The Caribbean Association of Banks expresses concern over EU’s “Blacklist”

The Caribbean Association of Banks Inc. (CAB) is deeply concerned about the recent inclusion of Caribbean territories on the European Union Commission’s (EU) list of non-cooperative jurisdictions for tax purposes. The list names countries which have not displayed sufficient commitment to the tax standards identified by the EU.

Blacklisting has debilitating effects on our Caribbean economies, specifically:

· It exacerbates the perception of our Region as ‘High Risk’ and consequently, negatively affects
the risk profile of regional financial institutions and the willingness of correspondent banks to
do business with them;
· It severely reduces critically-needed development funding from the EU and limits the ability of
Caribbean territories to pursue their development goals; and
· It makes the region vulnerable to future sanctions and financial penalties, which may be levied
against “blacklisted” jurisdictions.

Removal from the blacklist requires a high-level political commitment from the affected jurisdictions to address the deficiencies identified by the EU’s Code of Conduct Group. The status of Caribbean Territories as at 13th March, 2018 by the OECD are as follows:

Annex I (Blacklist): The Bahamas, Saint Kitts and Nevis and Trinidad and Tobago .
Annex II (Grey List): Anguilla, Antigua and Barbuda, Barbados, Belize, Bermuda, British Virgin Islands, Cayman, Curacao, Dominica , Grenada, Jamaica, St. Lucia and
St. Vincent and the Grenadines.

The EU has given the above countries specific time-frames to make high level commitments to address the deficiencies identified by the Code of Conduct group. Some of the deficiencies identified in the various Caribbean jurisdictions are:

· Existence of Harmful and Preferential Tax Regimes;
· Non application of Base Erosion and Profit Sharing (BEPS) minimum standards (tax avoidance
strategies which seek to artificially shift profits to low/no tax jurisdictions); and
· Non commitment to signing and ratifying the Convention of Mutual Administrative Assistance
(Tax information exchange agreements to fight international tax evasion).

The CAB recognizes the efforts of regional governments thus far towards compliance with the OECD Global Forum on Transparency and Exchange of Information for Tax Purposes Standards. Nonetheless, the very challenging issue of harmful and preferential tax regimes needs to be addressed.

Consequently, the CAB:

1. Calls upon all regional governments concerned, to carefully assess the deficiencies identified
by the EU and take the necessary actions to ensure compliance with Global Standards in order
to avoid further reputational risk/damage to the region.

2. Strongly recommends continued collaboration and coordination among CARICOM

Governments so as to take appropriate measures on key issues which can impact the financial services sector as well as the growth and development of regional economies.

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1 Comment

  1. Anonymous
    March 22, 2018

    You can not have your cake and eat it and the banks affected should ask the governments in who’s jurisdictions they operate to comply with the E.U. requests. You can not keep asking the EU for aid and assistance and then tell them to mind their own business when they question how you handle your money. Imagine you have a child you constantly have to bail out and tells you it is none of your business how he or she spend their money. Would you blame parents for withholding their largesse in such circumstances? And don’t forget it are not only those governments who will suffer the consequences but the ordinary man and woman in the street that does not have a secret off-shore account.

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