
Madam Speaker,
As I rise to my feet today to deliver my contribution for this debate, I feel great pride as a Bahamian – a citizen of the best little country in the world.
We may be small in size but we accomplish big things. It’s never a good idea to underestimate us.
Our success with financial services is a testament to this fact. We continue to stand among the top financial services jurisdictions in the world.
This is no lucky accident or happenstance. This industry was strategically built and guided over the years to excel.
Today, as we debate the Bill before us, we recognise it is the superior expertise of Bahamian professionals that enables us to stand tall as a leading jurisdiction for wealth management, banking, and fiduciary services.
Thank you to the teams at the Ministry of Finance, the Ministry of Economic Affairs, Office of the Attorney General and other agencies who have contributed to the sector’s development – they were instrumental in developing this amendment and many others before it.
Madam Speaker,
The Automatic Exchange of Financial Account Information (Amendment) Bill 2025 further strengthens our legislative framework in keeping with the OECD’s Common Reporting Standards.
We continue to adhere to the highest standards as we coordinate with nations across the world to combat tax evasion and increase transparency in the financial services sector.
The principal act, the Automatic Exchange of Financial Account Information Act, was enacted in 2016 to ensure that The Bahamas was compliant with the OECD’s Automatic Exchange standards.
Over 100 jurisdictions are committed to upholding these standards to ensure that local financial institutions are identifying non-resident account holders, reporting on pertinent financial information, such as their account balances, interest, and dividends, and automatically exchanging this information with other jurisdictions.
In its 2018 Peer Review Report for The Bahamas, the OECD’s Global Forum Secretariat made a number of recommendations for the improvement of our legislative framework. The report recognised our efforts but also pointed to several areas of needed improvement.
Since then, we have amended the act as necessary to ensure full compliance with the Common Reporting Standards – or CRS as they are commonly called.
Fortunately, we were well-positioned to make the necessary changes to strengthen our legislative framework.
I don’t think any country has a higher rate of per capita financial services talent than The Bahamas. The local financial services industry is a showcase of Bahamian excellence, so it should surprise no one that we continue to lead the way, regionally and globally.
In the roughly three and a half years since taking office, this Administration has relied on this stellar local expertise to navigate the changing regulatory landscape.
We have worked hard to promote The Bahamas as a safe harbour for investments, as well as wealth management.
It is well known that we are among the best jurisdictions to grow and manage wealth.
Investors recognise this fact. That’s why we’ve brought in over $10 billion and counting in the past three years.
It’s why our financial services sector continues to stand strong despite the many changes in the global regulatory landscape.
Our responsiveness and ability to adapt to regulatory and market changes have kept us punching above our weight as a regional giant in financial services.
In the past year alone, we’ve made a number of changes to retain our competitiveness.
We have rolled out key amendments to maintain our competitive edge in the Brazilian market, especially now that the once-innovative ICONs have become obsolete.
The DARE Act has undergone multiple revisions, with more to come as the industry continues to grow and change.
Our approach to business licences for IBCs has been overhauled, and the regulatory framework for the Securities Commission has been modernised.
Previous missteps by our predecessors in the implementation of economic substance reporting – an issue that led to the EU blacklisting – have been corrected.
Thanks to the swift intervention of our compliance and financial services experts, we’re now officially off the EU’s blacklist.
As we maintain consistency with global best practices, our AML-CFT-CPF regime remains robust.
Meanwhile, the smooth rollout of the Domestic Minimum Top-Up Tax has not only kept us aligned with international corporate income tax standards, but also created a valuable new revenue stream for the government.
The introduction of the Top-Up Tax means we can raise additional revenue without placing further strain on Bahamian families, many of whom have experienced considerable hardship during the global inflation crisis.
We have also maintained our status as largely compliant with the FATF’s 40 Recommendations, being among the first countries in the world to achieve this coveted status.
And we have updated many of the systems and frameworks impacting financial services. For example, the digitalised Corporate Administrative Registry Service Portal (or CARS portal) allows users to incorporate new companies, file corporate documents, pay annual fees, and obtain certified copies of corporate documents—all from the comfort of their home or office.
Then there is the partitioning of the Registrar General’s Office into a Registrar of Records and a Registrar of Companies, allowing us to dedicate resources and personnel to an efficient digital transition of filings and records.
To sum it all up, we are in a season of innovation and growth for the financial services sector.
As a nation, we’ve been able to implement changes that industry observers predicted would destroy our sector – instead, we’ve turned those changes into strengths.
Remember how I said we shouldn’t be underestimated? When you’re a small country, you learn how to turn challenges into opportunities.
The very compliance-related hurdles that were predicted to hinder our sector have become a selling point as we clear hurdle after hurdle.
As a result, we can proudly proclaim that there are very few countries that can match us when it comes to progress, innovation, and compliance.
Let me be clear, however, that our compliance with regulatory demands is accompanied by robust advocacy for our country.
It is well known that global standards for financial transparency have not always been administered fairly.
Not all countries play by the same rules.
Some countries end up on blacklists and graylists while others seem to escape that fate, despite the same or inferior compliance records.
Under this administration, for the first time ever, we have a strong voice on the international stage pushing for change to the status quo.
We were early champions of a United Nations Convention on International Tax Cooperation, voicing strong opposition to the OECD’s approach toward small financial services centres like ours.
So, today, as we debate a Bill to meet the OECD’s Common Reporting Standards, we are demonstrating that we can comply – and will comply – but compliance is not the same thing as accepting business as usual.
Through our advocacy, we have secured a seat at the table as a part of the Intergovernmental Negotiating Committee on the United Nations Framework Convention on International Tax Cooperation.
We will play an active role in shaping protocols to ensure that these global changes are developed and administered fairly in the future.
Our Attorney General, Hon. Ryan Pinder, represents us and is playing an important role in these critical negotiations at the United Nations, and will continue to serve as a member of the Intergovernmental Negotiating Committee.
Madam Speaker,
As we look forward to changes in the global regime, we remain fully committed to our compliance agenda.
Last year, we made improvements to our domestic legal framework for the Automatic Exchange of Financial Account Information in preparation for the second round review by the OECD, which is ongoing.
Those changes included the removal of the Bahamas Executive Entities from the list of categories of jurisdiction-specific Non-Reporting Financial Institutions, as well as the widening of the scope of legal powers to prevent and address circumvention of CRS standards in The Bahamas.
We also granted the Ministry of Finance access power to inspect records during onsite visits and updated the list of jurisdictions for which we have active CRS-AEOI relationships.
In making these amendments, we demonstrated to our peers that we have an effective regime in place to monitor financial institutions’ compliance with international standards with strong anti-avoidance and anti-circumvention provisions.
Today, we are here to build on these changes to further strengthen our framework.
Last year, as The Bahamas’ legislative framework was re-assessed by the OECD. A deficiency was identified.
More specifically, The Bahamas’ legislative framework has an anti-circumvention rule that does not cover all relevant persons that may engage in practices to avoid due diligence and reporting. It was necessary to amend the existing language to be more broad in scope.
The anti-circumvention rule being insufficient in scope is a relatively common issue, and a number of Jurisdictions had to make amendments to their legislative framework to reflect the correct language in the AEOI Standard.
However, as The Bahamas is currently undergoing the second round of effectiveness review by the OECD’s Global Forum’s Transparency and Exchange of Information for Tax Purposes Common Reporting Standard for the – Automatic Exchange of Information (what we call the “CRS – AEOI standard”), it is important for The Bahamas to adopt the correct wording as the anti-avoidance rule cannot be partial in scope.
So, the Bill before us today accomplishes a few things.
First of all, it introduces a definition for the term “connected persons” to specify exactly who such connected persons are in the context of the principal act.
Any individual or company with beneficial ownership of 10% or more of an investment fund is now specified as belonging to this list of connected persons.
Any individual or company controlled by another individual or company with 10% or more ownership is also defined as a connected person.
Any director or officer belonging to any of these funds, companies, or groups must also comply with requests for information.
So, the threshold for connected persons is set at 10%, including the wider network of groups, companies, and individuals connected to the individual or company with beneficial ownership. This brings us in compliance with our wider AML and KYC standards as advised by the OECD.
This Bill also clarifies the alignment between local guidelines and CRS standards, replacing the words “issue guidelines” in section 10A of the principal act with the words “issue CRS Guidelines” and specifying that the Ministry of Finance may issue a compliance notice with all terms and conditions outlined in writing.
The other notable change is a substitution in section 15, broadening the scope of the legislation by applying the anti-avoidance standard to any person entering into an arrangement or engaging in practices to avoid obligations imposed under this Act.
This ensures that when avoidance or circumvention takes place, all Reporting Financial Institutions and relevant persons will report as if the circumvention or avoidance never took place – meaning they will supply all related information inclusive of any information they attempted to exclude from reporting.
In introducing this clause, we intend to meet the requirement that the application of the standard be broad enough to capture all attempts at avoidance and circumvention.
Madam Speaker,
We are cognizant of the fact that The Bahamas’ financial services regime, together with its OECD initiatives, falls under the watchful eyes of the European Union.
With these amendments, we are taking proactive steps to avoid being placed on the European Union’s list of non co-operative Jurisdictions for CRS-AEOI purposes in 2026.
The Bill before us today introduces relatively straightforward but important changes to the principal Automatic Exchange of Financial Account Information Act, bringing us in compliance with international standards and demonstrating our willingness to work together with other jurisdictions to promote transparency and eliminate tax evasion.
It is of the utmost importance for our financial services industry to ensure that, as our framework is reviewed by the OECD for effectiveness, we are assessed as compliant with CRS-AEOI standards.
Through the Automatic Exchange of Financial Account Information (Amendment) Bill 2025, we are signalling to the world, yet again, how seriously we take our commitment to transparency, compliance, and developing the strongest AML-CTF-CPF and anti-tax evasion framework in the world.
And we are signalling to investors and those in need of wealth management services that we continue to be a safe harbour for their financial services needs.