SIFA earns the big ticks
Established in 1988 the Samoa International Finance Authority (previously known as Samoa Offshore Centre) is a statutory corporation engaged in rendering a range of financial services to offshore entities in accordance with international guidelines. <!--more-->These include licensing of offshore banks and insurance companies as well as registering entities such as companies – and now trusts, following the recently legislated Trusts Act in April.
The Authority, governed by a reconstituted board of seven directors, performs a regulatory and supervisory function while promoting financial facilities in exploring ways to attract business to Samoa as an efficiently working international finance centre conforming to stringent international norms and standards. It’s facility to register companies with memoranda in Mandarin makes it popular with Asian business houses, particularly from Hong Kong, Singapore and China.
SIFA has had its fair share of problems. It was “grey listed” in 2009 and needed to adhere to new standards set by organisations like the OECD (Organisation for Economic Co-operation and Development) and Asia Pacific Group on Money Laundering.
“It took eight months to come back on the white list after having signed 12 tax information exchange agreements. Each country had a separate one including 7 Nordic states,” says Chief Executive Erna Vaai, who has been in the role since 1992. That number now stands at 15. Samoa was the first in the Pacific Island jurisdiction to comply with the new standards in December 2009 joining the UK, USA, Australia and New Zealand among other jurisdictions on the OECD White List.
“With the new standards, SIFA has had a relook at core strengths, embraced innovations and looked at new ways of doing things,” Ms Vaai says. “Compliance is now of an international standard with commercial realities balanced. Credibility of the jurisdiction has been established.” New standards take on board not only issues of money laundering but also the financing of terrorist organisations, those relating to suspect electronic transactions and proceeds of crime, among others.
SIFA has some 34,000 entities registered with it. Nearly 4000 are added each year translating into a 10 per cent growth (there is a reasonable rate of attrition, too). Asia is obviously a major source of business. “Memoranda in Mandarin, Samoa’s embassy in Beijing and the Manu Samoa Sevens roadshows have all helped increase SIFA’s popularity in the Chinese market,” Ms Vaai says.
Samoa’s Offshore Trusts Act passed in April this year permits the registration of offshore trusts. The laws apply to local trusts as well. SIFA has hired a Hong Kong law firm to provide local training to administrators and accountants. Offering wealth management solutions is also on the cards, Ms Vaai said.