St Kitts & Nevis
Saint Kitts & Nevis is not on the FATF List of Countries that have been identified as having strategic AML deficiencies
In May 2014, The CFATF acknowledged “the significant progress made by St. Kitts and Nevis in improving its AML/CFT regime and notes that St. Kitts and Nevis has established the legal and regulatory framework to meet its commitments in its agreed Action Plan regarding the strategic deficiencies that the CFATF had identified. St. Kitts and Nevis is therefore no longer subject to the CFATF ICRG monitoring process.”
Compliance with FATF Recommendations
The last Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Saint Kitts & Nevis was undertaken by the Financial Action Task Force (FATF) in 2009. According to that Evaluation, Saint Kitts & Nevis was deemed Compliant for 8 and Largely Compliant for 8 of the FATF 40 + 9 Recommendations. It was Partially Compliant or Non-Compliant for 5 of the 6 Core Recommendations.
US Department of State Money Laundering assessment (INCSR)
St. Kitts and Nevis is categorised by the US State Department as a Country/Jurisdiction of Primary Concern in respect of Money Laundering and Financial Crimes.
St. Kitts and Nevis is a federation composed of two islands in the Eastern Caribbean. Its economy is reliant on tourism and its economic citizenship program, offshore financial services sector, corporate registries, and shipping registry. St. Kitts and Nevis is making progress in its AML regime.
The Financial Services Regulatory Commission (FSRC) (St. Kitts branch) is responsible for the licensing, regulation, and supervision of the non-bank financial sector in St. Kitts. As of September 2019, the regulated entities supervised by the St. Kitts Branch are two insurance managers, 48 trust and service providers, 16 domestic insurance companies, 11 MSBs, four credit unions, and one development bank. There is no recent information on the number of IBCs, limited liability companies, or trusts in Saint Kitts.
The FSRC (Nevis branch) is responsible for the licensing, regulation, and supervision of regulated persons and entities in Nevis that conduct fiduciary and international financial services businesses. As of September 2019, the regulated entities supervised by the Nevis Branch are 16 insurance managers, two international banks, 53 registered agents/service providers, three international insurance brokers, five MSBs, and 234 international insurance companies. FSRC Nevis statistical bulletins reflect the establishment of 814 IBCs, 453 LLCs, 93 trusts, and 14 foundations in 2019.
EU Tax Blacklist
St Kitts & Nevis was removed from the EU Tax Blacklist on 25 May 2018
There are no international sanctions currently in force against this country.
BRIBERY & CORRUPTION
Rating (100-Good / 0-Bad)
Transparency International Corruption Index N/A
World Governance Indicator – Control of Corruption 68
The economy of Saint Kitts and Nevis depends on tourism; since the 1970s, tourism has replaced sugar as the economy’s traditional mainstay. Roughly 200,000 tourists visited the islands in 2009, but reduced tourism arrivals and foreign investment led to an economic contraction in 2009-2013, and the economy returned to growth only in 2014. Like other tourist destinations in the Caribbean, St. Kitts and Nevis is vulnerable to damage from natural disasters and shifts in tourism demand.
Following the 2005 harvest, the government closed the sugar industry after several decades of losses. To compensate for lost jobs, the government has embarked on a program to diversify the agricultural sector and to stimulate other sectors of the economy, such as export-oriented manufacturing and offshore banking. The government has made notable progress in reducing its public debt, from 154% of GDP in 2011 to 83% in 2013, although it still faces one of the highest levels in the world, largely attributable to public enterprise losses.
Agriculture - products:
sugarcane, rice, yams, vegetables, bananas; fish
tourism, cotton, salt, copra, clothing, footwear, beverages
Exports - commodities:
machinery, food, electronics, beverages, tobacco
Exports - partners:
US 44.4%, Poland 14.6%, Bangladesh 10.1%, Azerbaijan 4.3% (2015)
Imports - commodities:
machinery, manufactures, food, fuels
Imports - partners:
US 37.7%, Trinidad and Tobago 22.7%, Barbados 4.4% (2015)
Investment Climate - US State Department
The Federation of Saint Kitts and Nevis (St. Kitts and Nevis) remains one of the fastest growing economies in the Eastern Caribbean with an estimated Gross Domestic Product (GDP) of USD $637.13 million. Saint Kitts and Nevis is a member of the Organization of Eastern Caribbean States (OECS), the Eastern Caribbean Currency Union (ECCU) and the Eastern Caribbean Central Bank. According to the ECCB, Saint Kitts and Nevis is projected to grow by 4.65% in 2016 and its outlook remains stable. Income from the citizenship by investment program, construction sector, manufacturing and tourism is expected to keep the economy buoyant during the year. Saint Kitts and Nevis is ranked 124th in the World Bank’s Doing Business report for 2016; falling two places from its 2015 ranking.
The Government of Saint Kitts and Nevis strongly encourages foreign direct investment. Saint Kitts and Nevis’ foreign direct investment policy is to attract Foreign Direct Investment into the priority sectors as identified under the National Diversification Strategy. These include financial services, tourism, real estate, agriculture, information technology, education services and limited light manufacturing.
The government instituted a number of investment incentives for businesses considering the possibility of locating in Saint Kitts or Nevis, encouraging both domestic and foreign private investment.
Companies registered in Saint Kitts and Nevis have the right to repatriate all capital, royalties, dividends and profits free of all government taxes or any other charges on foreign exchange transactions. There are no exchange controls in Nevis and the invoicing of foreign trade transactions may be made in any currency.
Saint Kitts and Nevis uses eminent domain laws that allow the government to expropriate private property for the betterment of the public. Currently the United States Embassy in Bridgetown is aware of one outstanding case involving the seizure of private land by the Government of St. Kitts and Nevis. The previous government agreed to pay the U.S. citizen claimant in installments, and completed the first two installments. The current government defaulted on one installment, and despite a court in St. Kitts and Nevis ordering the government to complete the 2015 installment, the government has yet to do so. The government claims that another individual made a claim on the property, and the government will investigate the other claim before completing the installment to the U.S. citizen owner. For this reason, the U.S. Embassy in Bridgetown continues to recommend caution when investing in real estate or conducting business in Saint Kitts and Nevis.
Saint Kitts and Nevis uses transparent policies and effective laws to foster competition and establish clear rules for foreign and domestic investors in the areas of tax, labor, environment, health, and safety. Saint Kitts and Nevis’ monetary and exchange rate policies are determined by the ECCB. The ECCB regulates domestic banks in Saint Kitts and Nevis. Exchange controls restrictions on capital and non-trade current transactions have been suspended under the Exchange Control Act.
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