Professional Documents
Culture Documents
JAMAICA
Global Forum
on Transparency
and Exchange
of Information for Tax
Purposes Peer Reviews:
Jamaica 2010
PHASE 1
September 2010
(reflecting the legal and regulatory framework
as at May 2010)
This work is published on the responsibility of the Secretary-General of the OECD.
The opinions expressed and arguments employed herein do not necessarily reflect
the official views of the OECD or of the governments of its member countries or
those of the Global Forum on Transparency and Exchange of Information for Tax
Purposes.
Series: Global Forum on Transparency and Exchange of Information for Tax Purposes: Peer Reviews
ISSN 2219-4681 (print)
ISSN 2219-469X (online)
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TABLE OF CONTENTS – 3
Table of Contents
Introduction....................................................................................................................... 11
Information and methodology used for the peer review of Jamaica ............................... 11
Overview of Jamaica ....................................................................................................... 12
General information on legal system and the taxation system ........................................ 12
Overview of commercial laws and other relevant factors for exchange of
information ...................................................................................................................... 16
Recent developments ...................................................................................................... 17
Compliance with the Standards ....................................................................................... 19
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4 – TABLE OF CONTENTS
Annex 1: Jurisdiction’s Response to the Review Report ............................................... 83
Annex 3: List of all Laws, Regulations and Other Material Received ......................... 87
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ABOUT THE GLOBAL FORUM – 5
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EXECUTIVE SUMMARY – 7
Executive Summary
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8 – EXECUTIVE SUMMARY
compulsorily required to maintain accounting records for tax purposes.
Although administrative laws require government authorities to hold
the records submitted to them and the statute of limitations means all
records are kept for more than 5 years, there is not a specific
requirement in the law for non-regulated entities to maintain that
information for a five year period. This does not include financial
institutions and other businesses and professions covered by the anti-
money laundering laws and those laws require a compulsory five year
retention period for records relating to customer due diligence and
financial transactions.
6. Jamaica has two sources of law allowing its revenue authority
to access information. One suffers from the fact that it cannot be used
to obtain information from financial institutions and similar entities,
and the other law which is used for requests to financial institutions is
restricted by the requirement that the person in question be under
examination by the Jamaican tax authorities. Latter tantamount to a
domestic tax interest, which is an obstacle to the effective exchange of
information. The report recommends that Jamaica issue and adopt
regulations whereby the ability to apply administrative procedures to
obtain the information does not require the taxpayer to be under
examination or persons to be taxpayers in Jamaica.
7. Sanctioning powers are in place to secure the compliance of
the provisions. The effectiveness of penalties will be examined in the
course of the Phase 2 review.
8. Jamaica has tax treaties with most of its large economic
partners. The treaty with Switzerland does not have an EOI Article.
Only one of its bilateral treaties and its only TIEA provide for exchange
of information in accordance with the standard. Jamaica is also a
signatory to the multilateral CARICOM1 Income Tax Treaty which
includes 10 other countries2 and, because of restrictions in Jamaica’s
and some of its partners’ domestic systems with respect to availability
and access to information, this too does not meet the international
standard. It is recommended that Jamaica pursue its policy to conclude
agreements to the standard.
9. Jamaica has a system which provides for international
exchange of information for tax purposes but this system does not have
1
Caribbean Community.
2
Antigua and Barbuda, Barbados, Belize, Dominica, Grenada, Guyana, St. Kitts
and Nevis, Saint Lucia, St. Vincent and the Grenadines, and Trinidad and
Tobago.
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EXECUTIVE SUMMARY – 9
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INTRODUCTION – 11
Introduction
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12 – INTRODUCTION
Overview of Jamaica
Legal system
15. The Head of State is the British Monarch represented by the
Governor General in Jamaica. Jamaica is a parliamentary democracy,
modelled on the Westminster system. The Parliament comprises the
monarch, the Senate and the House of Representatives. The Senate
comprises 21 members appointed by the Governor General; 13
appointed in accordance with the advice of the Prime Minister and 8 in
5
http://statinja.gov.jm/population.aspx, accessed 13 May 2010.
6
http://www.mfaft.gov.jm/?q=caribbean-community-caricom.
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INTRODUCTION – 13
accordance with the advice of the Leader of the Opposition. The House
of Representatives consists of 60 members elected under universal adult
suffrage. The executive power of the government resides in the council
of ministers (cabinet), which is led by the Prime Minister. The Prime
Minister is the leader of the majority party or the leader of the majority
coalition in the House of Representatives. Constitutionally, elections
must be held every five years, but they may be called at any time by the
Prime Minister.
16. The legal system of Jamaica is based on English common
law. Justice is administered by the court system7 consisting of the Court
of Appeal, Supreme Court, Resident Magistrate’s Court and Court of
Petty Sessions. The Supreme Court has original jurisdiction and decides
applications for redress of breaches of fundamental rights and freedom
provisions of the Constitution. Within the Supreme Court, there are
specialised courts such as the Revenue Court, established in 1971, and
the Commercial Court, which began operations in February 2001. The
hierarchy of laws in Jamaica is constituted by: (i) the Constitution of
Jamaica; (ii) statutes and treaties; and (iii) common law and customs.
17. Taxpayers aggrieved by decisions of the tax administration
can seek judicial review through civil proceedings in the Supreme
Court. Either party can contest a decision of the Supreme Court in the
Court of Appeal and the matter could finally go to the Judicial
Committee of the Privy Council.
18. For transposing the tax treaties into domestic law, the
Minister of Finance and Public Service makes a Cabinet Submission for
Cabinet Approval. The approval is the ratification process. Thereafter,
the treaty is incorporated into Jamaican laws where the Minister of
Finance makes an Order pursuant to s.83 of the Income Tax Act 1955
(ITA). The Order (which includes the actual treaty) is published by way
of a Notice in the Gazette which introduces the treaty into Jamaican
Law.
Taxation System
19. All taxes on income are levied by the central government.
Certain taxes on real property and licence fees are levied by local
government. Jamaica levies tax on income of every person and the basis
of imposition of income tax is provided in s.5 of the ITA. The ‘person’
means any individual and also any body of persons, which include
corporate. The “body corporate subject to income tax” means any body
7
http://www.moj.gov.jm/courts.
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14 – INTRODUCTION
corporate, wherever resident, other than one whose entire income is by
s.12 of the ITA or any other enactment exempted or relieved from
income tax.
20. Every person liable to pay income tax is required to deliver a
true and correct return of his whole income in the prescribed form (ITA,
s.67). Persons committing defaults in filing returns of income or
making false claims are subject to penalties (including fines) and are
liable to prosecution under the ITA. In Jamaica the tax year coincides
with the calendar year, however the accounting year (i.e. fiscal year)
starts on 1 April and ends on 31 March.
21. Income tax is charged on the worldwide income of resident
individuals in Jamaica and the income of non-residents derived from
Jamaica. There is no income tax on capital gains earned on the disposal
of capital assets. However, there is a transfer tax of 4% of gross
consideration or market value when title passes. Resident individuals
which are considered non- “domiciled” in Jamaica, as approved by the
Commissioner, or are Commonwealth citizens who are resident but not
ordinarily resident in Jamaica are in principle taxable on foreign income
only on a remittance basis (to the extent that such income is received in
Jamaica (s.27 ITA)). The test of residency in Jamaica is determined by
whether the resident is ordinarily resident or domiciled in Jamaica. An
individual is considered resident in Jamaica, if the stay in the island is
more than183 days. The rate of tax for individual is fixed at 25%,
however due to revenue enhancing measures, a progressive rate
structure (starting at 25% and going up to a maximum of 35%) has been
prescribed, which is scheduled to come to an end in December 2010.
22. Jamaican resident companies are liable to income tax on all
sources of non-exempt income wherever arising. A company is
regarded as resident in Jamaica if its central management and control is
located and exercised in Jamaica. A non-resident company is taxed on
income of a branch carrying on a trade or business in Jamaica, i.e. the
income arising in Jamaica. The rate of tax on companies is 33.3%.
23. Partnerships and joint ventures are not regarded as separate
persons for income tax purposes and are fiscally transparent entities.
Their members or participants are chargeable in their own right and in
accordance with their residence status on their share of profits as if they
had derived the profits directly. These entities are required to file tax
returns.
24. Trusts and estates are regarded as separate entities for tax
purposes and any income accruing to the trust or estate is taxable. The
trustees or personal representatives of the deceased are responsible for
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INTRODUCTION – 15
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16 – INTRODUCTION
28. The Jamaican Export Free Zones (EFZ) is a government
initiative to encourage foreign investment. Businesses operating within
these zones have no tax on their profits, duty exemption on imports and
exports, and relaxed customs procedures. However, they must export
85% of their produce outside of CARICOM. Created under the Jamaica
Export Free Zones Act (EFZ) 1982, the zones are operated by the
government. Benefits under the EFZ are granted only to companies
incorporated or registered in Jamaica under the Companies Act. In
addition, all transactions must be conducted in US currency. Jamaica
has five free trade zones but companies outside of the zones can apply
for Free Zone status as Single Entity Free Zones. The first free zone,
Kingston Free Zone (KFZ), was created in 1976. The other major free
zones are Montego Bay Free Zone (MBFZ), Garmex Free Zone, Hayes
Free Zone, and Cazoumar Free Zone.
29. The International Finance Companies (Income Tax Relief)
Act 1971 as amended provides the establishment of international
finance companies whose income from prescribed financial operations
is subject to reduced income taxation at the rate of 2.5%. A company
incorporated in Jamaica or outside Jamaica qualifies to be an
international finance company (IFC), if at least 95% of the issued share
capital and voting power is held by non-residents. The dividends paid
by an IFC to a non-resident are subject to withholding tax at a reduced
rate of 2.5%. Payments to a non-resident of loan interest and royalties
related to the prescribed financial operations may be made without the
withholding of tax. Jamaica has stated that this law has been kept in
abeyance and no approvals are being given to companies. Jamaica has
recently deleted all information about IFCs from its websites.
8
Only 11 of these treaties have EOI provisions.
9
The 15 members of CARICOM are: Antigua and Barbuda, Bahamas, Barbados,
Belize, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Suriname, Saint
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INTRODUCTION – 17
Recent developments
Kitts and Nevis, Saint Lucia, Saint Vincent and the Grenadines, and Trinidad and
Tobago.
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A. Availability of Information
Overview
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company acts on behalf of another person as a nominee or under similar
arrangements, Beneficial ownership can nevertheless be investigated by
the companies themselves, by the Minister as well as by tax authorities.
38. Companies incorporated outside Jamaica (foreign companies)
are allowed to raise share capital and issue debentures in Jamaica.
However, it is not mandatory for them to keep a branch register of their
members who are resident in Jamaica. Foreign companies incorporated
outside Jamaica but having central management and control in Jamaica
are not required to provide the ownership information in Jamaica.
39. Jamaica has enforcement provisions in its law ensuring
availability of information required to be kept under the relevant laws.
40. Jamaican law does not clearly require keeping of the
underlying documents by all relevant entities.
41. Jamaica does not have provisions in the legislation requiring
retention of the accounting records by all the persons or by the
authorities. In absence of this requirement, the availability of records
for five years cannot be guaranteed.
Jurisdictions should ensure that ownership and identity information for all relevant
entities and arrangements is available to their competent authorities.
10
Terms of Reference to Monitor and Review Progress towards Transparency and
Exchange of Information.
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COMPLIANCE WITH THE STANDARDS: AVAILABILITY OF INFORMATION – 21
Types of Companies
43. The Companies Act s.3 provides for the incorporation of the
following type of companies:
• Company limited by shares – A company having the liability of its
members limited by the articles to the amount, if any, unpaid on the
shares respectively held by them;
• prohibits any invitation to the public to deposit money for fixed periods
or payable on call whether bearing or not bearing interest; and
• subject to the exceptions provided for, prohibits any person other than the
holder from having any interest in any of the company’s shares.
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reducing its authorised share capital and is registered under the
Securities Act as a mutual fund.
47. An association formed as a limited company for promoting
commerce, art, science, religion, charity or any other useful object and
intends to apply its profits, if any, other income in promoting its objects
and to prohibit the payments of any dividend to its members can be
allowed by the Minister to be registered as a company with limited
liability and such company is exempted from sending the list of
members to the Registrar.
48. In the case of a company limited by a guarantee and not
having a share capital, no person other than a member can have a right
to participate in the divisible profits of the company unless such
provision was in existence from the beginning (Companies Act s.20).
Registration of companies
49. There are currently 63 272 companies registered in Jamaica.
50. Provisions relating to registration of companies are contained
in s.11 to s.18 of the Companies Act. All companies incorporated in
Jamaica (including, for example mutual fund companies) are required
to register with the Registrar of Companies. Section 11 requires that the
articles shall be delivered to the Registrar who shall retain and register
them if the articles comply with the provisions of the Act. Section 13(2)
requires the production of a statutory compliance declaration by an
attorney-at-law engaged in the formation of the company, or by a
person named in the articles as a director or secretary of the company,
or by a person who is a member of the Institute of Chartered Secretaries
and Administrators engaged in the formation of the company certifying
the compliance with the requirements under the Companies Act. The
articles must be signed by each subscriber to the articles.
51. Companies Act s.9 requires that in the case of an unlimited
company or a company limited by guarantee the articles must state the
number of members with which the company proposes to be registered
and, if the company has the share capital, the amount of share capital
with which the company proposes to be registered. There is no
provision to provide names and addresses of the members, while
registering the company. An increase in the number of members
beyond the registered number by an unlimited company or a company
limited by guarantee requires to be notified to the Registrar of
Companies and he shall record the increase.
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case of private companies the legal owners would be the beneficial
owners of shares.
58. Part X of the Companies Act contains provisions relating to
companies incorporated outside the Island and carrying on business
within the Island. This may include companies not incorporated in
Jamaica but having its central management and control in Jamaica.
These companies are required, within one month of establishment of
the place of business, to deliver to the Registrar for registration a
certified copy of the charter, statutes or articles of the company, or
other instrument constituting or defining the constitution and containing
the name of the company, names and address of the directors or
shadow directors of the company and particulars as are required in the
register of directors of the company and the name and address of the
resident person for receiving the notice (s.363).The information on the
shareholders/owners of the parent company is however not required to
be provided.
59. Companies that have accounts with or carry out transactions
through banks and financial institutions are required to provide the
identity information to their bankers as per regulation 7 of the POCA
(MLP) Regulations 2007 and s.IV of the Bank of Jamaica (BOJ)
AML/CFT Guidance Notes. This information cannot be obtained
directly from the banks or financial institutions by the competent
authority for the purposes of exchanging information with foreign tax
authorities under EOI arrangements, because s.17G of the Revenue
Administration Act 1985 requires obtaining a production order from the
court.
60. All persons doing business in Jamaica are required to obtain a
Taxpayer Registration Number (TRN) from the TRN office in Kingston
(s.17D of Revenue Administration Act 1985).
61. Overseas companies are also required to obtain TRN by filing
the completed Application for “Taxpayer Registration (Organizations)”
signed by an Authorised Officer or the local representative. Documents
are required to be filed along with the application; however, no
information about owners is required to be filed.
62. Domestic and foreign companies are taxable entities in
Jamaica and are required to file annual tax returns. A body corporate
subject to income tax is defined in the ITA to mean any body corporate,
wherever resident, other than one whose entire income is by s.12 or any
other enactment exempted or relieved from income tax. Tax returns are
not required to contain any ownership information.
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67. For those share warrants to bearer which are still in existence,
the identity of owners of these warrants is not required to be provided
nor maintained by the company in the register of members. The
information regarding the ownership of this type of share warrant will
also not be available in the annual return. As a result, Jamaica does not
have mechanisms which allow the owners of share warrants to bearer to
be identified. As this system is now in abeyance, the assessment team is
of the opinion that this issue is of limited importance.
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Regulated entities
73. The BOJ licenses and registers merchant or commercial
banks, building societies, remittance companies and bureaux de change,
while the Financial Services Commission (FSC) supervises and
regulates the securities, insurance and private pensions industries. The
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applicants desirous of carrying out the regulated activities are required
to provide the necessary information for registration in the desired field
of activities. A company11 is required to submit the listing of directors
and their addresses, certificate of incorporation, list of shareholders and
their shareholding, audited financial statements, tax compliance
certificate and names and addresses of all persons beneficially owning
10% or more in aggregate of the outstanding stock. Therefore, the
ownership information with regard to the entities operating in the
regulated fields would be available with the regulator.
74. The Proceeds of Crime (Money Laundering Prevention)
Regulations of 2007 and related regulations provide for customer due
diligence measures and further provide for verification procedures to be
applied. The Revised 2007 BOJ Guidance notes (Guidance Note on the
Detection and Prevention of Money Laundering and Terrorist
Financing Activities) provides measures for the identification of
prospective customers. The measures require the following information
to be obtained for corporate vehicles, whether locally incorporated or a
foreign company other bodies corporate or partnerships formed in
Jamaica or overseas:
• certificate of Incorporation or certificate of registration;
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deemed to be dissolution of the partnership and such partnership then
takes the form of a general partnership. Similarly, if a limited
partnership is continued beyond the time originally fixed for its
duration without re-registration it is deemed to be taken to be a general
partnership. The Public Record Office must be kept informed by the
general and special partners of the partnership’s continued existence.
The terms of the partnership must be published in the government
gazette.
80. Jamaica does not have any statutory provisions governing the
general (ordinary) partnerships, wherein all the partners have unlimited
liability for the partnership debts. Such partnerships are governed by
the common law and the partnership agreement. This ordinary
partnership does not have a legal personality of its own.
81. The Registration of Business Names Act requires every firm
having a place of business in Jamaica and carrying on business to
register with the Registrar of Companies. This Act defines the “firm” as
an unincorporated body of two or more individuals, one or more of
individuals and one or more corporations, or two or more corporations,
who have entered in to partnership with one another with a view to
carrying on business for profit, but shall not include any unincorporated
company, which was in existence on the seventeenth day of June
eighteen hundred and sixty four”. Section 5 requires the name,
surnames, nationality, the usual residence and the other business
occupation (if any) of each of the individuals who are partners, and the
corporate name and the registered office or principal office of every
corporation which is a partner. Therefore according to this act,
unlimited and limited partnerships having a place of business in
Jamaica and carrying on a business will need to register with the
Registrar of Companies and provide the aforementioned information,
notably the names of the partners.
82. Every registration or renewal of registration remains valid for
three years from the date of certificate of registration and requires to be
renewed. Section 8 requires all the changes in the particulars of the firm
to be intimated to the Registrar. Section 13 requires the registrar to
issue a Certificate of Registration. Inspection of documents is allowed
by the registrar. (s.18). Section 9 provides the punishment for firms or
persons making default as to particulars.
83. Considering the provisions of the Registration of Business
Names Act, the identity information of the partners of the partnership
should be available with the Registrar of Companies. This information
should also be available with regard to partnerships formed outside
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87. Partnerships are required to file a return of income and tax
payable in form IT 03. This form is prescribed for organisations
(unincorporated bodies other than life assurance) and building societies,
trust estates, industrial and provident societies, deceased estates also
use this form. The form requires the following information on the
partners/beneficiaries in case of partnerships and estates:
• taxpayer registration number;
• name;
Foreign partnerships
89. There is no specific regulation with regard to foreign
partnerships.
90. The assessment team is of the view that under the common
law it is not necessary to have a deed for the creation of partnership. It
is also not necessary that all the partnerships obtain business
registration number and TRN from Jamaican authorities. The Jamaican
authorities have however indicated that any foreign partnership with
substantial presence in Jamaica due to carrying on business or trade is
taxable in Jamaica and is required to file a tax return, which contains
details of the partners in the firm.
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96. Jamaica has stated that, the persons required to comply with
revenue law are mandated to register all deeds; whether it is a deed of
conveyance or otherwise. Pursuant to s.2-4 of the Stamp Duty Act and
the attached Schedule and sections 2 and 6 of the Records, Wills and
Patent Act, all deeds are required to be stamped and recorded at the
Records Office.
97. Section 4 of the Registration of Business Names Act provides
for the registration with Registrar of Companies by a nominee or trustee
and reads as follows:
Where a firm, individual, or corporation having place of business in
Jamaica carries on the business wholly or mainly as nominee or
trustee of or for another person, or other persons, or another
corporation, or acts as general agent for any foreign firm, the first
mentioned firm, individual, or corporation shall be registered in
manner provided by this Act ,and ,in addition to the other particulars
to be furnished and registered, there shall be furnished and registered
the particulars mentioned in the schedule”. The schedule requires the
additional particulars as the present Christian name and surname, any
former name, nationality, and, if that nationality is not the nationality
of origin, the nationality of origin, and usual residence or, as the case
may be, the corporate name, of every person, or corporation on whose
behalf the business is carried on: provided that if the business is
carried on under any trust and any of the beneficiaries are a class of
children or other persons, a description of the class shall be sufficient.
98. The above provisions indicate that is case of trust the full
information on beneficiaries is not required to be given if the same are a
class of children or other persons.
99. For registration under the business names act, the trusts are
required to submit the trust deed which has information on the
beneficiaries. A total of 999 trusts and 1 544 non-profit organisations
have obtained tax registration numbers (TRN). The TRNs are used to
register trust deeds for the purpose of tax administration. .
100. The trust not being a statutory entity, the information on
trusts is not in the public record except as discussed above, and the
details of the trust and the identities of those involved known to the
settler and the trustees only. Jamaica was asked to clarify whether the
information about all trusts created or administered in Jamaica would
be available with Record Office. However, Jamaica’s reply, is that the
Record of Deeds, Wills and Patent Act requires that all deeds, patents,
letters and wills should be recorded at the Island record office and any
deed not so recorded is void. There are neither restrictions on nor
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identity information on the units of trusts is required to be kept by such
trusts.
106. In cases of trusts also, the assessment team is of the view that
it is not necessary that all the Trusts obtain business registration number
and TRN from Jamaican authorities. The Jamaican authorities have
only stated that information will be available with regard to Trusts
doing business with Revenue and they have not categorically asserted
that all the Trusts are required to obtain such numbers/ registration.
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Jurisdictions should ensure that reliable accounting records are kept for
all relevant entities and arrangements.
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Jamaica, issue an order grant that exempts the company from keeping
proper books and documents of account (s.144(4)).
116. Section 144 of the Companies Act refers to the maintenance
of books of accounts by the company, as are necessary to exhibit and
explain the transactions and financial position of the trade or business
of the company including books containing entries from day to day in
sufficient details of all cash received and cash paid and goods sold and
purchased showing the goods and the buyers and sellers in sufficient
detail to enable these goods and their buyers and sellers to be identified.
117. The profit and loss account and balance sheet of the company
is required to be presented before the company at the annual general
meeting by the directors of the company (s.145). Furthermore, if the
company is registered on the Jamaica Stock Exchange, its balance sheet
must be published at the end of each financial year. The director of the
company is liable for the penalties as in the case of the offence of not
maintaining the proper accounts and not complying with the provisions
presenting the profit and loss account and balance sheet before the
company in the general meeting.
118. All public companies are required to file accounts annually to
the Registrar of Companies. This requirement also applies to private
companies wherein a body corporate is shareholder. These accounts are
in the form of the balance sheet and profit and loss account including
all the documents required by law to be annexed thereto and a copy of a
report of the auditor (s.124).
119. Section 18 of the Banking Act 1992 requires every local bank
and foreign bank to submit an audited balance sheet and profit and loss
account in respect of all businesses transacted by the bank in the
financial year and auditor’s report to the Bank of Jamaica. The accounts
are required to be prepared in accordance with the generally accepted
accounting principles as set out in the Handbook of the Institute of
Chartered Accountants of Jamaica. The bank is also subject to the
statutory publication requirements.
120. A company incorporated outside the Island and carrying on
business within the Island is required to prepare a balance sheet and
profit and loss account containing the particulars and documents,
similar to, as are required by a company incorporated in the island and
it is also required to deliver a copy of these documents to the Registrar
of companies for registration (s.366).
121. Section 89 of the ITA also requires every person to keep
proper books of accounts sufficient to record all transactions necessary
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to ascertain gains or loss. Domestic and foreign companies carrying on
business in Jamaica are required to keep their accounting records in
Jamaica and required at all times to have these open to inspection by
the directors. Exemption from keeping the records in Jamaica can be
authorised by an order of the Minister (s.144 (4)).
122. Private companies are subject to limited filing requirements
with the Registrar of Companies (s.124(3)). However, as mentioned
previously if a body corporate holds shares in the private company then
the exemption in this regard is not available.
123. The Partnership (Limited) Act and Trustees Act impose no
record keeping requirements on partnerships or trusts. However, s.89 of
the ITA imposes a compulsory requirement on every person engaged in
any trade, profession or business to keep proper books of account
sufficient to record all transactions necessary to ascertain the gains and
profits or loss incurred. The books of account should exhibit or explain
his transactions and financial position. In absence of proper books of
account, the Commissioner is empowered to assess the tax according to
the best of his judgement. Failures to comply with the provisions also
attract various penalties. As a result, taxpayers keep proper books of
account and records.
124. Similarly, entities operating in the Jamaica Export Free Zones
have to be companies incorporated in Jamaica. Section 46 of the
Jamaica Export Free Zones Act provides for the sanctions as per s.99 of
the ITA with regard to filing of false statements, false returns and for
keeping false accounts. Therefore, though these companies are not
liable to pay tax, these are required to maintain accounts.
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132. Where the company is dissolved, the information held by the
government entities is kept for the required period and then stored at the
government archives for up to 20 years pursuant to the Financial
Administration and Audit Act 1959.
133. The Bank of Jamaica, as per s.34A of the Bank of Jamaica
Act 1960, has power of supervision and periodical examination of all
commercial banks and financial institutions. The regulated entities
under the supervision and control of the BOJ and Financial Services
Commission are required to maintain the record of their customer
transactions for at least five years in view of the anti-money laundering
provisions.
134. On the basis of above, the assessment team determines that
Jamaican law does not expressly provide for the retention of the
accounting records for five years, except by the entities regulated by the
anti-money laundering laws.
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140. The BOJ AML/CFT Guidance Notes also requires financial
institutions to ensure that the due diligence checks and reviews and
investigations are available to the competent authority and designated
authorities under the anti money laundering laws.
141. POCA (MLP) Regulations 2007 provides for maintenance
and retention of the records of transactions between the banks and the
customers by the banks, the banks are also required to maintain
transaction records relating to walk-in customers.
• a person who—
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12
http://www.cfatf-gafic.org/downloadables/mer/
Jamaica_3rd_Round_MER_(Final)_English.pdf.
13
http://www.cfatf-gafic.org/downloadables/Jamaica_1st_Follow-
Up_Report_(Final)_English.pdf.
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• financial institutions should maintain records of client
identification and transactions performed. This should include the
minimum five year retention period from the termination of the
business relationship;
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B. Access to Information
Overview
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151. The tax authorities are required to request the information
from the taxpayer prior to seeking the production order from the court.
The taxpayer rights are duly protected through the judicial proceedings
though the laws specifically do not lay down the clear rules,
corresponding to the standards, providing for the safeguards to the
taxpayer and third parties.
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under the RAA may only be exercised when the person about whom
information is sought is under examination by the tax authorities in
Jamaica. The provision is used where the information is being sought
from specified bodies such as banks, building societies or other
financial institutions and the Commissioner must proceed by court
order.
155. Section 70(1) of the ITA provides as follows:
Every person, whether he is or is not liable to pay income tax, upon
whom the Commissioner of Inland Revenue may cause a notice to be
served requiring him to make and deliver a return of his income or
the income of any person, shall, within fifteen days after the date of
the service of such notice, make and deliver to the Commissioner of
Inland Revenue a return as aforesaid.
156. The Commissioner may therefore use this provision, in cases
falling outside the scope of the RAA, to seek information about the
income of any person. That person does not have to be under
examination by the tax authorities.
157. The Jamaican authorities acknowledge that there is some
conflict between both provisions and that there is a need to rationalise
the provisions so as to provide for the widest possible information
gathering powers.
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supervision by the Bank of Jamaica and talso be subject to AML/CFT
statutory obligations.
161. Under the Income Tax Act, information relating to postal
revenue is not available directly to the Commissioner of Inland
Revenue. However, postal workers are deemed to by the Postal Act to
be customs officers for the purpose of receipt of postal articles. All
information regarding articles imported through the post office and the
customs duties payable would be available to the Commissioner of
Customs.
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• a person who is or has been a party to any business transaction with
the taxpayer in question.
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172. The assessment team has analysed the powers available to the
tax authorities under the ITA as well as the RAA in connection with
obtaining information, and is of the view that the powers under the
RAA can be used in connection with the continuing tax examination in
case of a taxpayer in Jamaica. However, the powers available under the
ITA are wide and may be used against any taxpayer in Jamaica without
need for an examination to be conducted.
173. However, the problem lies on the question, whether the duties
of the Commissioner with regard to making an investigation into any
case involving tax evasion or for the prevention of fraud on the
revenue, would cover a case of a person being taxpayer in a foreign
jurisdiction with whom Jamaica has agreement in place for exchange of
information and information is sought by the competent authority of
that jurisdiction. Section 6(2) of the RAA provides that it shall be the
duty of the Revenue Protection Department to carry out investigations
into cases involving fraud against the revenue. The RAA defines the
revenue to mean all tolls, taxes, imposts, rates, duties, fees, levies,
fines, and other charges prescribed by or under any enactment. The
answer to this query would depend upon, whether the term “revenue”
also includes taxes levied in the foreign jurisdiction. This becomes an
interpretation issue and the assessment team does not wish to conduct
this exercise and may not be appropriate do so.
174. The assessment team is of the view that the tax authorities do
not have well defined powers to obtain information in the cases of
persons who are not taxpayers in Jamaica. This view is strengthened by
the language of RAA s.17G which requires the judge before issuing a
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production order to be satisfied that the Commissioner had first made
request to the taxpayer without success.
175. To conclude, the assessment team is of the view that the
powers of the tax authorities under the Revenue Administration Act and
the Income Tax Act are restricted so they can obtain information in case
of a taxpayer of Jamaica only and this is tantamount to the presence of
domestic tax interest in the tax laws of Jamaica.
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• the court can issue production order only in the case of a taxpayer
and the taxpayer in the RAA is defined as – “includes any person
whose liability to make payment of revenue to a revenue
department is in question whether or not, in the event, the payment
is waived or remitted or no amount is found payable”;
180. The protocol to the Jamaican tax treaty with Spain provides
that the Minister has the power to obtain bank information. Jamaica has
clarified that the requirements of approaching the court before
obtaining the information from the banks also applies to the Minister.
181. Jamaica requires that the requesting state, when seeking bank
information, should normally submit a request letter setting out the
nature and purpose of the request, the name of the taxpayer and any
relevant records on the taxpayer. The Jamaican tax authorities would
then request information from the bank in accordance with domestic
law.
182. The tax authorities can obtain bank information with respect
to persons under examination in Jamaica only and cannot thus request
the bank information if the person is not already under tax examination
in Jamaica, who is the subject of the EOI request. The assessment team
is, therefore, of the view that though the tax treaty with Spain provides
that the Minister has power to obtain bank information, the requisite
information cannot be obtained if the person concerning whom request
is made is not a taxpayer in Jamaica.
183. Information concerning the members of companies and their
holdings is available in the register of members maintained by the
company. These documents are available for inspection during office
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hours to the members and to the public after payment of a fee. The tax
authorities do not have any powers to obtain information about the
identity and ownership of the company directly from the company, if
such a request is not in relation with the assessment of taxpayer (s.75(5)
ITA). The tax authorities can obtain the information about members by
inspecting the register of members as per the procedure outlined in
s.112 of the Companies Act by paying the inspection fee.
184. The judicial procedure prescribed in s.17G of the RAA will
only be available if the requested information is in relation with:
establishing an assessment with respect to a taxpayer under any relevant
law, any case involving tax evasion or for the prevention of fraud on the
revenue, determining the tax liability of a taxpayer under a relevant
law; or collecting any outstanding amount owed by a taxpayer on
account of tax, penalty, interest or fine under any relevant law.
185. The information about the identity of the owners that hold
share warrants cannot be obtained as it is neither available with the
company or the regulatory authorities.
186. Partnerships and trusts are required to file information about
the identity and holding of each partner or beneficiary as the case may
be to the tax authorities in the form of a tax return (Form IT-03). The
tax authorities would be in a position to provide the information
available in the tax returns in response to EOI request. If the
partnerships/trusts have not delivered their tax returns to the tax
authorities then tax authorities would be required to initiate proceedings
specified in ITA s.70 against defaulting partnerships/trusts. As noted
previously, the tax authorities cannot obtain information from the
partnership or trusts, if no tax proceedings are pending in respect of
person for which information is requested. The information about new
trustees can be obtained by the Commissioner from Record Office,
referred to in s.10(6) of the Trustees Act, by using powers contained in
s.70(5) of the ITA.
187. Jamaica has replied that non-charitable trusts are required to
file income tax returns, therefore the information about the settlers,
trustee and beneficiaries are available in the tax returns of such trusts.
The assessment team verified the information available in the tax
form14 and such form does not require providing the information about
the settlors of the trust, though the information on beneficiaries is
available. The charitable trusts file their annual financial statements to
14
http://www.jrs.gov.jm/home_template.php?page=forms&ye=1&desc=Incom
e+Tax.
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the government of territory outside Jamaica with regard to relief from
double taxation. But, due to domestic tax interest requirements it may
not be possible to provide the requested information.
193. 194. The power to obtain information is very limited
because tax authority can only obtain information if the taxpayer is
currently under examination. A jurisdiction should have no restrictions
on information exchange caused by the domestic tax interest
requirement. The TOR (B.1.3) provides that competent authorities
should use all relevant information-gathering measures to obtain the
information requested, notwithstanding that the requested jurisdiction
may not need the information for its own tax purposes (e.g. information
should be obtained whether or not it relates to a taxpayer that is
currently under examination by the requested jurisdiction).
Compulsory powers (ToR B.1.4)
195. As discussed above the powers to obtain information are
limited to information held by the taxpayer if he is under examination
or information already held by government authorities.
196. Under the EOI arrangements, the Contracting State is not
obliged to provide information not obtainable under the domestic laws
or in the normal course of the administration of that or other
Contracting State. The powers of inspection, search and seizure of
documents, though available in Jamaican law, are subject to certain
requirements as provided above, it may therefore be that if these
requirements are not met Jamaica can refuse to resort to such methods
for responding to information requests from the tax authorities of other
countries.
197. The assessment team is of the belief that clear laws or
regulations should be adopted that allow for the Jamaican tax
authorities to have the necessary powers to issue a notice to any person
residing in the territorial jurisdiction of Jamaica, who is suspected to
have information in his possession or control, to produce the
information and give evidence in connection with any proceedings to
comply with its obligations under EOI arrangement. This power to
issue the notice should not be limited by the fact that such person
should be under tax examination. This power may be subject to internal
controls and safeguards to avoid the misuse.
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banks. The official or the person, having access to records of the bank
or the material with regard to the account of any customer of the bank,
are prohibited from giving, divulging or revealing such information.
The contravention of the provisions on conviction provides a fine up to
USD 2 000 000 or to imprisonment for a term up to two years or to both
such fine and imprisonment.
199. However, the above stated secrecy rule can be overridden if
one or more of the 13 circumstances described in the Fourth Schedule
of the Banking Act. These include:
• the information is disclosed to an authorised officer (Supervisor,
Deputy Supervisor or any other person authorised to perform
functions on behalf of the Supervisor or the Deputy Supervisor
under Bank of Jamaica Act);
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specified financial institution, obtained in consequence of the
performance of his duties under the Act. Provisions of s.47 require the
officers and servants and auditors of the bank to preserve and aid in
preserving secrecy. Unauthorised disclosure constitutes an offence.
202. There is no restriction in the company law for providing the
information to the tax authorities. But, s.390 of the Companies Act
provides that a person who has acted as attorney for the defendant
cannot be required to disclose any privileged communication to him in
the capacity of attorney.
203. Section 4 of the ITA requires every person involved in the
administration of the act to deal with all documents, information,
returns, assessment lists and copies of such lists relating to the income
or items of income of any person as secret and confidential. However,
communicating the information or contents of documents for the
purpose of the act and to the person authorised by the Minister is
permitted. Similar secrecy provisions are available in s.17H of the
RAA, s.19A of the Customs Act, s.37 of the Transfer Tax Act, s.8 of
the Asset Tax Act and s.59B of the Securities Act.
204. Section 17H of the RAA, s.62 of the General Consumption
Tax Act and s.59B of the Securities Act has additional provisions of
secrecy applicable to the persons to whom the information is
communicated. They shall regard and deal with such information as
secret and confidential and shall make and subscribe a declaration to
that effect before a Justice of the Peace.
205. The secrecy provisions available under various acts can be
overridden under various circumstances, as in the case of the Banking
Act and Financial Institutions Act discussed above. The information
can be obtained by the Commissioner by obtaining production order.
The tax authorities share information for the purposes of the act. Due to
these specific safeguards inbuilt in the law, the information can be
made available to the tax authorities and a secrecy provision as such
does not act as a barrier to information exchange.
206. Contravention of the secrecy provisions amounts to an
offence under the respective enactments and also under the ITA.
Section 83 of the ITA authorises the Minister to make orders declaring
arrangements to be in force with other territories with a view to
affording relief from double taxation and s.83(4) provides that when
such arrangements have effect, the obligation as to secrecy imposed by
s.4 shall not prevent the disclosure to any authorised officer of the
Government with which arrangements are made, of such information as
is required to be disclosed under the arrangement. Due to these specific
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The rights and safeguards (e.g. notification, appeal rights) that apply
to persons in the requested jurisdiction should be compatible with
effective exchange of information.
209. The domestic law does not require that the person who is the
subject of the request be notified that such a request has been made.
Section 17G of the RAA provides that the Judge in Chambers may
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issue production orders after satisfaction that the Tax Commissioner
has requested the information from the taxpayer without success.
Therefore, the taxpayer is notified.
210. The limits on information exchange due to rights and
safeguards are provided in the 2002 OECD Model Agreement on
Exchange of Information on Tax Matters and its commentary and in
Article 26 of the OECD Model Tax Convention on Income and on
Capital and its commentary. The assessment team could find out the
provisions for these rights and safeguards of taxpayers and third parties
in the domestic laws of Jamaica as mentioned below:
• s.45(1) of the Banking Act allows the authorisation by the Minister
to share information with the foreign countries if he is satisfied that
such sharing of information is in public interest; and
211. The Income Tax Act and the Revenue Administration Act do
not provide the safeguards to the taxpayer or third parties with regard
to the following, as the acts do not mention that the Minister will
decline exchange of information where the information is:
• covered by attorney client privilege;
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Determination and factors underlying recommendations
Determination
The element is in place, but certain aspects of the legal
implementation of the element need improvement.
Factors underlying Recommendations
recommendations
Taxpayers’ rights are It is recommended that certain
protected by the judicial exceptions from prior notification be
procedures for gathering permitted (e.g. in cases in which the
information. To require in all information request is of a very urgent
cases that the taxpayer be nature or the notification is likely to
first approached, and thus undermine the chance of success of
notified, may unduly prevent the investigation conducted by the
or delay the effective requesting jurisdiction).
exchange of information in
urgent cases.
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C. Exchanging Information
Overview
15
Jamaica also has a tax treaty with Switzerland. However, this treaty does not
have an exchange of information article and is thus not considered in this
analysis.
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Foreseeably relevant standard (ToR C.1.1)
219. Jamaica has bilateral tax treaties with 11 countries namely
Canada, the Peoples Republic of China, Denmark, France, Germany,
Israel, Norway, Spain, Sweden, the United Kingdom and the US.
Jamaica is also a member of the CARICOM Multilateral Tax Treaty,
which is signed by 11 jurisdictions, the other 10 are: Antigua and
Barbuda, Barbados, Belize, Dominica, Grenada, Guyana, St. Kitts and
Nevis, St. Lucia, St. Vincent and the Grenadines, and Trinidad and
Tobago. Jamaica has also signed a tax information exchange agreement
(TIEA) with the USA. All of Jamaica’s treaties and its TIEA are in
force.
220. The agreements with Canada, China, Denmark, France,
Israel, Norway, Sweden, the United Kingdom, the United States and the
CARICOM agreement provide for the exchange of information as is
“necessary” for carrying out the provisions of the convention or of the
domestic laws of the Contracting states concerning the taxes covered by
the agreements. The agreement with Spain uses the word “foreseeably
relevant” in place of “necessary”. The commentary to Article 26 of the
OECD Model Tax Convention, in paragraph 5 refers to this standard of
“foreseeable relevance” and states that the Contracting States may
agree to an alternative formulation of this standard that is consistent
with the scope of the Article (e.g. by replacing ”foreseeably relevant”
with “necessary” or “relevant”). In view of this recognition of term
“necessary”, all the agreements meet the “foreseeably relevant”
standard.
221. One of Jamaica’s agreements - with Germany - provides for
the exchange of information that is ‘necessary’ for carrying out the
provisions of the agreement, but does not specifically provide for the
exchange of information in aid of the administration and enforcement
of domestic laws.
222. Therefore, all but one of Jamaica’s agreements meets the
foreseeably relevant standard.
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for the exchange of information for the carrying out of the provisions of
the agreement, is therefore only applicable provided one of the persons
concerned is resident in one of the Contracting States. Therefore, all
but one of Jamaican agreements allow for exchange of information with
respect to all persons.
16
See Tax Co-operation 2009 –Towards a Level Playing Field.
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• information about competent authorities’ powers to access bank
information to obtain ownership, identity and accounting
information for the purpose of exchange of information is not
available with respect to Guyana and Trinidad and Tobago, so it is
not possible to confirm that the CARICOM treaty with those
jurisdictions meets the OECD standard;
• Saint Kitts and Nevis has enacted the Saint Christopher and Nevis
(Mutual Exchange of Information on Tax Matters) Act 2009 which
provides that all types of information may be obtained and shared
with treaty partners (civil as well as criminal);
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of such State with respect to its own taxes. The protocol to treaty with
Spain also provides that, if specifically requested the contracting state
shall provide information to the extent allowable under its domestic
laws, in the form of depositions of witnesses and authenticated copies
of the original records. Though this provision is not provided in other
tax treaties, there appears to be no restrictions in Jamaica as far as the
same is consistent with its own domestic law and administrative
practices.
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Determination
effective exchange of and strengthening its international
information to the standard. agreements to meet the
international standard, including by
incorporating text in its exchange of
information articles corresponding
to paragraphs 4 and 5 of Article 26
of the Model Tax Convention.
• 8 of the 27 EU members;
238. Jamaica has a fairly good tax treaty network covering its
major trading partners, but not with all the significant economies in its
region with whom it has sizeable business, such as Brazil and
Venezuela. Jamaica is planning to develop an international financial
services centre; therefore, it is necessary to have tax treaties in place
with other major investing economies.
239. No information has been received which would suggest that
Jamaica has not entered into an agreement with any jurisdiction when it
has been requested to do so.
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Determination and factors underlying recommendations
Determination
The element is in place
Factors underlying Recommendations
recommendations
It is recommended that the Jamaican
government continue to conclude
agreements with additional relevant
partners.
C.3. Confidentiality
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All other information exchanged (ToR C.3.2)
245. The confidentiality provisions in the DTCs and in Jamaica’s
domestic law do not draw a distinction between information received in
response to requests and information forming part of the requests
themselves. As such, these provisions apply equally to all requests for
such information, background documents to such requests, and any
other document reflecting such information, including communications
between the requesting and requested jurisdictions and communications
within the tax authorities of either jurisdiction.
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COMPLIANCE WITH THE STANDARDS: EXCHANGING INFORMATION – 75
Determination
The assessment team is not in a position to evaluate whether this
element is in place, as it involves issues of practice that are dealt
with in the Phase 2 review
Factors underlying Recommendations
recommendations
Jamaica should act on the
recommendations noted in respect of
other essential elements to ensure
that information requests can be
responded to in a timely manner.
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SUMMARY OF DETERMINATIONS AND FACTORS UNDERLYING RECOMMENDATIONS – 77
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78 – SUMMARY OF DETERMINATIONS AND FACTORS UNDERLYING RECOMMENDATIONS
Factors underlying
Determination Recommendations
recommendations
provide information control basis, it
identifying their owners as a should require
part of registration submission of
requirements and foreign information on its
companies are not required owners when
to compulsorily keep a foreign companies
share register in Jamaica. register or when
Therefore, the information they apply for their
that identifies the owners of tax file number and
foreign companies is not Jamaica should
available. take necessary
steps to require
foreign companies
to keep registers of
Jamaican
shareholders in
Jamaica.
Jurisdictions should ensure that reliable accounting records are kept for all
relevant entities and arrangements. (ToR A.2)
There is no clear Relevant legislation
requirement that relevant for each type of
entities and arrangements entity and
keep underlying arrangement
documentation. should provide for
the obligation to
keep underlying
The element is in place, documentation.
but certain aspects of Jamaica could, for
the legal implementation example, ensure
of the element need the maintaining of
improvement records and
underlying
documents by
prescribing tax
audits of persons
having a turnover
in excess a
threshold amount.
The Jamaican company and The relevant laws
tax laws does not prescribe should be
a compulsory retention amended to
period for records other specify the
than financial institutions retention period of
and other entities regulated at least five years
under anti-money in respect of
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SUMMARY OF DETERMINATIONS AND FACTORS UNDERLYING RECOMMENDATIONS – 79
Factors underlying
Determination Recommendations
recommendations
laundering legislation. accounting records
for all the entities
Banking information should be available for all account-holders. (ToR A.3)
The element is in place
Competent authorities should have the power to obtain and provide information
that is the subject of a request under an exchange of information arrangement
from any person within their territorial jurisdiction who is in possession or control
of such information (irrespective of any legal obligation on such person to
maintain the secrecy of the information). (Tor B.1)
The powers of Jamaica’s The tax authorities
tax authorities to obtain should be granted
information for exchange of the power to obtain
information from the information that is
taxpayer or third parties are the subject of
subject to there being a request under an
The element is not in
domestic tax interest. exchange of
place
information
notwithstanding
Jamaica might not
need the
information for its
own tax purposes.
The rights and safeguards (e.g. notification, appeal rights) that apply to persons
in the requested jurisdiction should be compatible with effective exchange of
information. (ToR B.2)
Taxpayer’s rights are It is recommended
protected by the judicial that certain
procedures for gathering exceptions from
information. To require in prior notification be
all cases that the taxpayer permitted (e.g. in
be first approached, and cases in which the
The element is in place, thus notified, may unduly information request
but certain aspects of the prevent or delay the is of a very urgent
legal implementation of effective exchange of nature or the
the element need information in urgent notification is likely
improvement. cases. to undermine the
chance of the
success of the
investigation
conducted by the
requesting
jurisdiction).
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80 – SUMMARY OF DETERMINATIONS AND FACTORS UNDERLYING RECOMMENDATIONS
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SUMMARY OF DETERMINATIONS AND FACTORS UNDERLYING RECOMMENDATIONS – 81
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ANNEXES – 83
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ANNEXES – 85
17
Antigua and Barbuda, Barbados, Belize, Dominica, Grenada, Guyana, St. Kitts
and Nevis, St. Lucia, St. Vincent and the Grenadines and Trinidad and Tobago.
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ANNEXES– 87
Commercial Laws
The Companies Act 2004
The Co-operative Societies Act 1950
The Friendly societies Act 1968
The Partnership(Limited) Act 1853
The Trustees Act 1897
Taxation Laws
The Income Tax Act 1955
The Foreign Sales Corporation Act 1984
The Hotel (Incentives) Act 1968
The International Finance Companies(Income Tax Relief) Act 1971
The Revenue Administration Act 1985
The Transfer Tax Act 1971
The Tax collection Act 1867
Banking Laws
The Banking Act 1992
The Bank of Jamaica Act 1960
The Financial Institutions Act 1992
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88 – ANNEXES
Bank of Jamaica Anti-Money Laundering(AML)/Combating the
Financing of Terrorism(CFT) Policy 1999
Bank of Jamaica – 2004 Guidance Note on the Detection and
Prevention of Money Laundering and Terrorist Financing Activities.
Other
The Building Societies Act 1955
The Insurance Act 2001
The Jamaica Export Free Zones Act 1982
The Legal Profession Act 1972
The Limitation of Actions Act 1881
The Trustees, Attorneys and Executors (Accounts and General) Act
1904
The Public Accountancy Act 1970
The Record Office Act 1879
The Record of Deeds, Wills and Letters Patent Act 1681
The Unit Trusts Act 1971
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ANNEXES– 89
Relevant Laws
The Revenue Administration Act 1985 (the RAA) deals with the
administration of the revenue department and provides for the creation
of five administrative departments namely; Inland Revenue
Department, Revenue Protection Department, Tax Administration
Services Department and Customs Department. s.9(d) of the Act refers
to safeguarding the interest of Jamaica in the negotiation of
international taxation agreements. The negotiation of international
taxation agreements is the responsibility of the tax administration
services department.
The Income Tax Act 1955 (the ITA) regulates the taxation of
income of residents as well as non-residents in Jamaica. It is
administered by Commissioners appointed under the provisions of the
Revenue Administration Act 1955. Section 83 provides powers to the
Minister to enter into tax treaties. Section 83(4) overrides the secrecy
provisions imposed on the tax authorities by s.4 of the Act and allows
disclosure of information to the authorities of other territories under the
arrangement. It is also provided that the provisions of the arrangement
shall have effect in relation to income tax notwithstanding anything
contained in any enactment.
The Companies Act 2004 repealed and replaced the previous
Companies Act. It empowers the Government to regulate all company
matters including formation, capital, functioning, audit, supervision,
returns, mergers, takeovers and liquidation of companies.
The Partnership (Limited) Act 1853 deals with the law relating to
limited partnerships, i.e. partnerships where one or more partners have
unlimited liability for partnership debts ("general partners"), and one or
more partners have liability for those debts only up to the amount of
capital they have subscribed ("special partners"). Limited partnerships
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90 – ANNEXES
are not allowed to carry on banking or insurance businesses. Jamaica
has no statute law on ordinary partnerships, i.e. partnerships in which
all the partners have unlimited liability for the partnership's debts.
Ordinary partnerships are governed by the common law of England
which Jamaica inherited, and by the partnership agreement. A
partnership may not have more than 20 members.
The Registration of Business Names Act 1934 – This Act makes it
compulsory for every person to register the business name with the
Registrar of Companies of Jamaica.
The Trustees Act 1897 provides for the, various powers and duties
of trustees, power of the courts etc. Under this Act ” “trust” does not
include the duties incident to an estate conveyed by way of mortgage;
but with this exception the expressions ‘‘trust’’ and “trustee” include
implied and constructive trusts, and cases where the trustee has a
beneficial interest in the trust property, and the duties incident to the
office of personal representative of a deceased person.
The Securities Act 1993 governs the law relating to the business in
securities including mutual funds. It provides for the creation of
commission which is responsible for the general administration of the
Act. It also provides for the creation and regulation of the central
security depositories.
The Proceeds of Crime Act 2007 (POCA) consolidated all
Jamaican legislation with respect to matters related to money
laundering and forfeiture. POCA permits any crime to constitute a
predicate offence for money laundering. Section 92 provides that
money laundering is an act comprising dealings of any kind with
criminal property. Both criminal property and criminal conduct are
defined by the POCA.
Government authorities
The Ministry of Finance and the Public Service (MOFPS)18 has
overall responsibility for the Government’s fiscal and economic policy
framework and collecting and allocating public revenues. The MOFPS
is responsible for the effective regulation of the country’s financial
institutions and its 14 divisions including financial regulation, corporate
services, taxation policy, financial investigations and revenue
protection.
18
http://www.mof.gov.jm.
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ANNEXES– 91
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92 – ANNEXES
financial sector comply with anti-money laundering and counter-
terrorist financing provisions (AML/CFT) and has issued the
AML/CFT guidance note and FSC guideline for implementing the
provisions of the POCA. The BOJ has supervisory oversight over
institutions governed by the following pieces of legislation:
• Commercial Banks which are governed by the Banking Act;
These statutes provide the legal and policy parameters for the
licensing and supervision of financial institutions. The primary
legislation consists of the Bank of Jamaica Act 1960, the Banking Act
1992, and the Financial Institution Act 1992 and the Building Societies
Act 1897.
The Ministry of Industry, Investment and Commerce21 – This
ministry is responsible amongst other things, for the Companies Act
and Registration of Business Names Act, which are important for the
purpose of this report. It is also the administrative and supervisory
ministry for the company’s office of Jamaica, registrar of co-operative
and friendly societies and the Jamaica Free Zones.
The Financial Services Commission (FSC) was established in
August 2001 under the Financial Services Commission Act. It is the
integrated regulator of financial services in Jamaica and administers the
Insurance Act, Securities Act, Unit Trusts Act and Pensions
(Superannuation Funds and Retirement Schemes) Act.
The Registrar of Companies - Jamaica has a centralised registry
of companies, the Registrar of Companies. The Office of the Registrar
of Companies is part of the Ministry of Industry, Commerce &
Technology. (Jamaica may clarify what is the correct name of this
ministry, as website sows both names). The registrar of companies
registers local and overseas companies, industrial and provident
societies and individuals carrying on business in Jamaica. The registrar
of companies maintains a website22on which the subscribers may view
21
http://www.jis.gov.jm/commerce_science/index.asp.
22
http://www.orcjamaica.com/profile.
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ANNEXES– 93
23
http://www.mof.gov.jm/fid.
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94 – ANNEXES
• Regulation 7(2) of the POCA(MLP) Regulations require customer
due diligence measures comprising transaction verification
procedures to be applied particularly in the circumstances specified
in regulation 7(3) which include where there is a doubt about the
accuracy of any previously obtained evidence of identity. The
continuity of business relationship is prohibited if this requirement
cannot be fulfilled by the financial institution.
Record keeping
• Regulation 14 of POCA (MLP) Regulations, 2007 mandate the
retention of both identification records and transaction records by
financial institutions for the prescribed period of 5 years
commencing from the date on which the relevant financial
business was completed or the business relationship terminated
whichever is later.
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ANNEXES– 95
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96 – ANNEXES
registration by all public accountants providing services in Jamaica.
The Jamaica has another Institute of Chartered Secretaries and
Administrators, whose members provide services relating to company
formation. Real estate dealers are governed by the requirements of the
Real Estate Dealers and Developers Act, which are enforced by the
Real Estate Board.
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