UK money-laundering moves will hit Caribbean economy

Subject

The impact of anti-money laundering legislation.

Significance

The UK Sanctions and Anti-Money Laundering Act approved on May 23, 2018 requires British Overseas Territories (OTs) to introduce by December 31, 2020 public registers of the beneficial ownership of companies and trust funds registered in each OT. The OTs affected by this legislation are Anguilla, Bermuda, the British Virgin Islands (BVI), Cayman Islands, Montserrat and Turks and Caicos Islands.

Impacts

• Company registrations provide jobs in the legal and compliance fields and will remain a key contributor to government revenue.
• The fall in company registrations in the BVI will likely spread to other OTs and accelerate in the wake of the Act.
• Given the number of EU banks in the OTs, the Brexit impact will be severe if financial institutions there lose access to the EU market.