Seychelles' financial sector works to achieve EU standards - Moving into era of innovative products

The exercise is also looking at the practical challenges in achieving EU tax standards. (401(K) 2012/Flickr) Photo License: CC BY-SA 2.0

Identifying ways to improve Seychelles' financial sector and make it more prominent was the aim of a consultation meeting between key partners in the financial services sector on Thursday.

The meeting is part of a collaboration between Transparency Initiative Seychelles (TIS), the EU and the Financial Services Authority (FSA). Present at the meeting was the ambassador of the EU to Mauritius and Seychelles, Vincent Degert. 

"Today we are offering you this platform as a beginning for knowledge sharing and open dialogue, which hopefully will mold building blocks to help consolidate and bring our financial services to blossom, and to always remain compliant to a larger extent to the requirements of the industry," said TIS chairman Chrystold Chetty in his opening address.

The consultation is part of a wider exercise being conducted in the sector which aims to identify the weaknesses of relevant legislation. The exercise is also looking at the practical challenges in achieving EU tax standards and requirements as well proposing solutions for the weaknesses identified and documented. At the end of the exercise, there will be proposals for new products for the sector.

Seychelles, an archipelago in the western Indian Ocean, was removed from the EU tax haven blacklist in late 2021 after a number of amendments and legislation were introduced to ensure compliance with EU standards.

The consultation is part of a wider exercise being conducted in the sector which aims to identify the weaknesses of relevant legislation. (Sedrick Nicette, Seychelles News Agency) Photo License: CC-BY

The island nation was previously blacklisted by the EU, which was concerned with the territorial tax system adopted in December 2018 as it felt that "this can facilitate double non-taxation and that there can be revenue that is not being taxed in any jurisdiction."

Another concern of the EU was that Seychelles did not get a rating at least largely compliant with the Organisation for Economic Co-operation and Development (OECD) global forum on the exchange of tax information with other countries.

"While we must admit that there have been great improvements in the context of Seychelles, our stories remain untold and unknown and our offshore sector still bears a hard tint from past activities," said Chetty.

He added that "changes need to be made to allow a healthy environment that will attract good elements of the financial sectors, especially as Seychelles moves into the era of innovative financial products."

Chetty added that "we have to be mindful of the ever-evolving political and regulatory landscape and the ongoing pressures brought forth by our trade partners. Coming to add onto this have been the findings in the Pandora Papers, the ongoing war in Ukraine and the continuing hunt for assets of Russian oligarchs which have found their way to be clandestinely hidden through offshore companies in certain jurisdictions."

Participants who attended the meeting were able to view a number of presentations and later share their input. A consultant from the Island Legal Solutions will then present recommendations to the government for future improvements.