FINANCIAL SERVICES AUTHORITY ACT, 2013

Arrangement of Sections

PART I

PRELIMINARY

1. Short title.

2. Interpretation.

PART II

THE FINANCIAL SERVICES AUTHORITY

3. Establishment of the Authority.

4. Functions of the Authority.

5. Establishment and membership of the Board.

6. Functions of Board.

7. Meetings of the Board of the Authority.

8. Terms and conditions of office.

9. Appointment and functions of the Chief Executive.

10. Appointment of other staff.

11. General powers of Authority.

PART III

FINANCIAL AND REPORTING PROVISIONS APPLICABLE TO THE AUTHORITY

12. Funds and resources of Authority.

13. Accounts and audit.

14. Annual Report.

PART IV

INFORMATION GATHERING AND DISCLOSURE PROVISIONS

15. General power to request information.

16. Power of Authority to request specified information or documents.

17. Duty to cooperate.

18. Provision of assistance to foreign regulatory authorities.

19. Recovery of costs.

20. Protection for disclosure.

21. Restrictions on disclosure of information.

22. Guidelines for disclosure of information.

PART V

COMPLIANCE AND ENFORCEMENT

23. Compliance function.

24. Compliance inspection.

25. Appointment of examiners.

26. Directives.

27. Enforcement action.

28. Public statements.

29. Revocation or suspension of licence.

30. Surrender of licence.

31. Application for a protection order.

32. Powers to issue directions.

PART VI

GENERAL SUPERVISORY POWERS

33. Power to issue codes and guidelines.

34. Conditions.

35. Exemptions.

36. Approved forms.

PART VII

ADMINISTRATIVE AND MISCELLANEOUS PROVISIONS

37. Duty of a Member to disclose interest.

38. Duty to take oath.

39. Immunity.

40. Right to constitute Committees.

41. Right of appeal.

42. Appeal board.

43. Offences and penalties.

44. Power to compound an offence.

45. Transitional provisions.

46. Repeal and savings.

47. Consequential amendments.

48. Regulations.

SCHEDULE 1

SCHEDULE 2

SCHEDULE 3

SCHEDULE 4

19 of 2013.

SI 14 of 2014.

AN ACT to establish a Financial Services Authority to licence, regulate and develop the financial services industry in Seychelles, to confer certain statutory powers and functions on the Authority and to provide for other matters connected therewith.

[Date of commencement: 1st March 2014]

PART I

PRELIMINARY

1. Short title.

This Act may be cited as the Financial Services Authority Act, 2013.

2. Interpretation.

In this Act—

"Appeals Board" shall mean the board as established under section 42;

"Board" means the Board of the Authority established under section 5;

"Chairperson" means the Chairperson of the Board appointed by the President under section 5;

"Authority" means the Financial Services Authority established under section 3;

"Court" means the Supreme Court of Seychelles;

"document" means a document in any form and includes—

(a) any writing or printing on any material;

(b) any record of information or data, however compiled, and whether stored in paper, electronic, magnetic or any non-paper based form and any storage medium, including discs and tapes;

(c) books and drawings; and

(d) a photograph, film, tape, negative or other medium in which one or more visual images are embodied so as to be capable (with or without the aid of equipment) of being reproduced,

without limiting the generality of the foregoing, includes any Court application, order and other legal process and any notice;

"financial crime" means money laundering, financing of terrorism, offences relating to misconduct in, or misuse of information relating to, financial markets and offences involving fraud or dishonesty;

"financial services business" means a business activity—

(a) for which a licence is required under any regulatory legislation set out in Part 1 of the First Schedule; or

(b) prescribed by the regulations as financial services business;

"financial services legislation" means any legislation set out in Schedule 1;

"foreign regulatory authority" means an authority in a jurisdiction outside Seychelles which exercises a function corresponding or similar to a function exercisable by the Authority under this Act;

"licence" means an authorisation or licence issued or granted under any regulatory legislation;

"licencee" means a person holding a licence under any Financial Services Legislation;

"Member" means a member of the Board;

"Minister" means the Minister responsible for Finance;

"registry legislation" means any financial services legislation set out in Part 2 of Schedule 1;

"regulated person" means a person authorised, licenced or registered or required to be so authorised, licenced or registered under any financial services legislation;

"regulations" means regulations made under section 48;

"regulatory legislation" means any financial services legislation set out in Part 1 of Schedule 1;

"unauthorised financial services business" means any financial services business carried on by a person without a valid licence.

PART II

THE FINANCIAL SERVICES AUTHORITY

3. Establishment of the Authority.

(1) There shall be established an Authority to be known as the "Financial Services Authority".

(2) The Authority shall be a body corporate with perpetual succession and a common seal, capable of suing and being sued in its corporate name and may hold or dispose of property, enter into contracts and perform such acts as a body corporate may legally perform.

(3) Schedule 2 has effect with respect to the administration of the Authority.

(4) The Authority shall, in discharging its functions, act independently and no person shall seek improperly to influence a member of the Board or any of the employees of the Authority, in the discharge of his or her functions or interfere in the activities of the Authority.

(5) A member of the Board, or employee of the Authority shall not be unduly influenced in the discharge of his or her functions or seek or take instructions from any person other than the Authority.

4. Functions of the Authority.

(1) The functions of the Authority are—

(a) to supervise and regulate licencees in accordance with this Act and the financial services legislation;

(b) to monitor and regulate, in accordance with relevant financial services legislation, financial services business carried on in or from within Seychelles;

(c) to take such measures as it considers appropriate to develop the financial services industry in Seychelles, including the conduct of surveys relating to the industry in Seychelles;

(d) to receive, review and determine applications for licences;

(e) to monitor compliance by licencees, and by such other persons who are subject to the regulatory legislation;

(f) to administer the registry legislation;

(g) to monitor the effectiveness of the financial services legislation in providing for the regulation of financial services business in Seychelles to internationally accepted standards;

(h) to make recommendations to the Minister on such amendments or revisions to the financial services legislation or such new legislation as the Authority considers necessary or appropriate in developing the financial services industry in Seychelles;

(i) to develop appropriate legal, regulatory and supervisory mechanisms for the efficient and effective administration of the Authority and the financial services legislation;

(j) to maintain contact and develop relations with persons engaged in financial services business in Seychelles with a view of conducting market research and encouraging the development of high professional standards within the financial services industry;

(k) to develop, with such persons as the Authority may determine for purposes of maintaining integrity and professionalism in the Seychelles financial services industry, a system of continuing education for practitioners in financial services business and towards this end to develop such curriculum as it considers appropriate;

(l) to adopt such measures as may be necessary to appropriately inform and educate the general public on its functions and on matters relating to or affecting any financial services business;

(m) to issue such advisories to investors, licencees and the general public as it considers appropriate;

(n) to monitor, in the public interest, promotional advertisements relating to any financial services business or to services provided under, or with respect to, any financial services legislation and give such advice relating to accuracy, fairness and compliance with established laws and policies;

(o) to enter into memoranda of understanding with regulatory and law enforcement agencies within and outside Seychelles;

(p) to take action against persons carrying on unauthorised financial services business in Seychelles; and

(q) to perform such other functions as may be assigned to it under this Act or under any other enactment.

(2) In performing its functions, the Authority may take into account any matter which it considers appropriate including international initiatives geared towards establishing legal, business and regulatory standards relating to financial services business or to other businesses or activities subject to the financial services legislation and, in particular, have regard to—

(a) the protection of the public, whether within or outside Seychelles, against financial loss arising out of the dishonesty, incompetence, malpractice or insolvency of persons engaged in financial services business in or from within Seychelles;

(b) the protection and enhancement of the reputation of Seychelles as a financial services centre; and

(c) the reduction of crime and other unlawful activities relating to financial services business.

(3) For the purposes of subsection (2)(a), ''the public" includes investors, clients and potential clients of persons engaged in financial services business in Seychelles.

(4) The Authority shall not be liable for any loss or injury arising from the performance of its functions pursuant to subsection (1) or (2).

5. Establishment and membership of the Board.

(1) There shall be a Board of the Authority consisting of—

(a) the Chairperson, who shall be appointed by the President;

(b) the Chief Executive Officer, who shall be appointed by the President under section 9;

(c) the Principal Secretary of the Ministry responsible for Finance or a representative of the Principal Secretary;

(d) the Attorney-General or a representative of the Attorney-General who shall be an ex-officio member of the Board;

(e) the Chairperson of the Seychelles Chamber of Commerce and Industry or a representative of the Chairperson;

(f) the Chairperson of the Seychelles Bankers' Association or a representative of the Chairperson;

(g) the Governor of the Central Bank of Seychelles or a representative of the Governor;

(h) the Chief Executive Officer of the Seychelles Investment Bureau or a representative of the Chief Executive Officer; and

(i) two other persons who shall be appointed by the President.

(2) A previous appointment as a Member does not affect a persons' eligibility for further appointment under this section.

(3) The Board may appoint an employee of the Authority, other than a Member, to act as Secretary to the Board with such duties as the Board may determine.

6. Functions of Board.

(1) The Board is the governing body of the Authority and shall be responsible for—

(a) establishing the policy of the Authority and monitoring and overseeing its implementation;

(b) monitoring and overseeing the management of the Authority by the Chief Executive Officer with the objective of ensuring that—

(i) the resources of the Authority are utilised economically and efficiently;

(ii) the internal management and financial controls of the Authority are adequate;

(iii) the Authority operates in accordance with the principles of good governance;

(iv) the Authority fulfils its statutory obligations and properly discharges its functions;

(c) approving the Authority's accounts under section 13.

(2) In the performance of its functions, the Board may—

(a) establish such committees as it considers appropriate on such terms and conditions as it may determine; and

(b) delegate such duties as it considers necessary to the Chief Executive Officer.

7. Meetings of the Board of the Authority.

(1) The Board shall meet at least once every three months at such place and time as may be designated by the Chairperson.

(2) At every meeting of the Board, the Chairperson shall preside.

(3) In the absence of the Chairperson at a meeting of the Board, the members present shall elect a member to act as Chairperson for that meeting.

(4) The quorum of the Board shall be 6.

(5) At any meeting for the conduct of its business, the Board shall take its decision by a majority vote of the Members present and in the event of a tie the Chairperson shall have a casting vote.

(6) The Chairperson shall at any time convene a special meeting of the Board upon receipt of a requisition signed by at least four Members calling upon him or her to do so, and such meeting shall be held not later than twenty-one days after receipt of the requisition.

(7) No act or proceedings of the Board shall be invalid by reason of any vacancy among its Members or of any defect in the appointment of a Member.

(8) Notwithstanding anything contained in this section, the Chairman may, in any matter he or she considers exceptional, make arrangements for a decision of the Board to be taken on such matter through a process of consultation without the need for an actual meeting.

(9) Subject to the provisions of this section, the Board shall frame its own rules of procedure, for the conduct of its meetings.

8. Terms and conditions of office.

The appointment of a Member under section 5(1), (a) or (b) or (i) shall be on such terms as may be determined by the President.

9. Appointment and functions of the Chief Executive.

(1) The President shall appoint a person to be the Chief Executive Officer of the Authority on such terms and conditions as the President considers appropriate.

(2) The Chief Executive Officer is an employee of the Authority and shall—

(a) be responsible for the administration and operation of the Authority and supervision of staff of the Authority;

(b) subject to any general or special direction of the Board, execute the functions of the Authority outlined in section 4;

(c) be responsible for identifying and classifying staff positions in the Authority;

(d) coordinate and execute as required by any financial services legislation all requests for legal and regulatory assistance from foreign regulatory authorities; and

(e) perform such other duties as may be assigned or delegated to him by the Board.

(3) In discharging his functions, the Chief Executive Officer shall use his or her best endeavours to ensure that—

(a) the resources of the Authority are utilised economically and efficiently;

(b) the internal financial and management controls of the Authority are in line with international best practices;

(c) the Authority operates in accordance with the principles of good governance; and

(d) the Authority fulfils its statutory obligations and properly discharges its functions.

(4) The President may appoint a Deputy Chief Executive Officer who shall assist the Chief Executive Officer in performing duties as may be assigned by the Chief Executive Officer.

10. Appointment of other staff.

Without prejudice to the powers under section 9(2)(c), the Authority may appoint such officers, employees and agents as it considers necessary and proper for the administration, management and performance by the Authority of its functions under this Act.

11. General powers of Authority.

Subject to this Act and any other law, the Authority may do all things necessary for, or reasonably ancillary or incidental to, the carrying out of its duties, functions or powers under this Act or any financial services legislation, including—

(a) the engagement of advisors and consultants as the Authority considers necessary on such terms and conditions as it deems fit;

(b) upon consultation with the Minister the opening and maintenance of accounts with banks for the purposes of the Authority, within or outside Seychelles;

(c) upon consultation with the Minister, loans for the financing of its operations; and

(d) investing its funds, that are not immediately required for the discharge of its functions, in such manner as it considers prudent.

PART III

FINANCIAL AND REPORTING PROVISIONS APPLICABLE TO THE AUTHORITY

12. Funds and resources of Authority.

(1) The funds and resources of the Authority shall comprise—

(a) fees, charges and penalties (excluding penalties imposed by a court) payable under this Act and other regulatory legislation set out in part 1 of the First Schedule;

(b) such monies as may be appropriated by the National Assembly pursuant to an Appropriation Act for the purposes of the Authority and paid to the Authority;

(c) monies paid and property provided to the Authority by way of grants, fees, charges, rent, interest and other income derived from the investment of the Authority's fund;

(d) monies derived from the disposal of or dealing with property held by the Authority;

(e) monies borrowed by the Authority in accordance with this Act; and

(f) any property lawfully received by or vested in the Authority.

(2) The funds and resources of the Authority may be applied by the Authority—

(a) in the payment or discharge of its debts, expenses and other obligations;

(b) in the payment of emoluments, fees and allowances payable to the Members and the secretary of the Board and the employees of the Authority; and

(c) any contingencies relevant to the furtherance of the functions, duties and powers of the Commission.

(3) The Authority shall, after making adequate provisions at the end of each quarter of its financial year for—

(a) the applications of its funds and resources under subsection (2) above;

(b) the acquisition, replacement and depreciation of its assets;

(c) the repayment of loans and advances and interest and charges thereon; and

(d) other payments which the Board deems necessary or desirable for the effective performance of the Authority's functions and discharge of duties;

payout any excess income to the Government's Consolidated Fund.

(4) Notwithstanding the provisions made under subsection 3 above, adequate provisions shall be made to ensure that any payment of excess income under the subsection (3) to the Government's Consolidated Fund shall not cause the Commission not to be in a financial position to carry out its duties, functions or powers properly for that financial year or the financial year next ensuing.

(5) The financial year of the Authority shall be for period 1st January to 31st December in each year.

13. Accounts and audit.

(1) The Authority shall—

(a) keep proper books of accounts of its income and other receipts and expenditure; and

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