Legal and Institutional Framework

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Legal and Institutional Framework

LEGAL

LEGAL

The judicial system forms an integral part of the legal system of the Kingdom of the Netherlands. Judges appointed by the Dutch King serve the District Court and the Joint Court of Appeals, which serves all six Dutch Caribbean islands and hears civil cases as well as criminal cases. The Charter for the Kingdom of the Netherlands, the leading legal document within the Kingdom, forms the basis for the possibility to appeal to the Supreme Court in the Netherlands. The Charter is an assurance for good governance and the preservation of human rights. Numerous offices of renowned law firms have been established in Curaçao and assure a high level of legal services for advice, setting up your business and in court proceedings. Curaçao has an independent and high-quality legal system which is based on the Dutch civil law system. Although the legal system of Curaçao is based on civil law, it also provides possibilities for common law structures like the Curaçao Trust.

Financial System

General

Curaçao has a well-developed banking system that plays a vital role in both local and international businesses on the island. Most of these banks have international links, while branches of well-known European and American banks are established in Curaçao. The highest degree of compliance with the regulatory standards. The financial services sector has been active in the support of legal and practical actions to prevent the banking system from being used for funds of criminal origin and has adopted the Statement of Principles, recommendations made by the International Committee on Banking Regulations and Supervisory Practices (The Basel Committee).

Central Bank

Curaçao and St. Maarten together have one Central Bank and one currency, the (former) Netherlands Antillean guilder. The Central Bank of Curaçao and St. Maarten (formerly the Central Bank of the Netherlands Antilles, hereafter: Central Bank) was established in 1828. The Central Bank is responsible for control and regulation of the banking and insurance businesses and trust service providers on the island. One of the most important objectives of the Central Bank is to maintain the external stability of the Antillean guilder and to take care of the efficient functioning of the financial system of the island.

High-Quality of Regulation & Supervision

Financial institutions in Curaçao operate under the supervision of the Central Bank. The supervision is executed in close cooperation with the Central Bank of The Netherlands. As a consequence, the regulatory and supervisory environment in Curaçao is comparable to those of The Netherlands. Trust service providers, fund administrators, local and international banks and insurance companies are licensed by and are under the supervision of the Central Bank. This guarantees high standards and compliance with the anti-money laundering and antiterrorist financing guidelines of the G20’s Financial Action Task Force (FATF). Curaçao has a Reporting Center where any unusual transaction which is contemplated or has taken place must be reported by anyone who provides financial services as well as specific other businesses.

The local credit institutions on the island are well equipped with trust, insurance, and investment departments that provide local and international services. The local banking sector consists of local general banks, subsidiaries of foreign banks and branches of foreign banks. In the international banking sector, a distinction can be made between consolidated and non-consolidated banks. Consolidated international banks are international credit institutions which are established in Curaçao and, through their parent company, are subject to adequate consolidated supervision by a foreign supervisory authority. The Central Bank acts as the primary supervisory authority for the non-consolidated international banks.

Curaçao forms part of the Kingdom of the Netherlands. As such, the investment protection treaties concluded by the Kingdom of the Netherlands, in general, apply to Curaçao. This means that if Curaçao is used as the home base to invest in other countries, these treaties may help to mitigate certain risks that are involved with such investments. Based on these investment treaties the business is entitled to equal protection as an investor who is a resident of the treaty partner.

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