CONSTITUTION OF THE OFFSHORE GROUP OF BANKING SUPERVISORS

CONSTITUTION OF THE OFFSHORE GROUP OF BANKING SUPERVISORS

Interpretation

1. Unless the context otherwise requires, in this constitution :-

Formation and Constitution of the Group

2. The Group was formed in October, 1980 as an association of the relevant authorities in jurisdictions identified at that time as 'offshore finance centres' concerned with the supervision of banks and related financial services primarily engaged in cross-border activities.

Objects of the Group

3. The objects of the Group are:-

to allow members to identify and discuss issues of mutual interest, establish an identity of purpose and share knowledge and experiences;
to participate with relevant international organisations in setting and promoting the implementation of international standards for cross-border banking supervision, and for combating money laundering/terrorist financing;
to encourage members to apply high standards of supervision based on internationally accepted principles;
to promote a general raising of standards among member jurisdictions through a peer group approach and mutual independent evaluation;
to agree and promote a positive, constructive and coordinated response to the approaches made by other supervisory authorities for assistance in the effective consolidated supervision of international banks;
to promote the adoption of a Statement of Best Practice for Trust and Company Service Providers.

Conditions of Membership

4. The Group has set the following conditions of membership:-

a clear commitment is made to the Basel Committee on Banking Supervision’s Core Principles;
a clear commitment is made to the 40 Recommendations of the Financial Action Task Force on money laundering, and the 9 Special Recommendations of the Task Force on terrorist financing;
the necessary legislation and administration to put these commitments into effect is in place or in early prospect;
there is evidence of either a satisfactory track record of translating the commitments into effect or a detailed plan for doing so within a reasonable time frame;
the commitments are entered into with the knowledge and support of the relevant political authority.

Application for Membership

5. Applications by jurisdictions for Membership require:-

a written submission confirming the jurisdiction's commitment to meet the conditions of Membership, including copies of relevant legislation; and
a report on a mutual evaluation/assessment of compliance with the international standards for financial regulation, anti-money laundering and combating terrorist financing which evaluation/assessment has been carried out by an independent third party (e.g. IMF, FATF style regional body).

Application for Observer Status

6. Application can be made for Observer status in advance of full membership. Observer status is offered for a transitional period of up to two years for those jurisdictions that have entered into the commitments referred to in paragraph 4 above, but where there is not yet an independent mutual evaluation/assessment providing evidence either of a satisfactory track record of translating the commitments into effect or a detailed action plan for doing so within a reasonable time frame.

7. If at the end of the transition period the conditions for full membership are still not met the Group will decide either to extend the transition period or withdraw the observer status.

Approval of Applications for Membership or Observer Status

8. The admission of new Members and the granting of Observer Status shall be subject to the approval of the Group.
Standards and Guidelines

9. The Group from time to time either separately, or in conjunction with another relevant authority such as the Basel Committee on Banking Supervision, will issue statements of best practice or minimum standards.

Evaluation of Members

10. From time to time Members and Observers will be subject to evaluation exercises carried out by independent third parties approved by the Group in respect of their compliance with the conditions of membership.

Meetings

11. (a) The Group shall hold at least one general meeting each year at which
at least two thirds of members shall be present.
      (b) Decisions of the Group shall be reached on a consensual and not a majority voting basis.
      (c) Notice of each general meeting shall be given to each Member and Observer by the Chairman no less than two calendar months before the date of the meeting.
      (d) With the approval of the Group an extraordinary general meeting may be held at the request of the Chairman or individual members of the Group for which the notice requirement in para 10(c) may be waived.
      (e) Any member may give notice to the Chairman of a matter that it wishes to place on the agenda for the next meeting of the Group.

Sub-Committees

12. With the approval of the Group sub-committees of the Group may be formed to address specific issues.

Fees

13. Each Member and Observer shall pay an annual subscription in such amount as the Group may determine at a general meeting. All subscriptions shall be paid to the Group and shall be declared to be a debt due to the jurisdiction of the Chairman at the time being.

Termination and Suspension of Membership

14. (a) A member may resign with immediate effect by giving notice thereof to the Chairman.
      (b) With the approval of the Group at a general meeting the Membership or Observer status of any jurisdiction may be terminated or suspended where Members are satisfied that the jurisdiction is not complying with the terms and conditions of Membership or Observer status.
      (c) With the approval of the Group at a general meeting Membership of a jurisdiction may be changed to that of Observer status.
      (d) A Member or Observer shall be given due notice of any proposal to terminate or suspend Membership or Observer status, or to change from Membership to Observer status, and will be given the opportunity:-

to provide members with a written statement of its case; and
by its representatives, to address the meeting of the Group at which the proposal is to be considered.

The Chair

15. The Chairman shall be elected by the Group at a general meeting and the appointment shall be subject to confirmation each year at a general meeting.

16. The Chairman shall preside at all meetings of the Group at which he or she is present. In the absence of the Chairman a Chairman shall be appointed from those present at the meeting.

17. With the approval of the Group, the Chairman may act on behalf of the Group when representing the Group at meetings of international organisations such as the Basel Committee on Banking Supervision and the Financial Action Task Force on money laundering.

Treasurer

18. A Treasurer shall be appointed with the approval of the Group and shall be a representative of a Member jurisdiction. Alternatively, with the approval of the Group, the role of Treasurer may be performed by an appropriate officer(s) of a member jurisdiction that the Group has agreed is to provide all secretariat services.

Secretary

19. A Secretary may be appointed with the approval of the Group and shall be a representative of a member jurisdiction. Alternatively, the role of Secretary may be performed by an appropriate officer(s) of a member jurisdiction that the Group has agreed is to provide all secretariat services.

Accounts

20.   (a) It shall be the duty of the Treasurer to keep accounts of the financial affairs of the Group in accordance with generally accepted accounting principles.
       (b) At a general meeting each year a statement of accounts will be presented in respect of the financial year immediately preceding the date of such meeting. Such accounts shall be open to inspection by any Member or Observer.
       (c) The financial year of the Group shall end on the 31st December of each year.
       (d) A professionally qualified auditor shall be appointed annually by the Group to audit the Group's accounts.
       (e) All subscriptions and any donations or other funds which the Group may receive shall be held in an account in the name of the Group in a regulated financial institution in the jurisdiction of the Treasurer.
       (f) Any payment out of the Group's account and any other matters relating to the account shall require two signatories, neither of whom shall be the Chairman, one of whom shall be the Treasurer and the other a representative of a Member jurisdiction.
Alternatively, with the approval of the Group, the financial affairs of the Group may be dealt with within the financial accounts of a relevant body of a member jurisdiction that the Group has agreed is to provide all secretariat services.

Register of Members/Observers

21. There shall be a register of Members and Observers kept by the Chairman in which shall be recorded every Member and Observer of the Group. The following information shall be recorded against each Member or Observer:-

the address, including fax number and e-mail address, for service of all notices or documents;
the name and address of the person or persons nominated to represent the member or observer with respect to the affairs of the Group.

Notices

22. A notice may be served on the representative of a Member or Observer recorded in the Group's register of Members and Observers personally, by pre-paid post in an envelope addressed to the address of the Member or Observer shown in the register, by facsimile transmission to the fax number of the Member or Observer shown in the register or by e-mail to the e-mail address of the Member or Observer shown in the register.

Winding Up

23. The Group may be wound up with the approval of the Group. In this event the Chairman shall organise for it to be wound up in an orderly fashion and for the Group's assets to be realised and after payment of any liabilities to be distributed equally between its Members and Observers in proportion to their relative paid subscriptions for the year then current or on such basis as a the Group as a whole may decide at a general meeting.

Amendment of Constitution

24. Any revocation, amendment or addition to this constitution shall require the approval of the Group.