The Isle of Man Financial Supervision Commission (the "FSC") is currently undertaking a consolidation and review of all of its financial services regulatory legislation with the aim of consolidating this into one statute (to be called the Financial Services Act) and one "rule-book" that will apply to all of the activities which the FSC is responsible for regulating. The one exception is in relation to collective investment schemes, which will be dealt with in a separate statute.
One of the principal reasons for the consolidation and review is that there are currently a number of Acts, regulations, codes and orders which have developed piecemeal over the years as the FSC has assumed responsibility for the regulation of different types of financial services. The proposed consolidation and review of the legislation will modernise the Island's regulatory framework and ensure that the Island's legislation is suitable to meet today's regulatory risks and continues to comply with international regulatory standards. The new legislation will also iron out inconsistencies across the different licensed sectors and streamline the legislation.
The result of the consolidation and review will be a simpler, clearer, more user-friendly and modern piece of legislation which should lead to a reduced regulatory burden, especially for those entities which undertake more than one regulated activity.
As part of the review process it is proposed that the regulation of money service businesses will be transferred from the Isle of Man Customs & Excise to the FSC. In addition, a new regulatory framework will be introduced to regulate e-money providers operating in or from the Isle of Man. It is proposed that the new regulations will impose capital requirements on e-money providers, ensure e-money providers have appropriate expertise, systems and controls in place, and require e-money providers to retain suitable records and make compliance returns to the FSC.
The Financial Services Bill is currently working its way through the Isle of Man legislative process and the FSC is now consulting extensively on the proposed Regulated Activities Order, Exemption Regulations and rulebook. It is anticipated that the new legislation will be introduced during the course of 2008.
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