Due to high risk of financial loss associated with financial dealing, Vanuatu Financial Services Commission (VFSC) has announced amendments to the current Financial Dealers Act, with increase of obligatory charges being among the major changes. Amended Bill for financial dealers came into force as of 8 January, 2019, and Existing companies must be in compliance with the new requirement by 7 July 2019.

According to VFSC it is important to increase fees so that the VFSC only deals with entities who are willing to meet in full their obligations under the Act. Along with increase of fees, the minimum insurance cover for a licensee has been raised to VT 5.000.000 for each claim with an aggregate cover of not less than VT50.000.000 and a maximum deductible amount of VT500.000

As a way of assisting and monitoring financial dealing businesses, the proposed amendments now divided dealer’s licenses into 3 different categories namely Class A Principal’s License, Class B Principal’s License and Class C Principal’s License. A person intending to conduct business dealing with each type of security must obtain respective license. This will boost the VFSC monitoring capabilities of this sector and would also empower VFSC to be able to ascertain and control the business made in this sector.

Among the above-mentioned changes it also worth to note that an applicant is now required to have at least 5 years’ experience dealing in securities in order to be qualified for a Representative of a licensee.

The amendments also concern the physical presence criteria; hence manager or director of the company shall reside for six months within a year in Vanuatu. The company also must acquire a physical office located in Vanuatu which shall maintain a certain list of software systems.

Beside the above, it is worth to mention that from now on an independent auditor of the licensee must receive a previous consent from the VFSC before to performing an inspection.

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