Florida Senate - 2016 COMMITTEE AMENDMENT
Bill No. SB 1106
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LEGISLATIVE ACTION
Senate . House
Comm: RCS .
02/24/2016 .
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Appropriations Subcommittee on General Government (Hays)
recommended the following:
1 Senate Amendment (with title amendment)
2
3 Delete everything after the enacting clause
4 and insert:
5 Section 1. Present subsections (10) and (11) of section
6 663.01, Florida Statutes, are renumbered as subsections (11) and
7 (12), respectively, and a new subsection (10) is added to that
8 section, to read:
9 663.01 Definitions.—As used in this part, the term:
10 (10) “International trust entity” means an international
11 trust company, an international business, an international
12 business organization, or an affiliated or subsidiary entity
13 that is licensed, chartered, or similarly permitted to conduct
14 trust business in a foreign country or countries under the laws
15 of which it is organized and supervised.
16 Section 2. Section 663.041, Florida Statutes, is created to
17 read:
18 663.041 Moratorium on the office’s enforcement of licensing
19 requirements for an international trust entity or related
20 entities.—
21 (1) The office shall delay the enforcement of the
22 requirement under s. 663.04(4) relating to licensure of an
23 organization or entity in this state providing services to an
24 international trust entity that engages in the activities
25 described in s. 663.0625. This delay extends to any person who
26 manages or controls or is employed by such organization or
27 entity that:
28 (a) Has been organized to conduct business in this state
29 before October 1, 2013;
30 (b) Has not been fined or sanctioned as a result of any
31 complaint to the office or to any other state or federal
32 regulatory agency;
33 (c) Has not been convicted of a felony or ordered to pay a
34 fine or penalty in any proceeding initiated by any federal,
35 state, foreign, or local law enforcement agency or international
36 agency within the 10 years before the effective date of this
37 section;
38 (d) Has not had any of its directors, executive officers,
39 principal shareholders, managers, or employees arrested for,
40 charged with, convicted of, or pled guilty or nolo contendere
41 to, regardless of adjudication, any offense that is punishable
42 by imprisonment for 1 year or more, or to any offense that
43 involves money laundering, currency transaction reporting, tax
44 evasion, facilitating or furthering terrorism, fraud, or that is
45 otherwise related to the operation of a financial institution,
46 within the 10 years before the effective date of this section;
47 (e) Does not provide services for any international trust
48 entity that is in bankruptcy, conservatorship, receivership,
49 liquidation, or a similar status under the laws of any country;
50 (f) Does not provide banking services or promote or sell
51 investments or accept custody of assets;
52 (g) Does not act as a fiduciary, which includes, but is not
53 limited to, accepting the fiduciary appointment, executing the
54 fiduciary documents that create the fiduciary relationship, or
55 making discretionary decisions regarding the investment or
56 distribution of fiduciary accounts; and
57 (h) Conducts those activities permissible for an
58 international trust company representative office as described
59 in s. 663.0625.
60 (2) This moratorium does not prevent the office from
61 otherwise enforcing the financial institutions codes.
62 (3) An organization or entity that seeks consideration for
63 this moratorium shall notify the office in writing by letter on
64 official letterhead via United States Postal Service or
65 commercial mail delivery service by July 1, 2016, and shall
66 provide the following:
67 (a) Written proof that it has been organized to do business
68 in this state before October 1, 2013;
69 (b) The name or names under which it conducts business in
70 this state;
71 (c) The addresses of its locations from which it conducts
72 business;
73 (d) A detailed list and description of the activities being
74 conducted at the locations from which it conducts business. The
75 detailed description must include the types of consumers that
76 utilize those activities and an explanation of how those
77 activities serve the business purpose of an international trust
78 entity.
79 (e) As to each international trust entity the organization
80 or entity provides services for in this state, the following:
81 1. The name of the international trust entity;
82 2. A list of the current officers and directors of the
83 international trust entity;
84 3. The country or countries where the international trust
85 entity is organized;
86 4. The supervisory or regulatory authority, or equivalent
87 or other similarly sanctioned body, organization, governmental
88 entity, or recognized authority that has licensing, chartering,
89 oversight, or similar responsibilities over the international
90 trust entity;
91 5. Proof that the international trust entity has been
92 authorized by a charter, license, or similar authorization by
93 operation of law in its home country jurisdiction to engage in
94 trust business;
95 6. Proof that the international trust entity lawfully
96 exists and is in good standing under the laws of the
97 jurisdiction where it is chartered, licensed, organized, or
98 lawfully existing. The organization or entity shall submit a
99 certificate of good standing or equivalent document issued by
100 the supervisory or regulatory authority, or equivalent or other
101 similarly sanctioned body, organization, governmental entity, or
102 recognized authority that has similar responsibilities, of the
103 country where the international trust entity is licensed,
104 chartered, or has similar authorization by operation of law and
105 is duly organized and lawfully exists;
106 7. A statement that the international trust entity is not
107 in bankruptcy, conservatorship, receivership, liquidation, or in
108 a similar status under the laws of any country; and
109 8. Proof that the international trust entity is not
110 operating under the direct control of the government,
111 regulatory, or supervisory authority of the jurisdiction of its
112 incorporation, through government intervention or any other
113 extraordinary actions, and confirmation that it has not been in
114 such a status or under such control at any time within the 7
115 years before the date of notification to the office.
116 (f) A declaration under penalty of perjury signed by an
117 executive officer or managing member of the organization or
118 entity, declaring that the information provided to the office is
119 true and correct to the best of his or her knowledge.
120 (4) In processing the notification and request to qualify
121 for moratorium, the office shall confirm the following:
122 (a) That the international trust entity is adequately
123 supervised by the appropriate regulatory authority, or
124 equivalent or other similarly sanctioned body, organization,
125 governmental entity, or recognized authority that has similar
126 responsibilities in the foreign country where it is organized,
127 chartered, or licensed, or has similar authorization by
128 operation of law; and
129 (b) That the jurisdiction of the international trust entity
130 or its offices, subsidiaries, or any affiliates that are
131 directly involved in or facilitate the financial services
132 functions, banking, or fiduciary activities of the international
133 trust entity, is not listed on the Financial Action Task Force
134 Public Statement or on its list of jurisdictions with
135 deficiencies in anti-money laundering or counterterrorism.
136 (5) For purposes of establishing adequate supervision under
137 paragraph (4)(a):
138 (a) An international trust entity with foreign
139 establishments is considered adequately supervised if it is
140 subject to consolidated supervision. As used in this paragraph,
141 “consolidated supervision” means supervision that enables the
142 appropriate regulatory authority, or equivalent or other
143 similarly sanctioned body, organization, governmental entity, or
144 recognized authority that has similar responsibilities of the
145 home country (home country supervisor) to evaluate:
146 1. The safety and soundness of the international trust
147 entity’s operations located within the home country supervisor’s
148 primary jurisdiction; and
149 2. The safety and soundness of the operations performed by
150 the international trust entity’s offices, subsidiaries, or any
151 affiliates that are directly involved in or facilitate the
152 financial services functions, banking, or fiduciary activities
153 of the international trust entity, wherever located.
154 (b) An international trust entity with no foreign
155 establishments is considered adequately supervised if the home
156 country supervisor can evaluate the safety and soundness of the
157 international trust entity’s operations through its offices or
158 subsidiaries located in the home country. For purposes of this
159 paragraph, the home country supervisor is deemed to be able to
160 evaluate the safety and soundness of the international trust
161 entity if the home country supervisor has the authority to
162 collect and maintain information on the following regulatory
163 components:
164 1. The technical competence and administrative ability of
165 the management of the international trust entity;
166 2. The adequacy of the operational, accounting, and
167 internal control systems of the international trust entity,
168 particularly the international trust entity’s ability to monitor
169 and supervise the activities of its offices or subsidiaries
170 wherever located;
171 3. The adequacy of asset management and asset
172 administration policies and procedures;
173 4. The capital adequacy of the international trust entity,
174 its offices or subsidiaries as specified by any capital adequacy
175 guidelines in the home country;
176 5. The earnings of the international trust entity; and
177 6. The external and internal auditors’ reports as well as
178 any management comment letters or any documented corrective
179 action by management.
180 (c) As used in paragraphs (4)(a), (5)(a), and (5)(b),
181 adequate supervision does not necessarily require supervision of
182 companies that control the international trust entity or
183 supervision of companies under common control with the
184 international trust entity but that are not in the international
185 trust entity’s chain of control. However, in cases where a
186 holding company is the only controlling element in a trust
187 business group, holding company supervision by a home country
188 supervisor shall be required when it is needed to ensure
189 consolidated supervision of all trust business entities in the
190 group.
191 (d) If a holding company is not supervised, adequate
192 supervision is deemed to exist if the home country supervisor
193 regulates transactions between the international trust entity
194 and controlling persons or entities under common control.
195 (e) An international trust entity and its offices or
196 subsidiaries is deemed to be adequately supervised if it is
197 subject to comprehensive supervision. For purposes of this
198 paragraph, comprehensive supervision:
199 1. Means supervision that ensures that the supervisory
200 processes and procedures are designed to inform the home country
201 supervisor about the international trust entity’s financial
202 condition, including capital position; asset management and
203 asset administration; internal controls and audit; compliance
204 with existing laws and regulations; and capability of
205 management.
206 2. Does not require the home country supervisor to conduct
207 onsite examinations of the international trust entity or its
208 offices or subsidiaries. However, at a minimum, it requires that
209 the home country supervisor:
210 a. Is able to determine that the international trust entity
211 and its offices and subsidiaries have adequate procedures for
212 monitoring and controlling its domestic and foreign operations;
213 b. Is authorized to obtain information, by examination,
214 audits or by other means, on the domestic and foreign operations
215 of the international trust entity, including its offices and
216 subsidiaries, and the authority to demand financial reports
217 which permit analysis of the consolidated condition of the
218 international trust entity;
219 c. Is able to obtain information on the dealings and
220 relationships between the international trust entity and its
221 offices and subsidiaries, wherever located; and
222 d. Is authorized by the home country’s laws to ensure the
223 safety and soundness of the international trust entity and its
224 offices and subsidiaries.
225 3. Includes the ability and willingness of the home country
226 supervisor to provide the office early notice of any weaknesses
227 being experienced by the international trust entities, including
228 its offices or subsidiaries wherever located.
229 4. Includes the ability of the home country supervisor to
230 provide the office assurance of cooperation by both the
231 international trust entity and the home country supervisor.
232 (6) The office shall process requests made by notification
233 for inclusion under the moratorium as follows:
234 (a) Upon receipt of any request, the office shall review
235 the information contained therein, and request any additional
236 information to complete the notification within 30 days after
237 receipt. The organization or entity shall provide the requested
238 additional information within 45 days after the receipt of the
239 notice from the office. If the office does not make such request
240 within 30 days after receipt, the notification is deemed
241 complete as of the date it was received.
242 (b) Within 20 days after receipt of any additional
243 information requested, the office shall deem the notification
244 complete or provide notification to the organization or entity
245 that the information provided does not satisfy the office’s
246 request or requests.
247 (c) Within 90 days after receipt of a completed
248 notification, the office shall confirm with the organization or
249 entity that they are or are not a party to the moratorium. If
250 the office fails to notify the organization or entity within
251 such time whether or not the organization or entity is a party
252 to the moratorium, then the organization or entity is considered
253 a party to the moratorium by operation of law.
254 (g) During the period of the moratorium, the office may
255 conduct an onsite visitation of an organization or entity to
256 confirm information provided to the office in deeming the
257 organization or entity qualified for the moratorium.
258 Section 3. Section 663.041, Florida Statutes, and the
259 amendments to section 663.01, Florida Statutes, made by this
260 act, are repealed on July 1, 2017.
261 Section 4. This act shall take effect upon becoming a law.
262
263 ================= T I T L E A M E N D M E N T ================
264 And the title is amended as follows:
265 Delete everything before the enacting clause
266 and insert:
267 A bill to be entitled
268 An act relating to international trust entities;
269 amending s. 663.01, F.S.; defining the term
270 “international trust entity”; creating s. 663.041,
271 F.S.; providing for a moratorium for a specified
272 timeframe on enforcement by the Office of Financial
273 Regulation of certain licensure requirements for
274 certain organizations and entities providing services
275 to international trust companies; providing conditions
276 to extend the moratorium to specified persons of the
277 organization or entity; providing for construction;
278 specifying requirements for a letter to the office to
279 qualify as a party to the moratorium; requiring the
280 office to confirm specified findings when processing a
281 request; specifying circumstances for establishing
282 adequate supervision; providing procedures and
283 timeframes for the office’s processing of requests and
284 the office’s requests for additional information;
285 providing timeframes for the office to confirm with
286 the organization or entity whether it has been
287 confirmed as a party to the moratorium; providing for
288 construction if certain timeframes are not met;
289 authorizing the office to conduct an onsite visitation
290 of an organization or entity for a specified purpose
291 until a specified time; providing for future repeal;
292 providing an effective date.