a certain sum (Sec. 3).

84. This information is accessible to the FSC immediately upon request, or, if it is held at a location outside Anguilla, pursuant to the Guidelines on Introduced Business issued by the FSC it must be made available within 72 hours. While there is no specific penalty for failure to do so, failure to comply with the due diligence requirements of the AML/CFT Act, Regulations and Code will be considered in assessing whether licensees should continue to maintain a relationship with delinquent intermediaries/introducers. Repeated noncompliance on the part of intermediaries/introducers will have an impact on a licensees fit and proper status and its eligibility to continue to hold a company management licence.
Nominees
85. Any person engaged in the business of acting as a nominee shareholder of a company (whether domestic or foreign) is carrying out company management business (see Service Provider section above) and must be licensed under section 4(1) CMA. This results in the nominee being subject to Anguillas AML regime. Specifically, a nominee is required to know his/her customer, which in this case would require knowing who is the legal owner of the share.
Bearer shares (ToR A.1.2)

86. Only IBCs can issue bearer shares in Anguilla, pursuant to the IBC Act. 87. The IBC Regulations on Custody of Bearer Shares (CBS Regulations) require bearer shares to be in the custody of a custodian (Sec. 3(1)). A bearer share that is held by any person other than a custodian is disabled (unless it is held by the IBC itself and the IBC does not hold it on behalf of another person). 88. Section 4(1) of the CBS Regulations places an explicit duty on the custodian to identify the beneficial owners of the shares being held. Within 14 days from receipt of a bearer share, a custodian must send written notice to the registered agent of the company stating that he is the custodian of the share and has entered into a custody agreement with the beneficial owner of the share, whom he has identified (Sec. 4(1)). The custodian has a duty to ensure that the bearer share remains at all times within his custody and control. Transfer of a bearer share is not effective until the registered agent of the company is given notice by the custodian (Sec. 7(3)). 89. A custodian must be licensed under the TCOBA or the CMA, or be a foreign regulated person within the meaning of the AML/CFT Regulations and the AML/CFT Code. A foreign regulated person is defined as a person that is incorporated in, or if it is not a company, has its principal place of
business in, a country outside Anguilla; that carries on business outside Anguilla that, if carried on in Anguilla would be a regulated business or would result in the person falling within the definition of independent legal professional; that, in respect of the business is subject to legal requirements in its home country for AML/CFT purposes that are consistent with FATF recommendations and is subject to effective supervision for compliance with those legal requirements by a foreign regulatory authority. A foreign regulated person would not be subject to Anguillas AML regime. 90. A custodian does not have to be resident in Anguilla. Currently 4 of the 27 licensed custodians are not resident in Anguilla, and they hold bearer shares for 61 companies. Where the custodian is not resident in Anguilla, it is the responsibility of the registered agent of the IBC to verify that the custodian maintains direct control facilities for the safekeeping of bearer shares which are satisfactory to the FSC (Sec. 5). The Custody of Bearer Shares Regulations do not expressly require that the custodian provide the registered agent with identity and ownership information on the bearer share; it only requires that the custodian inform the registered agent of its custodial relationship and that it has identified the beneficial owner of the bearer share. A registered agent has to be advised of any change in ownership of bearer shares in order for the transfer to be effective. In addition, the registered agent has an obligation under the AML laws to identify the owners of the company for which he/she acts. However, as discussed in the AML section above, it is not clear that this would require the registered agent to know all the ultimate beneficial owners (as specified in the AML Regulations), or only those shareholders that own more than 20% of a legal entity. Consequently, there may be some instances where the registered agent does not have a duty to know the owner of a bearer share and therefore information on the owner of bearer shares may not be available in Anguilla in all cases.
Partnerships (ToR A.1.3)

91. Partnerships in Anguilla can be either general or limited; general partnerships being governed by the Partnership Act and limited partnerships (LPs) being governed by the Limited Partnership Act (LP Act). Both acts make clear that the rules of equity and common law apply in so far as they are not inconsistent with the express provisions of the respective acts. Partnerships are not separate legal entities in Anguilla, therefore property is held by the partners exclusively for the purpose of the partnership. There are currently 35 general and limited partnerships operating in Anguilla. 92. There is no statutory provision for the formation of a general partnership, but the Partnership Act contains rules for determining whether a partnership exists. The Partnership Act defines partnership as the relation that subsists between persons carrying on a business in common with a view to profit.

93. An LP is formed by two or more persons entering into a Partnership Agreement, which regulates the conduct of business of the partnership and the rights and obligations of partners. An LP may undertake any lawful purpose within or outside Anguilla. 94. A person may be both a general and limited partner and both a body corporate and a partnership may be a partner (Sec. 3).
Ownership and identity information provided to the government

95. A general partnership carrying on business in Anguilla must obtain an annual business license under the Trades, Business, Occupations and Professions Licensing Act (TBOPL Act). The application for a licence under the TBOPL Act requires an applicant to provide the full name, address, date and place of birth, nationality and social security number, among other things in the case of a natural person. For a corporate applicant, the application would include the percentage ownership by Anguillan, identity of officers or directors, list of shareholders, including their nationality, identity of manager, and, if a foreign based company, the name and address of the company. 96. Every LP must register by filing a statement with the Registrar of Companies, which includes the name and general business address of the partnership, the address of the registered office and the name and address of the registered agent of the partnership as well as the full name and address of each general partner. There is no requirement to list the names of limited partners upon registration (Sec. 11). If any of the general partners is a body corporate, registration must also include its certificate of incorporation or its certificate of registration under the Companies Act.6 A partner can change any information by filing a statement with the Registrar within 30 days. If an LP fails to register under this section, it is deemed to be a general partnership. 97. An LP must at all times have a registered office in Anguilla provided by a person who holds a relevant license (Sec. 6). It must also have a registered agent in Anguilla who must also hold a relevant licence. Both the registered office provider and the registered agent would be service providers for AML purposes, and would therefore be required to retain ownership and identification information on the LP (see Anti-Money Laundering Laws section above). 98. An LP must file with the Registrar an annual return signed by or on behalf of the general partners certifying that the partnership has complied with the requirement to notify the Registrar of any changes (Sec. 13).
6. Mutual funds may also be structured as general or limited partnerships, in which case they are required to be licensed or registered as such under the Mutual Funds Act.
Ownership and identity information held by the partnership

99. A general partnership is required to keep the partnership books at the place of business of the partnership or the principal place of business if more than one exists (Partnership Act, Sec. 25(i)). However, the act does not specify whether such books would include ownership and identity information. 100. The general partners of an LP must maintain at its registered office the partnership agreement and any amendment thereto; a register in writing of all persons who are limited partners, showing their full names and addresses and specifying in relation to each limited partner the amount that he has agreed to contribute to the capital of the LP; the amount and date of each contribution made to the capital of the LP; the amount and dates of any payments representing a return of his contributions or part thereof; and copies of all documents filed with the Registrar of Companies. These documents must be open to inspection by any general or limited partner (Sec. 14). The register of all limited partners must be updated within 21 business days of any change. 101. In addition to a partnerships duties under the relevant statutes, a partnership also has a duty under the common law to keep accurate accounts of all money transactions relating to its business. 7
Trusts (ToR A.1.4)

102. The Trusts Act governs the creation and administration of trusts and has its roots in English trust law. The Trusts Act allows for the creation of commercial or charitable purpose trusts, unit trusts, spendthrift trusts, and variant trusts. A trust is not a separate legal entity and trust property is therefore held or owned by a trustee and not the trust itself. 103. In Anguilla, a trust may be created by oral declaration, by an instrument in writing, by conduct, by operation of law or in any other manner once the intention of the settlor is clearly manifested, although a unit trust can only be created by a written instrument (Sec. 4). A trust may also be created by a service provider licensed under the TCOBA, but does not have to be. 104. Any person who has the capacity under the law of Anguilla to own and transfer property may be the settlor of a trust. The settlor may also be a trustee, beneficiary or a protector of the trust (Sec. 8). 105. A trust must have at least one trustee, who may be resident in or out of Anguilla. The trustee owes a fiduciary duty to the beneficiaries, and also has
7. Scamell, E.H. and Banks, R.C., Lindley on Partnership (15th edn. 1984) at 579, citing Lord Eldon in Rowe v Wood (1795) 2 Jac. & W. 558-559; and in Goodman v Whitcomb (1820) 1 Jac. & W. 589, 593 and 3 V. & B. 36; and per Lord Davey in Trego v Hunt [1896] A.C. 7, 26.

a duty to provide full and accurate information as to the state and amount of the trust property and the conduct of the trust administration to the court, trust settlor or protector, and any beneficiary of the trust who is of full age and capacity (Sec. 27). A trustee, therefore, would have a duty to know the identity of the settlor or any beneficiaries, however this is not expressly stated in the law. 106. Trust services provided by trust companies are governed by the TCOBA (see Licensed Entities section above). Anyone providing trust services as part of a trade or business would either have to be a trust company licensed under the TCOBA, a domestic bank or an attorney at law and would in all three cases be subject to the AML/CFT regime. 107. Sections 10 and 11 of the TCOBA expressly provide that licensed trust business may only be carried on in or from within Anguilla by a domestic company, a foreign company or, in limited circumstances, by an IBC that holds a valid license issued under Part 3 of the TCOBA. In all cases, they would have to be licensees under either the TCOBA, Banking Act or CMA and would therefore be subject to Anguillas AML/CFT laws including on ownership and identity information (see Licensed Entities section above). 108. One source of ownership and identity information in Anguilla is the Register of Trusts, which the Trusts Act requires that the Registrar of Companies keep. An application for registration of a trust must be accompanied by a certified copy of the instrument creating the trust as well as the name of the trust, if any, the name of the settlor and the name of the beneficiary or the purpose for which the trust is established (Sec. 66). However, registration of a trust is optional in Anguilla and therefore ownership and identity information on trusts should be available by other means (see below). 109. Anguillas AML/CFT regime in relation to trusts is the source of the duty for a trustee carrying on a trade or business to have identity and ownership information on the settlor, protector and enforcer of the trust. Sections 18 and 19 of the AML/CFT Code relate specifically to trusts. Section 18 requires that the following identification information be obtained: the name of the trust and its date of establishment any official identifying number identification information for each trustee of the trust, including mailing address identification information of each settlor, protector or enforcer of the trust. 110. Settlor includes a person who established the trust and any person who has, at any time subsequently settled assets into the trust (AML/CFT Code, Sec. 18(2)).
111. However, the AML/CFT code only requires a service provider to obtain identification information on the beneficiaries in situations where a service provider determines that any business relationship or occasional transaction concerning the trust that it is required to identify presents a higher level of risk. In such cases, the service provider is required to obtain identification information on each beneficiary with a vested right and each beneficiary and each person who is an object of a power, who the service provider determines presents a higher level of risk (Sec. 4). The Anguillan authorities note that the term higher level of risk means merely risk that is higher than minimal and does not necessarily mean that the level of risk is high. This is a substantial deficiency and Anguilla should update its legislation require a trustee to obtain identification information on beneficiaries in all cases. 112. In addition, the Trusts Act requires that trustees provide, upon request, full and accurate information as to the state and amount of the trust property and the conduct of the trust administration. Anguilla advises that this requirement would require all trustees to maintain such information as may be necessary to comply with such a request, including information relating to any other trustees, settlors and beneficiaries (Sec. 27). However, it is not clear from Anguillas legislation or regulatory guidance exactly what information this would require and whether it includes all identity and ownership information on the trust, although a trustee does have a fiduciary duty as discussed at paragraph 105 above which includes a duty for a trustee to know the identity of the settlor and beneficiaries.
Foreign trusts
113. A foreign trust, meaning every trust not governed by the laws of Anguilla, is enforceable in Anguilla except to the extent that it purports to do anything contrary to the law of Anguilla or to confer any right or power or impose any obligation that is contrary to the law of Anguilla (Sec. 63). 114. There are no prohibitions on a resident acting as a trustee, administrator, protector or otherwise in a fiduciary capacity in relation to a trust formed under foreign law. The licensing requirement would apply under the TCOBA as well as the POCA and the AML/CFT Regulations and Code. 115. In sum, Anguillan law does not require the registration of trusts (although it is optional). However, Anguillan or foreign law trusts, where significant elements of the trust such as a resident professional trustee, are connected with Anguilla, would be subject to the AML/CFT regime, which requires a trustee to have ownership information on the settlor. However, such ownership information would not include information on beneficiaries, except in cases determined by the service provider to present a higher level of risk. In the limited case of a non-professional trustee, ownership and

information requirements exist pursuant to the common law, but are less clear. It is also conceivable that a trust could be created under the laws of Anguilla which has no other connection with Anguilla. In that event there may be no information about the trust available in Anguilla.
Foundations (ToR A.1.5)

116. Foundations can be established in Anguilla under the Foundation Act. A foundation can be established by one or more natural or legal persons either by declaration of establishment or by will. 117. A foundation may be established for any purpose(s) which are capable of fulfilment and are not unlawful, immoral or contrary to public policy (Sec. 5(1)). The purpose cannot include any prohibited activity in Anguilla or the conduct of any financial services business, without a relevant license (Sec. 5(2)). A foundation that holds such a license falls under the regulations of the FSC and would be a service provider for AML/CFT purposes and therefore subject to customer due diligence requirements (see AML/CFT section above). 118. A foundation must have a registered agent at all times in Anguilla (Sec. 17). Such agent must be a regulated person, meaning he or she must be licensed under either the CMA or the TCOBA. 119. A foundation must also at all times have a foundation council made up of one or more persons, whether corporate entities or individuals. The council has the responsibility to carry out the objectives and purposes of the foundation. 120. Every foundation must have a secretary who is a regulated person residing in Anguilla. The secretary may also be the registered agent of the foundation. If the foundation council includes at least one regulated person who is permanently resident in Anguilla, it does not need to have a secretary. If the council has only one member, that member cannot also be the secretary. The secretary is responsible to the council for the implementation of the decisions and policies of the council in compliance with the Foundation Act and the laws of Anguilla. A foundation may also appoint a person to be guardian of the foundation. 121. Foundations can either be established within or outside Anguilla. For foundations established in Anguilla, a declaration of establishment (declaration) or a testamentary declaration of establishment must be filed with the Registrar of Foundations (who is also the Registrar of Companies). Such declaration is publicly available.8 For an overseas foundation continuing in Anguilla, its articles of continuance must be filed with the Registrar of Foundations.
8. A foundation for non-commercial purposes is deposited rather than registered, the difference being that for a non-commercial purpose foundation, the information
122.
The declaration must set forth the following: name of the foundation, its purpose and the initial property endowment name and address of the founder(s) the full names and addresses of the foundation council members name and address of the registered agent name and address of the secretary and guardian, if any, provisions, if any, for the designation of beneficiaries names and addresses of any designated beneficiaries.
123. The foundation has an ongoing duty to keep the foundation documents up to date. If the declaration of establishment is amended or a change occurs in any of the specified facts that must be provided, the foundation must within 14 days of such change, file or deposit with the Registrar a notice, signed by the registered agent containing the details of the change. 124. A foundation must keep a copy of its declaration and by-laws and any amendment or change thereto. The secretary, or in the absence of a secretary, the registered agent, must keep a register with the identification particulars of the council members, guardian, beneficiaries, auditors, where applicable, and any person having power of attorney by the foundation (Sec. 37). Note that registered agents would also be a service provider for AML/CFT purposes and would therefore be obligated to maintain up to date ownership and identity information regarding their clients and their clients beneficial owners. Such records must be kept at the registered address of the foundation, or at such other place as the council designates and must be open to inspection by the registered agent and the council. If books are kept at a place other than the registered address, whether within or outside Anguilla, the registered agent must be notified of the location and must be furnished with such records on request. 125. Where there is an obligation on any person to have information on the identity of founders, members of the foundation council and any beneficiaries, every record must be kept for a period of not less than 6 years after the end of the period to which it relates (Sec. 6). Every record required to be kept under section 37 of the Foundations Act must be kept for a period of not less than 6 years from the end of the period to which it relates (Sec. 37(6)). Further, pursuant to section 14 of the Companies Registry Act, documents filed with the Registrar are retained for at least 20 years after dissolution. Although the AFA is not explicitly named as a Registry Act for the
in the application would not be made open to the public.

purposes of the Companies Registry Act, Anguilla advises that as a matter of policy it applies the same retention requirements to documents filed under the Foundations Act as it does to documents filed under the Registry Act.
Other relevant entities and arrangements

126. Under Anguillan law credit unions or friendly societies can also be formed, pursuant to the Co-operative Societies Act and the Friendly Societies Act respectively. Both provide small scale customer credit to members and both are registered with and regulated by the FSC. There is only one credit union in Anguilla. Neither credit unions nor friendly societies carry on international business and their activities are restricted to that of their members, therefore they are not necessarily relevant to this review.
Enforcement provisions to ensure availability of information (ToR A.1.6)

127. Offences under the Companies Act are set out in Schedule 1. Failure to maintain ownership records results in a fine of XCD 25 000, imprisonment for six months or both. For a corporation making a false or misleading report or return the penalty is XCD 25 000. For an OC failing to keep sufficient accounting records, or records of minutes or failing to take reasonable care of such records, the penalty is XCD 25 000 for a corporation and the same fine and/or imprisonment for 6 months for an individual. When a company fails to file financial statements with the Registrar the penalty is XCD 5 000 for both a corporation and an individual. For a foreign OC that carries on business in Anguilla without registering, the fine is XCD 10 000 for either a corporation or an individual. A foreign company that fails to amend its documents or that fails to file an annual return its XCD 5 000 for an individual or the corporation. 128. Offences under the IBC Act are set out under Schedule 1 of the Act. An IBC that carries on a restricted business is subject to a fine of XCD 25 000 for a corporation and a similar fine, imprisonment for 6 months or both for an individual. For failure to file notice of amendment with the registrar, failure to state whether share certificates have been issued, failure to properly maintain share register or keep it at its registered office or office of its registered agent, or for failure to enter details of transfer of share into share register, the penalty is XCD 5 000 for a corporation or an individual. For a person providing a registered office or acting as a registered agent without a licence, the penalty is XCD 25 000 for a corporation and the same fine and/or 6 months imprisonment for an individual. An IBC that fails to keep accounting records is subject to a fine of XCD 10 000 for an individual or corporation. Finally, a person making a false or misleading report or return is subject to a fine of XCD 25 000 for a corporation and the same fine and/or 1 year imprisonment for an individual.
129. The AML/CFT laws impose strict penalties for failure to comply with the requirements. Failure to carry out customer due diligence or ongoing monitoring is punishable on summary conviction by a fine of up to XCD 100 000 (AML/CFT Regulations, Sec. 10). Failure to keep the necessary records, including ownership information, is punishable on summary conviction by a fine of up to XCD 50 000. 130. For bearer shares, the Custody of Bearer Shares Regulations do not provide penalties for failure to comply, but direct that a bearer share is disabled for any period during which it is held by a person other than a custodian. However, a custodian would be subject to the AML laws and subsequent penalties, with the exception of a custodian who is a foreign regulated person. Instead, a foreign regulated person would be subject to the AML regime of his/her home country, which must be consistent with the FATF Recommendations. The penalty for a foreign regulated person for not complying is to be disqualified as custodian by the FSC. 131. Under the LLC Act there is no penalty for a failure to keep records and there is no specific penalty for failure to register. This could be an impediment to availability of information. However, because an LLC must have a registered agent who is a licensed service provider, it is difficult to imagine a situation where an LLC would not be registered. There is a penalty for a person knowingly making an untrue or misleading report or return of XCD 25 000 for a corporation and the same fine and/or 1 year imprisonment for an individual. The penalty for an LLC carrying on a prohibited business or activity is XCD 25 000 for a corporation and the same penalty and/or 6 months imprisonment for an individual. 132. The Banking Act provides that any company that carries on a banking business without registering is subject upon summary conviction to a fine of XCD 500 000, and 5 000 for each day of the violation. For a director or manager the penalty is a fine of XCD 250 000 and/or imprisonment for 3 years. Any person, including a domestic bank, who carries on an offshore banking or trust company business without a licence is liable upon summary conviction to a fine of XCD 25 000 and/or imprisonment of two years under the TCOBA. An offshore bank that fails to have a registered office and two agents is subject to a penalty of XCD 25 000. The penalty for failure to change the address of its principal office or agent without prior written approval by the Inspector of Trust Companies and Offshore Banks is a fine of XCD 10 000. 133. Under the Protect Cell Companies Act, any person who makes a statement or declaration that he/she knows or has reasonable grounds to believe is false, deceptive or misleading in a material way, who fails to comply with a condition or requirement to keep records, or who discloses ones status as a PCC or for a protected cell representative who fails to perform his/her duty is

liable on summary conviction to a fine of XCD 5 000 or imprisonment for 12 months or both (Sec. 29). 134. For service providers, the Company Management Act provides that any person, who with the intent to deceive or for any purpose of this Act, makes any representation that he/she knows to be false or does not believe to be true commits an offense and is liable upon summary conviction to a fine of XCD 25 000, imprisonment or both. 135. Under the Insurance Act, a person who makes a representation he/ she believes to be untrue is guilty of an offence and liable on summary conviction to a fine of XCD 10 000 and 2 years imprisonment. Any person who contravenes or fails to comply with the Act is liable to a fine of XCD 5 000 and/or imprisonment for 1 year. For failure to file for a licence with the FSC the penalty is XCD 25 000 and/or imprisonment for 1 year. 136. Anguilla advises that the FSC Act is currently being revised with emphasis on enhanced supervisory powers and a wider range of sanctions, as recommended by the CFATF Mutual Evaluation Report of July 2010. Currently, the Act provides for penalties for failure to make information available to the FSC, which is punishable on indictment or summary conviction by a fine of up to XCD 25 000 or, for individuals, imprisonment for up to 1 year (FSC Act, Schedule 4). Providing information, making a representation or submitting a return that he/she knows to be false or materially misleading or does not believe to be true is punishable, on summary conviction, with the same penalty. 137. For general partnerships, the Partnership Act does not provide for any penalties for failure to comply with its requirements. Anguilla advises that failure to comply would give rise to a cause of action in tort for breach of duty. 138. Under the Trades, Business, Occupations and Professions Licensing Act (TBOPL Act), failure of a partnership to obtain a licence is punishable on summary conviction by a fine of XCD 2 500 or imprisonment for a maximum of 3 months, and, in the case of a continuing offense, a further fine of XCD 250 for each day the offence continues. 139. Under the LP Act there are penalties for failure to comply, the most serious being for filing a false or misleading return or report, which is a fine of XCD 25 000 for a corporation and the same fine and/or 6 months imprisonment for an individual. For a general partner, failure to register a change of registered office or registered agent or a change of other particulars results in a penalty of XCD 10 000 for both a body corporate and an individual. Failure to file an annual return results in a fine of XCD 5 000 for a corporation or individual and failure to maintain records is penalized by an XCD 10 000 fine for an individual or a body corporate.
140. There are not specific penalties under the Trusts Act, however, a trust can be enforced by a court and a trustee can be removed (Sec. 56). 141. A foundation that does not have a registered agent who is a regulated person commits an offense under the Foundations Act and is liable to a penalty of XCD 500 (the equivalent of the annual fee). The same penalty applies in the case of a failure to keep accounts and records (Foundation Regulations, Part 2(3), (4) and (5)). 142. The effectiveness of the enforcement provisions which are in place in Anguilla will be considered as part of the Phase 2 Peer Review.
Determination and factors underlying recommendations
Determination The element is in place, but certain aspects of the legal implementation of the element need improvement. Factors underlying recommendations Ownership and identity information for LLCs is not required upon registration and an LLC is not expressly required to maintain this information. Although there are some obligations for registered agents to maintain ownership information under the AML laws, this is not necessarily sufficient to ensure availability of ownership information in all cases. Anguillan law only requires a service provider to obtain identity information on beneficiaries of a trust in cases of a higher level of risk for AML/CFT purposes. Recommendations Anguilla should ensure that ownership and identity information is available for all entities.
Anguilla should amend its legislation to require a trustee to obtain identification information on the beneficiaries of a trust in all cases.
Anguilla should ensure that ownership Ownership and identity information may not be available in all instances in and identity information on bearer shares is available in all instances. the case of a bearer share held by a foreign custodian.
A.2. Accounting records

Jurisdictions should ensure that reliable accounting records are kept for all relevant entities and arrangements.
General requirements (ToR A.2.1)

143. The Terms of Reference sets out the standards for the maintenance of reliable accounting records and the necessary accounting record retention period. It provides that reliable accounting records should be kept for all relevant entities and arrangements. To be reliable, accounting records should; (i) correctly explain all transactions, (ii) enable the financial position of the entity or arrangement to be determined with reasonable accuracy at any time; and (iii) allow financial statements to be prepared. Accounting records should further include underlying documentation, such as invoices, contracts, etc. Accounting records need to be kept for a minimum of five years.
Ordinary Companies and Protected Cell Companies

144. All OCs must keep accounting records that are sufficient to record and explain the transactions of the company and will, at any time, enable the financial position of the company to be determined with reasonable accuracy (Companies Act, Sec. 126). Pursuant to the PCC Act, a PCC is also subject to the accounting requirements in Sections 126 and 127 of the Companies Act. These records must contain: entries from day to day of all sums of money received and expended by the company and the matters in respect of which the receipt and expenditure takes place details of all sales and purchases of goods by the company a record of the assets and liabilities of the company. 145. If the accounting records of an OC or PCC are kept outside Anguilla, it must keep at its registered office accounts and returns adequate to enable the directors of the company to ascertain the financial position of the company with reasonable accuracy on a quarterly basis and a written record of the place or places outside Anguilla where its accounting records are kept.
IBCs
146. An IBC must keep accounting records that are sufficient to record and explain the transactions of the company and will, at any time, enable the financial position of the company to be determined with reasonable accuracy. Such books and records must be kept at the registered office of the IBC or at such other place as the directors may by resolution determine (IBC Act, Sec. 65).
147. An IBC must also keep a register of all relevant charges created by the company, a charge being defined as any form of security interest, whether fixed or floating, over property, wherever situated, other than an interest arising by operation of law (Sec. 76).
LLCs
148. An LLC must maintain records relating to the true and full information regarding the status of the business and financial condition of the LLC. This includes records relating to a true and full information regarding the amount of cash and a description and statement of the agreed value of any other property or services contributed by each member and that each member has agreed to contribute in the future; and such other information regarding the affairs of the LLC as is just and reasonable. This does not meet the standard in the Terms of Reference as it is not clear that such records would explain all transactions and it is unclear what records would be considered just and reasonable. The Anguillan authorities maintain that pursuant to generally accepted accounting principles, the accounting records must be such that an audit trail can be reconstructed and the transactions readily understood. However, this is not expressly stated in the law.
General and Limited Partnerships

149. As a partnership is a fiduciary arrangement under the common law, a partner has a duty to produce accounts for the benefit of all partners. In addition, section 29 of the Partnership Act requires that partners keep true accounts and full information of all things affecting the partnership and render them to any partner or his/her agents. 150. The LP Act provides that a general partner of an LP is also bound by the requirements of the Partnership Act (Sec. 10). Therefore, a general partner in an LP is subject to the accounting requirement of Section 29 of the Partnership Act. In addition, Section 9(5) of the LP Act provides that a limited partner may inspect, take copies of and take extracts from the books and records of the limited partnership and demand of and receive from a general partner true and full information regarding the state of the partnership business and its financial condition. These requirements lack specificity and may not ensure that records consistent with the standards are kept in all cases and therefore are not consistent with the standard envisaged by the Terms of Reference. The Anguillan authorities maintain that the accounting records must be such that an audit trail can be reconstructed and the transactions readily understood, however this is not expressly provided in the law.
Trusts
151. All trustees are required by Section 27 of the Trusts Act to provide, upon request, full and accurate information as to the state and amount of the trust property and the conduct of the trust administration. This requires that all trustees maintain the information necessary to comply with such a request, including information relating to any other trustees, settlors, and beneficiaries. However, this does not meet the international standard, as it is not clear that such records would correctly explain all transactions, allow financial statements to be prepared and enable the financial position of the trust to be determined with reasonable accuracy at any time.
Foundations
152. The Foundations Act requires that foundations keep such accounts and records as its council considers necessary or desirable in order to reflect the financial position of the foundation (Sec. 37). This standard is ambiguous, as it is unclear what records this would require. The Anguillan authorities again maintain that the accounting records must be such that an audit trail can be reconstructed and the transactions readily understood, however this is not expressly stated in the law. 153. Such accounts may be kept at the registered address of the foundation or at such other place as the council may designate and must be kept open to inspection by the registered agent, the council members, and, where applicable, its secretary, guardian or auditor (Sec. 37(3)). If the books are kept at a place other than the registered address, the registered agent shall be notified of the location where books are kept and upon request must be provided with such books within a reasonable time. Where the records are kept outside of Anguilla, the foundation must ensure that it keeps at its registered office accounts and returns adequate to enable the council members to ascertain, on a quarterly basis, the financial position of the foundation with reasonable accuracy and a written record of the place or places outside Anguilla where its accounting records are kept.
Mutual Funds
154. Pursuant to the Mutual Fund Act, every mutual fund must maintain adequate accounting records and prepare financial statements in respect of each financial year in accordance with generally accepted accounting principles. If the fund is a company, it must keep such records mandated by the Companies Act or if a partnership, the same as those proscribed by the Partnership Act. These records must be made available to the FSC upon request.
AML/CFT requirements
155. Service providers under the AML/CFT Code are required to retain records relating to transactions with customers, including the name and address of the customer, the currency and amount of transaction, the customers account number, the date of the transaction, the details of the counterparty and the nature and details of the transaction. It must also keep all customer files and business correspondence relating to the relationship or occasional transaction. Such records must contain sufficient details to enable the transaction to be understood and to enable an audit trail of the movement of funds (Sec. 36). However, the AML requirements will only apply in certain cases, where a person subject to those rules is responsible for undertaking the entitys recordkeeping generally. 156. In sum, Anguillas laws do not provide for adequate records in respect of accounts in all cases. Specifically, the recordkeeping requirements for LLCs, partnerships and foundations are unclear and should be revised in line to the Terms of Reference.
Underlying documentation (ToR A.2.2)

157. Anguillan law does not require the retention of underlying documents in line with the Terms of Reference for any entity. Anguillas AML/CFT regime does require that Service Providers maintain supporting documents, however this would only apply in limited cases where a service provider is responsible for undertaking the entitys recordkeeping generally.
Document retention (ToR A.2.3)

158. Foundations in Anguilla have a document retention period of six years, consistent with the standard. Additionally, in limited cases where accounting information is retained pursuant to Anguillas AML/CFT regime information is subject to a five year retention period. No other entities in Anguilla are required to retain documents for the five year period envisaged by the standard and this is a significant gap in its laws. Anguilla should revise its laws to require that records of accounts, including underlying documentation, for all entities are kept for a minimum of five years in line with the standard.

Determination The element is not in place. Factors underlying recommendations There are currently no consistent requirements on LLCs, partnerships, trusts and foundations to retain reliable accounting records. Recommendations Anguillas accounting record requirements for LLCs, partnerships, trusts and foundations should be clarified to ensure that reliable accounting records are required to be maintained. Anguilla should ensure that its laws require that accounting records which include underlying documentation are kept for all relevant entities and arrangements. Anguilla should ensure that its laws require that accounting records are kept for all relevant entities and arrangements for a minimum of five years.
There are currently no express requirements for any relevant entities to retain accounting records which include underlying documentation. Most entities, with the exception of foundations, are not required to retain accounting records for a minimum five year period aside from the limited records required to be retained pursuant to the AML laws.
A.3. Banking information

Banking information should be available for all account-holders.
Record-keeping requirements (ToR A.3.1)

159. The source of the record keeping requirements for banks and other financial institutions is Anguillas AML/CFT regime. Such entities fall within the definition of service provider for AML/CFT purposes and are therefore subject to the AML/CFT Code and Regulations. The FSC is the supervisory authority for AML/CFT purposes.9
9.
However, it is noted that domestic commercial banks are not regulated by the FSC, and instead are regulated by the ECCB. This was flagged as a concern in the recent CFATF report and Anguilla advises that it is developing legislation to address this potential deficiency.
160. Pursuant to the AML/CFT Regulations, all banks and other financial institutions are required to maintain all records pertinent to accounts, including related financial and transactional information. Specifically, Section 17 provides that the following records must be kept by all service providers when they form a business relationship or carry out an occasional transaction: a record containing details relating to each transaction carried out by the service provider in the course of any business relationship or occasional transaction; all account files; and all business correspondence relating to a business relationship or an occasional transaction. 161. The Regulations further specify that the records must include sufficient information to enable the reconstruction of individual transactions (Sec. 17(3)) and that records must be kept in a form that enables them to be made available on a timely basis when lawfully required. 162. The AML/CFT Code further provides that records relating to transactions with customers must contain the following information concerning each transaction: the name and address of the customer; if the transaction is monetary, the currency and the amount of the transaction; if the transaction involves a customers account, the number, name or other identifier for the account; the date of the transaction; the details of the counterparty, including account details; the nature of the transaction; and the details of the transaction (Sec. 35). 163. The AML/CFT Code also requires that transaction records must contain sufficient details to enable a transaction to be understood and enable an audit trail of the movements of incoming and outgoing funds or asset movements to be readily constructed. 164. A bank or financial institution (service provider) that fails to meet these record keeping requirements is guilty of an offence and is liable, on summary conviction, to a fine of XCD 50 000, in addition to any civil or administrative penalties that may be imposed.

165. Both the AML/CFT Code and Regulations require that records of transactions be kept for a period of no less than five years from the date of the transaction (Sec. 18). 166. In sum, Anguillas AML/CFT regime covers all banks and financial entities. It includes standards for maintenance and retention of account and transaction records and requires their retention for the requisite 5 year period.
Determination The element is in place.
COMPLIANCE WITH THE STANDARDS: ACCESS TO INFORMATION 45
B. Access to Information
Overview
167. A variety of information may be needed in a tax enquiry and jurisdictions should have the authority to obtain all such information. This includes information held by banks and other financial institutions as well as information concerning the ownership of companies or the identity of interest holders in other persons or entities, such as partnerships and trusts, as well as accounting information in respect of all such entities. This section of the report examines whether Anguillas legal and regulatory framework gives the authorities access powers that cover the right types of persons and information and whether rights and safeguards would be compatible with effective exchange of information. 168. The Anguillan authorities power to access information for tax purposes are derived from the International Co-operation (Tax Information Exchange Agreements) Act of 2009 (ICTIEA Act), which allows the Anguillan authorities to carry out the terms of its TIEAs. The Act designates the Permanent Secretary of Finance of the Ministry of Finance as the Competent Authority for exchange of information purposes. It gives the Permanent Secretary broad authority to access information, including financial and accounting information in line with the Terms of Reference. 169. There is no domestic tax interest requirement in Anguillan law. The authorities can essentially access information from any person even if it is not required to be held and even if they do not need it for their own tax purposes. Because of their broad powers and sufficient penalties in place, Anguillan authorities have the power to compel information. 170. Anguillan law provides for safeguards to protect confidential information, such as information that is subject to attorney-client privilege. However, Anguillas Confidential Relationships Act (CRA) and the ICTIEA Act seem to conflict on the issue of confidentiality. This could impede access to information, therefore the report makes a recommendation that this be clarified and
46 COMPLIANCE WITH THE STANDARDS: ACCESS TO INFORMATION

element B.1. is found to be in place but certain aspects of the legal implementation of the element need improvement. 171. The rights and safeguards that apply to persons in Anguilla appear to be compatible with effective exchange of information and therefore element B.2. is found to be in place.
B.1. Competent Authoritys ability to obtain and provide information

Competent authorities should have the power to obtain and provide information that is the subject of a request under an exchange of information arrangement from any person within their territorial jurisdiction who is in possession or control of such information (irrespective of any legal obligation on such person to maintain the secrecy of the information).
Ownership and identity information (ToR B.1.1) and accounting records (ToR B.1.2)
172. Competent authorities should have the power to obtain and provide information held by banks, other financial institutions, and any person acting in an agency or fiduciary capacity including nominees and trustees, as well as information regarding the ownership of companies, partnerships, trusts, foundations, and other relevant entities including, to the extent that it is held by the jurisdictions authorities or is within the possession or control of persons within the jurisdictions territorial jurisdiction, ownership information on all such persons in an ownership chain.10 Competent authorities should also have the power to obtain and provide accounting records for all relevant entities and arrangements.11 173. Section 5 of the ICTIEA Act provides that the Permanent Secretary may require any person in Anguilla to provide any information that the Permanent Secretary may require with respect to a request for assistance by a requesting party. A person from whom this information is requested has a statutory duty to provide such information within the time requested (Sec. 6). A person is defined under the Interpretation and General Clauses Act (s1) to include any corporation, either aggregate or sole, and any club, society, association or other body, of one or more persons. This definition is sufficiently broad to include all entities in Anguilla, including banks, and financial institutions and any person acting in an agency or fiduciary capacity, including nominees and trustees.
10. 11.
See OECD Model TIEA Article 5(4). See JAHGA Report paragraphs 6 and 22.
174. The Permanent Secretarys powers under the ICTIEA Act also extend to accounting information. The term information is defined broadly in Section 1 to cover any fact, statement or record in any form whatever that is relevant or material to tax administration and enforcement.
Use of information gathering measures absent domestic tax interest (ToR B.1.3)
175. The ICTIEA Act is clear that its competent authority may access any information from any person (Sec. 5). The competent authority may only decline a request for information in limited circumstances, none of which include a domestic tax interest requirement. 176. Further, the exercise of the competent authoritys powers is not dependent on whether or not a person is required to have the information or if the information is required to be held; the competent authoritys powers extend to the actual holder of the information. No distinction is made as to whether the person in possession of the information is required to be in possession of it or not (see Section 5, ICTIEA Act).
Compulsory powers (ToR B.1.4)

177. Section 10 of the ICTIEA Act prescribes penalties for failure to comply with a request for information. A person who fails to provide information in compliance with a request made under the Act is liable on summary conviction to a fine of XCD 10 000 or to imprisonment for a term of 2 years, or both. The same penalty applies for a person who wilfully tampers with or alters such information, or who without lawful excuse, destroys or damages any information which the Permanent Secretary has directed that person to provide. 178. If a bank or financial institution fails to comply with a request, it may also be subject to criminal penalties under the AML/CFT regime and administrative sanctions and penalties under the FSC Act. Such penalties would include a fine of up to XCD 25 000 or, for individuals, imprisonment for up to 1 year (FSC Act, Schedule 4). Failure to carry out customer due diligence or ongoing monitoring under the AML regime is punishable on summary conviction by a fine of up to XCD 100 000 (AML/CFT Regulations, Sec. 10). 179. The ICTIEA Act is silent on the issue of search and seizure and therefore does not provide for this power. Anguilla advises that its policy makers are considering amendments to the ICTIEA Act to expand the competent authoritys powers. Because the ICTIEA Act contains penalties for failure to provide information (including possible imprisonment), there are adequate

compulsory powers in place in Anguilla. Nonetheless, it is recommended that search and seizure powers be added in any expansion of the current law.
Secrecy provisions (ToR B.1.5)

180. Jurisdictions should not decline on the basis of its secrecy provisions (e.g., bank secrecy, corporate secrecy) to respond to a request for information made pursuant to an exchange of information mechanism. 181. Anguilla, being a common law jurisdiction, respects the general common law principles relating to confidentiality. Under the common law applicable in Anguilla, banks and all other financial institutions have a duty to keep the business affairs of their customers confidential except where disclosure is under compulsion of law, where there is a duty to the public to disclose the information, where the interests of the bank or other financial institution require disclosure or where disclosure is made by the express or implied consent of the customer. These common law principles do not prevent the provision of information under legislation providing for the exchange of information pursuant to an international agreement. 182. Anguillan law includes protections for information that is subject to attorney-client privilege. Specifically, the ICTIEA Act allows the competent authority to decline a request for assistance where Anguillas laws protect such information from disclosure on the grounds that it constitutes or would reveal a privileged communication (Sec. 4(1)(b)). Privileged communication is defined at Section 1 as any information or other matter that comes to a professional legal advisor in privileged circumstances if it is communicated or given to him or her: a. by, or by a representative of, a client of his or hers in connection with the giving by the advisor of legal advice to the client; or b. by, or by a representative of, a person seeking legal advice from the advisor; or c. by a person in connection with legal proceedings or contemplated legal proceedings. 183. This standard would apply in the case of five of Anguillas 17 TIEAs, which do not expressly define the term legal privilege. Anguilla advises that they interpret part c) to include a scenario where a person not representing the client supplies information to the legal advisor in relation to (contemplated) legal proceedings against a client of the legal advisor. This would include, e.g., banks. The information that is given by this person, therefore, will be treated as a privileged communication as it relates to legal proceedings against a client of the legal advisor. This could be overbroad, however, because it appears to include not only information communicated between an
attorney and a client but also between an attorney and another person who is not the client in connection with legal proceedings. This will be the subject of further review in Phase 2 of the Peer Review of Anguilla. 184. Anguillas domestic laws conflict on the issue of secrecy. Subject to enumerated exceptions, the Confidential Relationships Act (CRA), applies to all confidential information with respect to business of a professional nature that arises in or is brought into Anguilla and to all persons who come into possession of that information at any time thereafter, whether within or outside Anguilla. Confidential information is defined as information concerning any property, or relating to any business of a professional nature or commercial transaction that has taken place, or that any party concerned contemplates may take place, that the recipient thereof is not, otherwise than in the normal course of business or professional practice, authorised by the principal to divulge. 185. While the CRA specifically excepts information provided pursuant to the Banking Act or the FSC Act, it does not expressly exclude information provided pursuant to the ICTIEA Act (CRA, Section 2(2)). Therefore, it is possible that someone who divulges information pursuant to a request from the competent authority would violate the CRA by providing such information. 186. Further, the fact that both the Banking Act12 and the FSC Act13 contain specific exclusions to their respective confidentiality provisions for information provided pursuant to the ICTIEA Act makes this omission more troublesome. 187. Section 7 of the ICTIEA Act provides an absolute defence to any claim brought against a person in respect of any act done in good faith in compliance with a direction from the competent authority to provide information. Anguilla contends that this would clearly provide a defence against any claims arising under the common law, or any legislation imposing
12. Section 32 of the Banking Act, which applies to the domestic banking sector, prohibits the disclosure of information by persons who have acquired that information, including employees or agents of the Eastern Caribbean Central Bank (ECCB), except inter alia, when lawfully required to make disclosure by any court within Anguilla; or under the provisions of any law of Anguilla. Such law would include the ICTIEA Act and therefore the competent authoritys powers under the ICTIEA Act would override secrecy provisions in the Banking Act. Section 24 of the FSC Act provides that no Board member, Commission employee or other person acting under the authority of the Commission shall disclose protected information to any other person. However, this prohibition does not apply, to a disclosure required or permitted by any court of competent jurisdiction in Anguilla or required or permitted by any other Act (including the ICTIEA Act).
13.

restrictions on the disclosure of confidential information. They also advise that they made a policy decision to locate the exception to the CRA within the act requiring the disclosure, rather than the CRA itself. However, because the laws are not clear, there remains a conflict between the ICTIEA Act and the CRA which could be an impediment to the exchange of information considered confidential under the CRA. Anguilla should clarify its laws in this regard. According to the Anguillan authorities, a bill for an Act to amend section 7 of the ICTIEA Act has been drafted. As amended, section 7 will provide that a disclosure made pursuant to the ICTIEA Act does not constitute a contravention of the CRA or any law in effect in Anguilla. 188. Anguilla further advises that it does not decline to respond to a request for information made pursuant to an exchange of information mechanism on the basis of its secrecy provisions. This was also concluded by CFATF in its 3rd Round Mutual Evaluation of Anguillas AML/CFT regime.
Determination The element in place, but certain aspects of the legal implementation of the element need improvement. Factors underlying recommendations Anguillas Confidential Relationships Act does not expressly provide an exception for information provided pursuant to its ICTIEA Act or its tax treaties. Recommendations Anguilla should ensure that the competent authority has the express power to access all information, including confidential information.
B.2. Notification requirements and rights and safeguards

The rights and safeguards (e.g. notification, appeal rights) that apply to persons in the requested jurisdiction should be compatible with effective exchange of information.
Not unduly prevent or delay exchange of information (ToR B.2.1)

189. Rights and safeguards should not unduly prevent or delay effective exchange of information.14 For instance, notification rules should permit exceptions from prior notification (e.g., in cases in which the information request is of a very urgent nature or the notification is likely to undermine the chance of success of the investigation conducted by the requesting jurisdiction).
14. See OECD Model TIEA Article 1.
190. Pursuant to Section 6 of the ICTIEA Act, a person on whom notice has been served under Section 5 shall provide the information within the period specified in the notice, which shall be 28 days, from the day the notice is served. The Permanent Secretary has the authority to allow for more time at his discretion, and may extend the period of time in the notice if he believes that the circumstances warrant it. In addition, information obtained by the Permanent Secretary pursuant to a notice must be kept confidential and may not be provided to the requesting party for 20 days. The Anguillan authorities maintain that the Permanent Secretary uses these 20 days to review the information to assess whether or not the information obtained falls within any of the grounds for declining a request, with a goal of preventing or minimising incidents of judicial review and to safeguard against potential liability for improper disclosures. They also note that the 20 days will be factored in when seeking to meet the time limits under its TIEAs and would not cause undue delay. Whether the Permanent Secretarys discretion or requirement to retain information for 20 days would delay the exchange of information in practice should be monitored in the Phase 2 peer review of Anguilla. 191. The ICTIEA Act does not require that the competent authority notify the taxpayer who is the subject of a request for information. Anguilla advises that the competent authority could notify such person at his discretion. 192. Judicial review of a decision of the competent authority is available in Anguilla. A person aggrieved by a decision made by the competent authority has a right to seek review of the decision by the High Court of Anguilla under the ICTIEA Act (Sec. 12).
COMPLIANCE WITH THE STANDARDS: EXCHANGING INFORMATION 53
C. Exchanging Information
Overview
193. Jurisdictions generally cannot exchange information for tax purposes unless they have a legal basis or mechanism for doing so. This section of the report examines whether Anguilla has a network of information exchange that would allow it to achieve effective exchange of information in practice. 194. Anguillas policy has been to negotiate EOI agreements based on the OECDs Model TIEA, rather than double tax conventions. Over the past 2 years, Anguilla has actively pursued a course of negotiating TIEAs, concluding 17 agreements since 2009.15 Six of these agreements are currently in force and Anguilla anticipates that the remaining agreements will soon come into force. Also, a DTC applies between Anguilla and Switzerland which is an extension of a former DTC (1954) between the United Kingdom and Switzerland. This agreement is not to the standard. Anguilla was not aware that the treaty existed and recently its Executive Council has made a request to the Government of the United Kingdom that the extension of this DTC to Anguilla be terminated with immediate effect. The DTC with Switzerland is not further considered in this section, which will focus on whether Anguillas TIEAs allows it to effectively exchange information. 195. The legal authority to exchange information in Anguilla derives from its TIEAs, which have been brought into force by the ICTIEA Act. Anguilla also automatically exchanges information with EU countries pursuant to the EU Savings Directive, which is implemented in domestic law by bilateral agreements with each EU member state pursuant to the Reporting of Savings
15. Anguilla is entrusted to sign tax information exchange agreements, double taxation agreements and ancillary agreements by the UK Government with countries which are members of the G20, OECD and EU, as well as all jurisdictions which are on the OECDs white list of jurisdictions which have substantially implemented the international standard. Entrustments to cover jurisdictions other than those mentioned above can be granted by the UK Government on an ad-hoc basis.
54 COMPLIANCE WITH THE STANDARDS: EXCHANGING INFORMATION

Income Information (European Union) Law (2007) Revision and was given effect by the Mutual Legal Assistance (Tax Matters) Act (2006). 196. Anguillas TIEAs are based on the OECD Model TIEA and follow it closely. Therefore, Anguillas 17 TIEAs meet the international standard for exchange of information.
C.1. Exchange-of-information mechanisms

Exchange of information mechanisms should allow for effective exchange of information.
Foreseeably relevant standard (ToR C.1.1)

197. The international standard for exchange of information envisages information exchange to the widest possible extent. Nevertheless, it does not allow for fishing expeditions, i.e. speculative requests for information that have no apparent nexus to an open inquiry or investigation. The balance between these two competing considerations is captured in the standard of foreseeable relevance which is included in paragraph 1 of Article 26 of the OECD Model Tax Convention set out below: The competent authorities of the contracting states shall exchange such information as is foreseeably relevant to the carrying out of the provisions of this Convention or to the administration or enforcement of the domestic laws concerning taxes of every kind and description imposed on behalf of the contracting states or their political subdivisions or local authorities in so far as the taxation thereunder is not contrary to the Convention. The exchange of information is not restricted by Articles 1 and 2. 198. All of Anguillas TIEAs use the word foreseeably relevant in the scope of the agreement, consistent with the OECD Model. 199. Six16 of Anguillas TIEAs provide that the contracting parties are not obligated to provide information that is either older than a legally required time period for retention or where the information is in fact no longer kept. Of these six, two provide specific time periods: five years in the case of Anguillas TIEA with Germany and six in its TIEA with Australia.
16.
TIEAs with the Netherlands, Denmark, New Zealand, the UK, Germany and Australia.
In respect of all persons (ToR C.1.2)

200. For exchange of information to be effective it is necessary that a jurisdictions obligation to provide information is not restricted by the residence or nationality of the person to whom the information relates or by the residence or nationality of the person in possession or control of the information requested. For this reason, the international standard for exchange of information envisages that exchange of information mechanisms will provide for exchange of information in respect of all persons. 201. All of Anguillas TIEAs contain a provision concerning jurisdictional scope which is equivalent to Article 2 of the OECD Model TIEA. In ten of Anguillas TIEAs the provision is identical to the Model. In six17 other TIEAs there is additional language regarding citizenship and nationality; specifically that the agreement will be applied without regard to whether the person to whom the information relates is a resident, national or citizen of a Party, or whether the person by whom the information is held is a resident, national or citizen of a party. This is additive and not restrictive.
Obligation to exchange all types of information (ToR C.1.3)

202. Jurisdictions cannot engage in effective exchange of information if they cannot exchange information held by financial institutions, nominees or persons acting in an agency or a fiduciary capacity. Both the OECD Model Convention and the Model Agreement on Exchange of Information, which are the authoritative sources of the standards, stipulate that bank secrecy cannot form the basis for declining a request to provide information and that a request for information cannot be declined solely because the information relates to an ownership interest. 203. Anguillas 17 TIEAs all contain Article 5(4)(a) and (b) from the Model TIEA which provide that information held by banks, financial institutions, agents and fiduciaries must be exchanged as well as information regarding ownership. In addition, TIEAs with the UK, France, Canada, the Netherlands, Denmark and Ireland also provide that a competent authority has the authority to obtain and provide information regarding the legal and beneficial ownership of companies.
Absence of domestic tax interest (ToR C.1.4)

204. The concept of domestic tax interest describes a situation where a contracting party can only provide information to another contracting party if it has an interest in the requested information for its own tax purposes. An
17. Australia, UK, the Netherlands, Denmark, New Zealand and Ireland.

inability to provide information based on a domestic tax interest requirement is not consistent with the international standard. Contracting parties must use their information gathering measures even though invoked solely to obtain and provide information to the other contracting party. All of the exchange of information agreements concluded by Anguilla allow information to be obtained and exchanged notwithstanding that it is not required for any domestic tax purpose.
Absence of dual criminality principles (ToR C.1.5)

205. The principal of dual criminality provides that assistance can only be provided if the conduct being investigated (and giving rise to an information request) would constitute a crime under the laws of the requested country if it had occurred in the requested country. In order to be effective, exchange of information should not be constrained by the application of the dual criminality principle. None of the exchange of information agreements concluded by Anguilla apply the dual criminality principle to restrict the exchange of information.
Exchange of information in both civil and criminal tax matters (ToR C.1.6)
206. Information exchange may be requested both for tax administration purposes and for tax prosecution purposes. The international standard is not limited to information exchange in criminal tax matters but extends to information requested for tax administration purposes (also referred to as civil tax matters). All of the exchange of information agreements concluded by Anguilla provide for the exchange of information in both civil and criminal tax matters.
Provide information in specific form requested (ToR C.1.7)

207. All of Anguillas TIEAs follow Article 5(3) of the Model, providing that the requested party, to the extent allowable under its domestic laws, shall provide information in the form of depositions of witnesses and authenticated copies of original documents. 208. Further, the ICTIEA Act provides that, where a request stipulates, the Permanent Secretary shall obtain the information in the form of depositions of witnesses or original documents or copies of original documents as the laws and administrative practices of Anguilla permit (Sec. 11).
In force (ToR C.1.8)

209. Exchange of information cannot take place unless a jurisdiction has exchange of information arrangements in force. Where exchange of information agreements have been signed the international standard requires that jurisdictions must take all steps necessary to bring them into force expeditiously. 210. Of Anguillas 17 TIEAs, only six are in force (see Annex 2). With regard to the remaining 11 of 17 TIEAs signed to date, Anguilla advises that as at May 2011, had completed all of its internal procedures necessary for bringing nine of them into force and is now waiting for action from the other parties.
In effect (ToR C.1.9)

211. For information exchange to be effective the parties to an exchange of information arrangement need to enact any legislation necessary to comply with the terms of the arrangement. Anguilla has enacted domestic legislation, specifically the ICTIEA Act, to give effect to its arrangements for exchange of information for tax purposes. 212. Additionally, there are some issues concerning the ability of Anguillas authorities to use their information gathering measures in order to respond to a request for information when such information would be considered confidential.
C.2. Exchange-of-information mechanisms with all relevant partners

The jurisdictions network of information exchange mechanisms should cover all relevant partners.
213. Ultimately, the international standard requires that jurisdictions exchange information with all relevant partners, meaning those partners who are interested in entering into an information exchange arrangement. Agreements cannot be concluded only with counterparties without economic significance. If it appears that a jurisdiction is refusing to enter into agreements or negotiations with partners, in particular ones that have a reasonable expectation of requiring information from that jurisdiction in order to properly administer and enforce its tax laws it may indicate a lack of commitment to implement the standards.

214. The policy of Anguilla with respect to expanding its EOI network has been to focus on jurisdictions which are either OECD or G20 members. It has signed agreements with 17 jurisdictions, 15 of which are OECD member countries. Anguilla should continue to develop its EOI network, including with jurisdictions with foreign direct investment into Anguilla. 215. It is noted that Anguilla does not have an information exchange agreement with its main economic partner, the United States. However, comments were sought from the jurisdictions participating in the Global Forum, and in the course of preparation of this report, no jurisdiction advised that Anguilla had refused to negotiate or enter into an agreement.
Determination The element is in place. Factors underlying recommendations Recommendations Anguilla should continue to develop its EOI network with all relevant partners.
C.3. Confidentiality
The jurisdictions mechanisms for exchange of information should have adequate provisions to ensure the confidentiality of information received.
216. Governments would not engage in information exchange without the assurance that the information provided would only be used for the purposes permitted under the exchange mechanism and that its confidentiality would be preserved. Information exchange instruments must therefore contain confidentiality provisions that spell out specifically to whom the information can be disclosed and the purposes for which the information can be used. In addition to the protections afforded by the confidentiality provisions of information exchange instruments countries with tax systems generally impose strict confidentiality requirements on information collected for tax purposes. 217. The text of Article 26(2) of the OECD Model Tax Convention reads: Any information received under paragraph 1 by a Contracting State shall be treated as secret in the same manner as information obtained under the domestic laws of that State and shall be disclosed only to persons or authorities (including courts and administrative bodies) concerned with the assessment or collection of, the enforcement or prosecution in respect of, the determination
of appeals in relation to the taxes referred to in paragraph 1, or the oversight of the above. Such persons or authorities shall use the information only for such purposes. They may disclose the information in public court proceedings or in judicial decisions.
Information received: disclosure, use, and safeguards (ToR C.3.1) and all other information exchanged (ToR C.3.2)
218. Twelve of Anguillas 17 TIEAs contain the language in the Model TIEA regarding confidentiality. Four of Anguillas TIEAs diverge slightly from the Model language, but would still protect confidentiality of information in line with the international standard. Specifically, the Anguilla-Netherlands TIEA provides that information can only be disclosed to persons or authorities (including courts and administrative bodies) concerned with the purposes specified in Article 1 and further, cannot be used for purposes other than those stated in Article 1 without the express written consent of the requested party. 219. Four of Anguillas TIEAs, with France, Portugal, Ireland and Germany, provide that information supplied to a requesting party can never be disclosed to any other jurisdiction, even with written consent as contemplated in the Model TIEA. In addition, Anguillas TIEA with Germany further specifies that information shall be kept confidential and shall be protected in the same manner as information obtained under the domestic laws of the Contracting Parties. 220. As for Anguillas domestic laws, Section 9 of the ICTIEA Act prohibits a person who is notified or required to take any action or required to supply any information from disclosing the notification or receipt of a request or supplying the information to another person, except in accordance with the agreements or the arrangement or where the disclosure of information is a privileged conversation. The Act provides a penalty for contravention of this provision of a fine of XCD 10 000 or imprisonment for 2 years or both on summary conviction. 221. The confidentiality provisions in Anguillas agreements and its domestic law do not draw a distinction between information received in response to requests and information forming part of the requests themselves. As such, these provisions would apply equally to all requests for such information, background documents to such requests and any other document reflecting such information.
C.4. Rights and safeguards of taxpayers and third parties

The exchange of information mechanisms should respect the rights and safeguards of taxpayers and third parties.
222. The international standard allows requested parties not to supply information in response to a request in certain identified situations where an issue of trade, business or other legitimate secret may arise. Among other reasons, an information request can be declined where the requested information would disclose confidential communications protected by the attorney-client privilege. Attorney-client privilege is a feature of the legal systems of many countries. 223. However, communications between a client and an attorney or other admitted legal representative are, generally, only privileged to the extent that, the attorney or other legal representative acts in his or her capacity as an attorney or other legal representative. Where attorney-client privilege is more broadly defined it does not provide valid grounds on which to decline a request for EOI. To the extent, therefore, that an attorney acts as a nominee shareholder, a trustee, a settlor, a company director or under a power of attorney to represent a company in its business affairs, information resulting from and relating to any such activity cannot be declined to be exchanged because of the attorney-client privilege rule.
Exceptions to requirement to provide information (ToR C.4.1)

224. All of Anguillas TIEAs contain a provision similar to Article 7 of the Model TIEA providing that a jurisdiction can refuse to exchange certain information. Eleven of Anguillas TIEAs contain an Article 7 provision that is identical to the Model. Five of Anguillas TIEAs differ from the Model in that they do not provide a definition of legal privilege.18 However, in this case, one would look to Anguillas domestic laws. As discussed in section B.1.5 of this report, Anguillas competent authority may decline to supply information that is subject to attorney client privilege (ICTIEA Act). This provision could be overbroad, and should therefore be the subject of further review in the Phase 2 Review of Anguilla (see Section B.1.5 above).
18.
TIEAs with Ireland, Germany, the United Kingdom, Portugal and the Netherlands. In addition, although Article 7 of the TIEA with France is not identical to the Model it does contain the identical definition for legal privilege.

C.5. Timeliness of responses to requests for information

The jurisdiction should provide information under its network of agreements in a timely manner.
Responses within 90 days (ToR C.5.1)

225. In order for exchange of information to be effective it needs to be provided in a timeframe which allows tax authorities to apply the information to the relevant cases. If a response is provided but only after a significant lapse of time the information may no longer be of use to the requesting authorities. This is particularly important in the context of international cooperation as cases in this area must be of sufficient importance to warrant making a request. 226. All but one of Anguillas TIEAs contain a provision similar to Article 5(6)(a) and (b) of the Model, and would therefore require a response within 90 days. Anguillas TIEA with Portugal provides that the requested party shall use its best endeavours to forward the requested information to the requesting party with the least reasonable delay.
Organisational process and resources (ToR C.5.2)

227. It is important that a jurisdiction have appropriate organisational processes and resources in place to ensure a timely response. A review of the practical application of these processes and the resources available will be conducted in the context of Anguillas Phase 2 review.
Absence of restrictive conditions on exchange of information (ToR C.5.3)

228. Exchange of information should not be subject to unreasonable, disproportionate or unduly restrictive conditions. There are no aspects of Anguillas exchange of information agreements that appear to impose restrictive conditions on exchange of information. Anguillas domestic laws have generally been aligned to allow for the exchange of information without restrictive conditions, with exceptions noted throughout this report. Whether these actually restrict exchange of information in practice is an issue more appropriately considered in a Phase 2 review of Anguilla.

Determination The assessment team is not in a position to evaluate whether this element is in place, as it involves issues of practice that are dealt with in the Phase 2 review.
SUMMARY OF DETERMINATIONS AND FACTORS UNDERLYING RECOMMENDATIONS 63
Summary of Determinations and Factors Underlying Recommendations

Factors underlying recommendations
Determination
Recommendations
Jurisdictions should ensure that ownership and identity information for all relevant entities and arrangements is available to their competent authorities (ToR A.1) The element is in place, but certain aspects of the legal implementation of the element need improvement. Anguillan law only requires a service provider to obtain identity information on beneficiaries of a trust in cases of a higher level of risk for AML/CFT purposes. Ownership and identity information for LLCs is not required upon registration and an LLC is not expressly required to maintain this information. Although there are some obligations for registered agents to maintain ownership information under the AML laws, this is not necessarily sufficient to ensure availability of ownership information in all cases. Ownership and identity information may not be available in all instances in the case of a bearer share held by a foreign custodian. Anguilla should amend its legislation to require a trustee to obtain identification information on the beneficiaries of a trust in all cases. Anguilla should ensure that ownership and identity information is available for all entities.
Anguilla should ensure that ownership and identity information on bearer shares is available in all instances.
64 SUMMARY OF DETERMINATIONS AND FACTORS UNDERLYING RECOMMENDATIONS

Determination
Recommendations
Jurisdictions should ensure that reliable accounting records are kept for all relevant entities and arrangements (ToR A.2) The element is not in place. There are currently no consistent requirements on LLCs, partnerships, trusts and foundations to retain reliable accounting records. Anguillas accounting record requirements for LLCs, partnerships, trusts and foundations should be clarified to ensure that reliable accounting records are required to be maintained. Anguilla should ensure that its laws require that accounting records which include underlying documentation are kept for all relevant entities and arrangements. Anguilla should ensure that its laws require that accounting records are kept for all relevant entities and arrangements for a minimum of 5 years.
There are currently no express requirements for any relevant entities to retain accounting records which include underlying documentation. Most entities, with the exception of foundations, are not required to retain accounting records for a minimum 5 year period aside from the limited records required to be retained pursuant to the AML laws. The element is in place.
Banking information should be available for all account-holders (ToR A.3) Competent authorities should have the power to obtain and provide information that is the subject of a request under an exchange of information arrangement from any person within their territorial jurisdiction who is in possession or control of such information (irrespective of any legal obligation on such person to maintain the secrecy of the information) (ToR B.1) The element is in place, but certain aspects of the legal implementation of the element need improvement. Anguillas Confidential Relationships Act does not expressly provide an exception for information provided pursuant to its ICTIEA Act or its tax treaties. Anguilla should ensure that the competent authority has the express power to access all information, including confidential information.
The rights and safeguards (e.g. notification, appeal rights) that apply to persons in the requested jurisdiction should be compatible with effective exchange of information (ToR B.2) The element is in place.
SUMMARY OF DETERMINATIONS AND FACTORS UNDERLYING RECOMMENDATIONS 65
Determination
Recommendations
Exchange of information mechanisms should allow for effective exchange of information (ToR C.1) The element is in place. The jurisdictions network of information exchange mechanisms should cover all relevant partners (ToR C.2) The element is in place. Anguilla should continue to develop its EOI network with all relevant partners.
The jurisdictions mechanisms for exchange of information should have adequate provisions to ensure the confidentiality of information received (ToR C.3) The element is in place. The exchange of information mechanisms should respect the rights and safeguards of taxpayers and third parties (ToR C.4) The element is in place. The jurisdiction should provide information under its network of agreements in a timely manner (ToR C.5) The assessment team is not in a position to evaluate whether this element is in place, as it involves issues of practice that are dealt with in the Phase 2 review.
ANNEXES 67
Annex 1: Jurisdictions Response to the Review Report 19
The Government of Anguilla would like to thank the Global Forum Secretariat, particularly Ms. Amy ODonnell and Mr. Mikkel Thunnissen, as well as the Peer Review Assessment Team, Mr. Michael Nugent of Australia and Mr. Luis Antonio Gonzalez Flores of Mexico, for their work on the Anguilla Peer Review Report. Anguilla appreciates the professionalism, thoroughness and courtesy with which phase 1 of the peer review process was conducted. Anguilla thanks its peers, who took the time to review and comment on the Anguilla report. The amendments arising from those comments enhance the clarity of the Anguilla report and its consistency with the reports of other jurisdictions. The Government of Anguilla finds the Peer Review Report an extremely useful document, setting out very clearly the areas in which there are deficiencies, as well as recommendations to address these deficiencies. One of these deficiencies relates to confidentiality and the need for clarification of the issue of whether Anguillas Confidential Relations Act might apply to information required to respond to a request. The legislative amendments necessary to put the matter beyond doubt have already been drafted and Anguilla anticipates they will be finalised and considered by the legislature in the near future. Another of these deficiencies relates to accounting information and underlying records. Anguilla accepts that the requirements regarding accounting records are not explicitly embedded in our laws in a way that meets international standards. Anguilla will therefore make every effort to correct this and ensure that accounting records meet the necessary requirements. Anguilla embraces the opportunity to enhance its information exchange regime and demonstrate its commitment to upholding the standards set by the Global Forum.
19.
This Annex presents the Jurisdictions response to the review report and shall not be deemed to represent the Global Forums views.
68 ANNEXES
Annex 2: List of all Exchange-of-Information Mechanisms in Force
Jurisdiction 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Norway Faroe Islands Greenland Netherlands Sweden Denmark New Zealand Ireland Iceland Finland United Kingdom Belgium Germany Canada Australia Portugal France Switzerland
Type of EoI Arrangement TIEA TIEA TIEA TIEA TIEA TIEA TIEA TIEA TIEA TIEA TIEA TIEA TIEA TIEA TIEA TIEA TIEA DTC
Date Signed 14.12.09 14.12.09 14.12.09 22.7.09 14.12.09 2.9.09 11.12.09 22.7.09 14.12.09 14.12.09 20.7.09 24.9.10 19.3.10 28.10.10 19.3.10 28.2.11 27.12.10 1.1.61
Date Entered Into Force 10.4.11 N/A N/A N/A N/A 10.4.11 N/A N/A N/A 10.4.11 17.2.11 N/A 11.4.11 N/A 17.2.11 N/A N/A 8.63
ANNEXES 69
Annex 3: List of all Laws, Regulations and Other Relevant Material
Anguilla Foundations Act Anguilla Foundations Regulations Anti-Money Laundering and Terrorist Financing Code Anti-Money Laundering and Terrorist Financing Regulations Banking Act Company Management Act Confidential Relationships Act Co-operative Societies Act Co-operative Societies Rules Custody of Bearer Shares Regulations Financial Services Commission Act Friendly Societies Act Friendly Societies Regulations Insurance Act International Business Companies Act International Co-Operation (Tax Information Exchange Agreement) Act Limited Liability Company Act Limited Partnership Act Mutual Funds Act Partnership Act Proceeds of Crime Act
70 ANNEXES
Protected Cell Company Act Securities Act Trades, Businesses, Occupations and Professions Licensing Act Trusts Act Trusts Companies and Offshore Banking Act
ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT

The OECD is a unique forum where governments work together to address the economic, social and environmental challenges of globalisation. The OECD is also at the forefront of efforts to understand and to help governments respond to new developments and concerns, such as corporate governance, the information economy and the challenges of an ageing population. The Organisation provides a setting where governments can compare policy experiences, seek answers to common problems, identify good practice and work to co-ordinate domestic and international policies. The OECD member countries are: Australia, Austria, Belgium, Canada, Chile, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea, Luxembourg, Mexico, the Netherlands, New Zealand, Norway, Poland, Portugal, the Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Turkey, the United Kingdom and the United States. The European Commission takes part in the work of the OECD. OECD Publishing disseminates widely the results of the Organisations statistics gathering and research on economic, social and environmental issues, as well as the conventions, guidelines and standards agreed by its members.
OECD PUBLISHING, 2, rue Andr-Pascal, 75775 PARIS CEDEX 16 (23 2011 35 1 P) ISBN 978-92-64-11764-8 No. 58585 2011
Global Forum on Transparency and Exchange of Information for Tax Purposes
PEER REVIEWS, PHASE 1: ANGUILLA

The Global Forum on Transparency and Exchange of Information for Tax Purposes is the multilateral framework within which work in the area of tax transparency and exchange of information is carried out by over 100 jurisdictions which participate in the work of the Global Forum on an equal footing. The Global Forum is charged with in-depth monitoring and peer review of the implementation of the standards of transparency and exchange of information for tax purposes. These standards are primarily reected in the 2002 OECD Model Agreement on Exchange of Information on Tax Matters and its commentary, and in Article 26 of the OECD Model Tax Convention on Income and on Capital and its commentary as updated in 2004, which has been incorporated in the UN Model Tax Convention. The standards provide for international exchange on request of foreseeably relevant information for the administration or enforcement of the domestic tax laws of a requesting party. Fishing expeditions are not authorised, but all foreseeably relevant information must be provided, including bank information and information held by duciaries, regardless of the existence of a domestic tax interest or the application of a dual criminality standard. All members of the Global Forum, as well as jurisdictions identied by the Global Forum as relevant to its work, are being reviewed. This process is undertaken in two phases. Phase 1 reviews assess the quality of a jurisdictions legal and regulatory framework for the exchange of information, while Phase 2 reviews look at the practical implementation of that framework. Some Global Forum members are undergoing combined Phase 1 plus Phase 2 reviews. The ultimate goal is to help jurisdictions to effectively implement the international standards of transparency and exchange of information for tax purposes. All review reports are published once approved by the Global Forum and they thus represent agreed Global Forum reports. For more information on the Global Forum for Transparency and Exchange of Information for Tax Purposes and for copies of the published review reports, please visit www.oecd.org/tax/transparency and www.eoi-tax.org.
Please cite this publication as: OECD (2011), Global Forum on Transparency and Exchange of Information for Tax Purposes Peer Reviews: Anguilla 2011: Phase 1: Legal and Regulatory Framework, Global Forum on Transparency and Exchange of Information for Tax Purposes: Peer Reviews, OECD Publishing. http://dx.doi.org/10.1787/9789264117655-en This work is published on the OECD iLibrary, which gathers all OECD books, periodicals and statistical databases. Visit www.oecd-ilibrary.org, and do not hesitate to contact us for more information.
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GLOBAL FORUM ON TRANSPARENCY AND EXCHANGE OF INFORMATION FOR TAX PURPOSES

Peer Review Report Phase 1 Legal and Regulatory Framework

ISBN 978-92-64-11764-8(print) ISBN 978-92-64-11765-5 (PDF)

ABOUT THE GLOBAL FORUM 5

About the Global Forum

Information and methodology used for the peer review of Anguilla

Overview of Anguilla General information on the economy and legal system

Overview of Anguillas commercial laws

Overview of the financial sector and relevant professions

Other relevant factors for exchange of information

COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION 15

Compliance with the Standards

16 COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION

A.1. Ownership and identity information

Companies (ToR A.1.1) Types of Companies

COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION 17

International Business Company

18 COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION

Limited Liability Company

COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION 19

20 COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION

Banks and Trust Companies

COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION 21

Insurance and Protected Cell Companies

22 COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION

COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION 23

24 COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION

Anti-Money Laundering laws

COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION 25

26 COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION

Bearer shares (ToR A.1.2)

COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION 27

Partnerships (ToR A.1.3)

28 COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION

Ownership and identity information provided to the government

COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION 29

Ownership and identity information held by the partnership

Trusts (ToR A.1.4)

30 COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION

COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION 31

32 COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION

Foundations (ToR A.1.5)

COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION 33

34 COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION

Other relevant entities and arrangements

Enforcement provisions to ensure availability of information (ToR A.1.6)

COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION 35

36 COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION

COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION 37

38 COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION

A.2. Accounting records

General requirements (ToR A.2.1)

Ordinary Companies and Protected Cell Companies

COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION 39

General and Limited Partnerships

40 COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION

COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION 41

Underlying documentation (ToR A.2.2)

Document retention (ToR A.2.3)

42 COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION

A.3. Banking information

Record-keeping requirements (ToR A.3.1)

COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION 43