MOU with the Jersey Financial Services Commission
MINISTER FOR ECONOMIC DEVELOPMENT
MOU with the Jersey Financial Services Commission
- Issue and Recommendation
1.1. The MOU is an updated version of the original MOU between Economic Development and the Jersey Financial Services Commission (“the Commission”) dated March 2005, amended to reflect the change to Ministerial Government and changes to the Financial Services Commission (Jersey) Law 1998 made by L.33/2007.
1.2. It is recommended that the Minister signs the updated MOU and directs that it be sent to the Commission for signing.
- Background
2.1. Article 12 of the Financial Services Commission (Jersey) Law 1998 (“the Law”) provides that:
“(1) The Minister may, after consulting the Commission and where the Minister considers that it is necessary in the public interest to do so, give to the Commission guidance or give in writing general directions in respect of the policies to be followed by the Commission in relation to the supervision and development of financial services in Jersey and the manner in which any function of the Commission is to be carried out.
(2) It shall be the duty of the Commission in carrying out any of its functions to have regard to any guidance and to act in accordance with any directions given to it by the Minister under this Article.”
2.2. In March 2005, the Commission and the Minister entered into a Memorandum of Understanding to clarify certain matters concerning the use of the power granted to the Minister under Article 12 of the Law. This followed concern expressed by the International Monetary Fund that the power of the Minister (formerly a power of the Economic Development Committee) to give guidance or direction to the Commission “could affect the operational independence of the Commission and its carrying out of its regulatory obligations”.
2.3. The Minister confirmed in the MOU that the powers granted to him under Article 12 of the Law would only be used when exceptional circumstances make it necessary to do so in the public interest, and that there is no intention to use the powers on a regular, or routine, basis.
2.4. Following the change from Committee to Ministerial government and changes to the Law made by L.33/2007, references in the MOU need to be updated.
- Recommendation
3.1. It is recommended that the Minister signs the updated MOU and directs that it be sent to the Commission for signing.
DIRECTOR, FINANCE INDUSTRY DEVELOPMENT