Cook Islands Banking Regulations: Licensees Face Consequences for Non-Compliance

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As the one-year anniversary of the Cook Islands’ banking license approaches, regulators are reminding licensees that failure to comply with regulations can result in serious consequences.

Consequences of Non-Compliance

• Failure to pay an annual fee by the due date will result in a prescribed surcharge, which is recoverable in a court of competent jurisdiction.
• A licensee who continues to carry on banking business after failing to pay an annual fee or surcharge can commit an offense and face a fine not exceeding $50,000.

License Revocation and Suspension

• The Commission may revoke or suspend a license if:
  • A licensee fails to commence carrying on banking business within three months of the issue date.
  • A licensee ceases to carry on banking business for more than three months.
  • A licensee fails to pay their annual fee in accordance with Section 13.
• In these cases, the Commission must give the licensee 30 days’ notice before revoking or suspending the license.

Effects of Revocation and Suspension

• A revoked or suspended license takes effect on the date the notice is given to the licensee.
• The licensee must immediately cease carrying on banking business and return all copies of their license to the Commission.

Extension of Suspension Period

• The Commission may extend the period of suspension for up to 30 days if it determines that it is in the public interest.

Notice of Revocation or Suspension

• A notice of revocation or suspension will be published on the Commission’s website.

Appeal Process

• Licensees who are affected by a decision to revoke or suspend their license have the right to appeal to the Court within 21 days of the date the license was revoked or suspended.

Surrender of License

• Licensees who cease carrying on banking business in the Cook Islands may apply to surrender their license if they can produce evidence that they have repaid all deposits held or administered by them.
• The Commission may approve the surrender of the license and publish a notice of the surrender in any publication it considers appropriate.

Commission Functions

• Undertaking prudential supervision of banking business
• Reviewing banking business
• Implementing internationally accepted standards for prudential supervision

Reminder to Licensees

As the anniversary of their license approaches, licensees are reminded to ensure that they comply with all regulations and requirements to avoid any potential consequences.