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Licence Restrictions and Revocation: New Rules Impose Tougher Sanctions
The St. Helena government has introduced new regulations that will restrict or revoke licences issued to financial institutions under certain circumstances. These measures are aimed at protecting depositors, investors, and creditors by ensuring that licensed businesses comply with regulatory requirements.
New Rules for Licence Restrictions and Revocation
According to the new rules, a licence may be restricted or revoked if:
- Any document or information provided in connection with an application for a licence is found to be false or misleading.
- A licence holder ceases to operate in St. Helena for more than six months without prior notification.
- A licence holder fails to comply with any provision of the Financial Services Ordinance, directives issued under it, or conditions attached to their licence.
- A licence holder no longer possesses adequate resources or is likely to become unable to meet its obligations towards investors, depositors, or creditors.
- A licence holder has insufficient assets to cover its liabilities or has suspended payment.
- The Regulatory Authority considers that the interests of depositors, investors, or creditors are threatened due to the manner in which a business operates or proposes to operate its affairs.
- A licence holder is in material breach of any provision of the Money Laundering Ordinance 2008.
Imposed Restrictions
The Regulatory Authority may impose restrictions on a licence holder’s operations, including:
- Requiring the removal of an officer
- Divestment of shareholdings
- Prohibition from undertaking certain transactions
Notice and Consultation
Before imposing or varying any restriction or revoking a licence, the Regulatory Authority will serve written notice to the affected business, specifying the grounds for action and providing a 21-day period for representations. The authority may also consult with competent authorities outside St. Helena if a branch of a relevant business is incorporated in another country.
Notification of Revocation or Restriction
In cases where a licence is revoked or restricted, the Regulatory Authority must inform competent authorities outside St. Helena where the affected business operates.
Review Process
Individuals who are aggrieved by decisions made by the Regulatory Authority under these new rules may seek a review, which will not suspend the operation of the decision. The authority will reconsider its decision in light of any additional information submitted in support of the request.
Enhancing Investor Confidence and Protecting Interests
These stricter regulations aim to enhance investor confidence and protect the interests of depositors, investors, and creditors in St. Helena’s financial sector.