Financial Services (Administrative Penalties) Regulations (Revised 2020)

Summary

These Regulations set out the framework under which the BVI Financial Services Commission may impose administrative penalties on licensees (and unlicensed persons carrying on financial services business) for contraventions of the Financial Services Commission Act, financial services legislation, the Regulatory Code, or Commission directives. They establish the notice and representation procedure, penalty ranges by category of contravention, a separate late payment penalty regime, appeal rights, and limitation periods.

• Penalty procedure: The Commission must send a notice of proposed penalty stating the contravention, proposed amount, and the licensee's right to make representations within 21 days before issuing a final written penalty notice.
• Payment deadline: A licensee that receives a penalty notice (including a late payment penalty notice) must pay the stated amount within 14 days of receipt.
• Appeal: A licensee aggrieved by a penalty decision or amount may appeal to the Appeals Board within 14 days of receiving the penalty notice; an appeal does not stay the obligation to pay.
• Late payment penalties: Separate penalties (calculated under Schedule 2) apply where a licensee fails to pay any fee, charge, or penalty by its due date, escalating in tiers based on how many 30-day periods payment is overdue, capped at 100% of the amount owed.
• Penalty ranges (Schedule 1): Sets dollar ranges for specific contravention categories, including licensing contraventions ($2,000-$20,000), financial resource contraventions ($2,000-$20,000), late filing/notification (tiered $100-$10,000 by business days late), failure to obtain required approval ($1,000-$5,000), record keeping failures ($500-$5,000), compliance system failures ($2,000-$10,000), late payment of fees/penalties ($500-$5,000 plus Schedule 2 amounts), failure to submit accurate returns ($500-$5,000), unauthorised business or failure to comply with a directive ($5,000-$60,000), and other contraventions ($100-$5,000).
• Limitation periods: The Commission cannot issue a proposed penalty notice more than 2 years after it first knew of the contravention, and cannot issue a late payment penalty notice more than 6 years after the fee, charge or penalty became due.
• No double penalty / no licence revocation on same grounds: The Commission may not impose more than one administrative penalty for the same contravention, and where it imposes an administrative penalty it cannot revoke the licence based on the same contravention (though other enforcement action remains available).

The Regulations apply generally across licensees regulated by the BVI Financial Services Commission and also extend to persons carrying on financial services business without a licence, who are treated as licensees for service-of-notice and penalty purposes.

Key obligations

• A licensee receiving a proposed penalty notice may make representations to the Commission within 21 days of the date of the notice.
• A licensee receiving a penalty notice (under Regulation 4 or 5A) must pay the stated penalty to the Commission within 14 days of receipt of the notice.
• A licensee wishing to appeal a penalty decision or amount must lodge an appeal with the Appeals Board within 14 days of receiving the penalty notice.
• Licensees must pay fees, charges and penalties by their due dates or become liable to late payment penalties calculated under Schedule 2, up to a maximum of 100% of the amount owed.
• Licensees must file documents and notify matters to the Commission by the required dates, or face late filing penalties tiered by business days late (Schedule 1, item 3).

Applies to

licensees regulated by the BVI Financial Services Commission, persons carrying on financial services business without a licence

Deadlines

• 21 days of the date of the notice: Period within which a licensee may make representations to the Commission after receiving a notice of proposed penalty.
• 14 days of receipt of the notice: Deadline for a licensee to pay a penalty stated in a penalty notice (including late payment penalty notice).
• 14 days of receiving the penalty notice: Deadline for a licensee to appeal an administrative penalty decision to the Appeals Board.
• 2 years commencing on the date the Commission first knew of the contravention: Limitation period within which the Commission must issue a proposed penalty notice for a general contravention.
• 6 years after the date the fee, charge or penalty became due: Limitation period within which the Commission must issue a penalty notice for late payment penalties.