PTC Establish

Nadia J Taylor
Associate
PRIVATE TRUST COMPANIES

Establishing a PTC and Acting as a Registered Representative
HOW IS A PTC ESTABLISHED?

A PTC can be either: an IBC; or a Domestic company
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INCORPORATING A NEW PTC

The name of a PTC cannot include words such as Trustee, Trust Company or Private Trust Company without the prior approval of Central Bank.
MEMORANDUM AND ARTICLES OF ASSOCIATION

1. 2. 3. 4. 5. Minimum Capital Requirement - $5,000. Specific objects and purposes. Designated Persons or Designated Person. Special Director. Registered Representative.
MEMORANDUM AND ARTICLES OF ASSOCIATION

Objects and Purposes of a PTC to act as trustee only for a trust created or to be created at the direction of a Designated Person or Designated Persons.
DESIGNATED PERSON OR PERSONS

A Designated Person(s) is an individual or individuals described as such within the Designating Instrument provided that if more than one each Designated Person must be related to the Designated Person so described by consanguinity or some other family relationship.
DESIGNATED PERSON OR PERSONS

A Designated Person may be deceased. The names of the Designated Person(s) will not be a part of the memorandum and articles of association.
SPECIAL DIRECTOR
A PTC must have one Special Director with: knowledge of trust administration; or five years experience in a discipline relevant to trust administration which includes one or more of law, finance, commerce, investment management or accountancy.
SPECIAL DIRECTOR EXCEPTION

A PTC is not required to have a Special Director if:
a licensee serves as a RR of the PTC.
WHAT IS A REGISTERED
REPRESENTATIVE (RR)
Must be either: A licensee of the Central Bank; or A Financial and Corporate Services Provider (duly licensed under the Financial and Corporate Services Provider Act, 2000). Restricted only to the business of a PTC.
FUNCTIONS OF A RR
A RR may provide the services of: Secretary; Director; or Bahamas Agent. Where a RR acts as a Bahamas Agent for a PTC, it must enter into a service agreement to provide administrative services to the company.
REGISTERED REPRESENTATIVE (RR)

A licensed FCSP wanting to act as a RR must: Apply to the Central Bank for written approval of the Governor to act as a RR; Engage in RR services through a subsidiary company (Regulations 6(1)).

The Governor of the Central Bank may approve or deny an FCSP seeking to be a RR based on: The fitness of the FCSP. The business record and relevant experience of the FCSP or its beneficial owners.

Whether it has sufficient human and physical resources to act as a RR. The best interest of the financial industry.

A RR must be resident in The Bahamas and maintain a minimum share capital of $50,000. The fee payable to the Public Treasury to act as a RR of a PTC is $2,500 annually.

A RR is the main point of contact for the Central Bank in relation to PTCs. A RR is required to verify the identities of : the settlor and any person providing the funds or assets which are subject to the trust;

The Designated Person;
The Protector of any trust in which the PTC is a trustee; Vested beneficiaries of any trust of which a PTC is a trustee.

RR must maintain the following books and records at its office in The Bahamas: Memorandum and Articles of Association; Designating Instrument; CV of Special Director;

Trust instruments for each trust; A list of all the PTCs of which a RR acts; The Form of Acknowledgement to be executed by the settlor of the trust (to be produced where possible).
DESIGNATING INSTRUMENT
[INSERT COMPANY NAME] I, [DIRECTOR], hereby confirm that in relation to [INSERT COMPANY NAME] a Company [incorporated/to be incorporated] under the laws of The Bahamas, the Designated Person or Designated Persons for the purposes of Section 2 of the Act shall be: [INSERT INDIVIDUAL (S) NAME (S)]. Signed: DIRECTOR Acknowledged by: [INSERT COMPANY NAME]
FORM OF ACKNOWLEDGEMENT TO BE EXECUTED BY SETTLOR OF TRUST

I, [INSERT SETTLORs NAME], hereby acknowledge that in relation to [INSERT COMPANY NAME] (the Company) a company [incorporated/to be incorporated] under the laws of The Bahamas: i. that the Companys directors are not required by law to possess or exhibit expertise in trust administration and, therefore, said directors may, in fact, not be possessed of or exhibit such skill,
ii. that Company is not required by law to provide any fidelity bond,
FORM OF ACKNOWLEDGEMENT TO BE EXECUTED BY SETTLOR OF TRUST

iii. that the capital of the Company is not required by law to exceed Five Thousand Dollars and may, therefore, be minimal; and iv. that Company is not required by law to perform an annual audit. Accordingly, accepting the foregoing and fully understanding the legal implications hereof, I hereby waive any and all rights of complaint in respect of these matters. Signed: Settlor Acknowledged by:
REQUIREMENT OF A LICENCE
BTCRA section 3(2): No trust company shall carry on trust business from within The Bahamas whether or not such business is carried on in The Bahamas unless it is in possession of a valid licence granted by the Governor authorising it to carry on such business.
QUALIFICATIONS OF EXEMPTION
A PTC is exempt from the requirements of section 3(2) of the BTCRA if:
The PTC complies with the definition of a private trust company under the BTCRA as amended; It has a single Designating Instrument; It does not solicit trust business
Upon appointment as a RR of a PTC, a RR has a duty to certify to the Governor of the Central Bank that the PTC meets the requirement for exemption from section 3(2) of the BTCRA either:
Within six (6) months of the date of coming into force of the Regulations; or If a PTC is either an IBC or Domestic Company incorporated after the date of coming into force of the Regulations, within three 3 months of its incorporation.
HOW DOES A RR CERTIFY EXEMPTION?

A RR certifies exemption by obtaining from the directors of each PTC for which it provides services a duly completed Compliance Certificate in the form set out in the Fourth Schedule to the Regulations.
HOW DOES A RR CERTIFY EXEMPTION?

The Certificate should be accompanied by a briefing sheet on each PTC containing the name of the settlor and a list of trusts to be administered by the PTC. A RR must obtain a duly completed Compliance Certificate on, or before 31st December of each year.
COMPLIANCE CERTIFICATE
We, the undersigned directors (the Directors) of [COMPANY NAME], a Private Trust Company established under the laws of the Commonwealth of The Bahamas pursuant to the Banks and Trust Companies Regulation Act, 2000 (the Company) hereby declare that between [DATE] and [DATE]: 1. The Company has served only as trustee for trust or trusts for Designated Person or Designated Persons or an individual or individuals who are related by consanguinity or other family relationships to the Designated Person or Designated Persons and has not carried on any business or activity which was prohibited; and
COMPLIANCE CERTIFICATE
2. The Directors have acted honestly and in good faith with a view to the best interest of the Company. And we each make this solemn declaration conscientiously believing it to be true. ________________ __________________ Director Director
APPLICABLE FEES & COSTS

Establishment and Maintenance of the PTC
Fees due on commencement Annual Fee Registered Office/ Agent $5,000 $5,000 $? (discretionary)
Establishment of a RR
Application to act as RR Annual fee. $2,500 $2,500
APPLICABLE FEES & COSTS

Provision of RR services
Fees for acting as: (i) secretary; (ii) director; or (iii)Bahamas Agent. Fees for: (i) drafting a trust deed; and (ii) establishing a trust.
$? (discretionary)
Establishment of Trusts
$? $? (discretionary)
OTHER WAYS OF ESTABLISHING A PTC

Converting an existing IBC or Domestic Company into a PTC. Converting a restricted Company into a PTC. licence Trust
Converting an existing Foreign Company into a PTC.
QUESTIONS?
Nadia J Taylor
Associate
ntaylor@higgsjohnson.com

PTC Establish

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PTC Establish

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Nadia J Taylor

PRIVATE TRUST COMPANIES

HOW IS A PTC ESTABLISHED?

INCORPORATING A NEW PTC

MEMORANDUM AND ARTICLES OF ASSOCIATION

MEMORANDUM AND ARTICLES OF ASSOCIATION

DESIGNATED PERSON OR PERSONS

DESIGNATED PERSON OR PERSONS

SPECIAL DIRECTOR EXCEPTION

REGISTERED REPRESENTATIVE (RR)

REGISTERED REPRESENTATIVE (RR)

REGISTERED REPRESENTATIVE (RR)

REGISTERED REPRESENTATIVE (RR)

REGISTERED REPRESENTATIVE (RR)

REGISTERED REPRESENTATIVE (RR)

REGISTERED REPRESENTATIVE (RR)

REGISTERED REPRESENTATIVE (RR)

FORM OF ACKNOWLEDGEMENT TO BE EXECUTED BY SETTLOR OF TRUST

FORM OF ACKNOWLEDGEMENT TO BE EXECUTED BY SETTLOR OF TRUST

HOW DOES A RR CERTIFY EXEMPTION?

HOW DOES A RR CERTIFY EXEMPTION?

APPLICABLE FEES & COSTS

APPLICABLE FEES & COSTS

OTHER WAYS OF ESTABLISHING A PTC

Converting an existing Foreign Company into a PTC.

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