Gibraltar Financial Services Commission Presents Its Annual Report

Gibraltar Financial Services Commission Presents Its Annual Report

13 August 2012

The Financial Services Commission of Gibraltar (FSC) has released its 2012 annual report. It has reiterated its commitment to cost-effective financial regulation and to matching UK standards.

The FSC has highlighted the need to keep up with developments at EU level in matters of financial regulation, especially regarding systemic risk, consumer protection and financial crime, while maintaining a solid reputation as a reliable offshore financial centre (OFC). The FSC has emphasised the need to comply with the Solvency II and the Alternative Investment Fund Management Directives.

Following the 2008 financial crisis, Gibraltar has undertaken further regulation of its offshore financial services with a view to mitigating systemic risk while maintaining a competitive offshore industry. However, the FSC outlines in its 2012 annual report that there have been “backlogs” in the effective implementation of financial regulation.

More precisely, the FSC cites delays in the enactment of financial services legislation, and difficulties in the implementation of key EU directives, resulting from poor drafting in Gibraltar.

The FSC has also mentioned it is actively lobbying the government to scrap the current two tier system applicable to pension funds, as under current law only pension funds with more than 100 members are regulated, leaving members of smaller pension funds at risk. The Financial Services Commission has also said it would work for effective regulatory supervision on professions that currently fall outside of its scope, including especially legal services. According to the FSC, this lacuna poses a serious risk to the reputation of Gibraltar.

Among its other ambitions for 2012-2013 in order to mitigate systemic risk, the FSC has announced it is now considering a proposal for a law relating to the collapse of an insurance company, while deploring there is no legislation in Gibraltar in this area. Furthermore, the FSC has said it is actively monitoring EU proposals for bank recovery and resolution.

In the FSC’s opinion, effective financial regulation is key to secure the long-term competitiveness of the Gibraltar offshore industry.



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Gibraltar Financial Services Commission Presents Its Annual Report

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