Turks and Caicos: Offshore Business Sectors
There are 17 licensed companies offering professional trustee services making trusts one of the most active areas of the Turks and Caicos Islands offshore centre. Most functions relating to the licensing, review and regulation of trusts are carried out by the Superintendent of Trustees based at the Financial Services Commission.
The Trustees (Licensing) Ordinance 1992 provides for the licensing and regulation of trust companies and other professional trustees. The Trustees (Licensing) Regulations 1992 set out the form of the application for obtaining a trustee licence, the categories of trust licences, the details required in an application for a trustee licence, reporting requirements and the rules governing the conduct of licensed trustees. Licensed trustees are required to submit financial returns, appoint auditors and maintain professional indemnity insurance.
The Trust Ordinance (1990) defines a professional trustee as someone who receives remuneration for his services as a trustee, sets out the general requirements for licensing professional trustees, the powers and duties of the Superintendent of Trustees, and miscellaneous provisions regarding liability, confidentiality and the non- application of the Recording of Deeds Ordinance.
Licenses can be restricted or unrestricted:
- A restricted Trustee Licence is issued on the basis of an undertaking by the trustee that it will act as a professional trustee only in respect of a named trust or trusts. An annual fee of US$1,000 is payable for this licence. Restricted Trustee Licences are normally used in connection with family trusts.
- An unrestricted Trustee Licence is issued without any restriction on which trust or trusts the trustee can act for. An annual fee of US$3,750 is payable to the Financial Services Commission.An important requirement in the licensing process is the submission of a Business plan together with full financial disclosure and business references on both the principals and managers of the proposed licensee. The minimum capital requirement is US$250,000. Many professional firms consider a trustee licence to be an appropriate and cost effective alternative to a banking licence.
The Trustees Licensing Exemption Order 1992 exempts the following entities from licensing:
- A company which is the trustee of a single trust and the issued share capital of which company is entirely beneficially owned by one or more of the beneficiaries, the settlor or by a combination of the beneficiaries and settlor. Family trust companies sometimes fall under this category;
- A company which is the trustee of a single trust and which has its registered office in an approved jurisdiction;
- A company which acts as a bare trustee with no interest in or duty to the trust property except to convey it when directed by the beneficial owner.