International Banking Act

Link to law: http://www.palemene.ws/new/wp-content/uploads/01.Acts/Acts%202005/International_Banking_Act_2005_-_Eng.pdf
Published: 2005

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2005, No.8
AN ACT to provide for the Licensing and Supervision of
International Banks. [22nd
April 2005]
BE IT ENACTED by the Legislative Assembly of Samoa
in Parliament assembled as follows:-
PART I
PRELIMINARY
1. Short title and commencement-(1) This Act may be
cited as the International Banking Act 2005.
(2) This Act shall commence or any part or section
thereof on the day or days nominated by the Minister.
(3) Notice of commencement of this Act or any part or
section thereof shall be published in Samoan and English in
the Savali and one other newspaper circulating in Samoa.



66 International Banking 2005, No.8

2. Interpretation - In this Act, unless the context
otherwise requires -
“accounting records” in relation to a company includes,
whether maintained in Samoa or elsewhere, such
working papers and other documents and records
kept in a computer, on magnetic tape or by means
of any other storage device used in electronic data
processing by or on behalf of the company, as are
necessary to explain the methods and calculations
by which accounts of the company are made up;
“accounts” means profit and loss accounts and balance
sheets, and includes notes (other than directors’
reports) attached to, or intended to read with, any
of those profit and loss accounts or balance sheets;
“approved auditor” means a chartered accountant,
certified public accountant or other professionally
qualified accountant who has been approved by the
Inspector and who is a registered company auditor
under the International Companies Act 1987;
“authorised person” means any person authorised by the
Inspector pursuant to section 5(6);
“banking business” means the business of banking in all
its customary forms, branches and departments
including that of a savings bank and without limiting
the generality of the foregoing also includes-
(a) borrowing, receiving or taking up money at interest
or otherwise on current account, savings
account, deposit account or other account and
which according and subject to arrangement is
repayable on the cheque, draft, order or
authority of the customer;
(b) lending, giving credit at interest or otherwise with
or without security to any person;
(c) discounting, buying, selling and dealing in bills of
exchange, promissory notes, coupons, drafts,
bills of lading, warrants, debentures,
certificates, script, hire purchase agreements,
and other instruments and securities whether
transferable or negotiable or not;
(d) granting and issuing letters of credit and circular
notes;
(e) buying, selling and dealing in bullion and specie;


2005, No. 8 International Banking 67

(f) dealing in foreign or overseas exchange;
(g) acquiring or holding or issuing on commission,
debentures, debenture stock, bonds,
obligations, securities and investments of all
kinds;
(h) negotiating of loans and advances;
(i) becoming surety for the payment of money or
performance of contracts or obligations by any
person;
(j) receiving money and valuables on deposit or for
safe custody or otherwise;
(k) collecting and transmitting money and securities;
(l) managing property and transacting all kinds of
agency business commonly transacted by
bankers; or
(m) carrying on such other business outside the
customary scope of the business of banking as
the Minister may from time to time authorise
or approve in writing.
“Central Bank" means the Central Bank of Samoa
established pursuant to the Central Bank of Samoa
Act 1984;
“chief executive” in relation to a company, means a
person who, alone or jointly with other persons, is
responsible under the immediate authority of the
directors for the conduct of the business of the
company;
"company" means a body corporate with legal personality
recognised for most purposes as separate from that of its
members, constituted, incorporated or formed under the
laws of Samoa or in accordance with the laws of any other
country or place, including public and private
corporations;
“controller” in relation to a company means:
(a) a managing director or chief executive of that
company or of any other company of which
that company is a subsidiary; or
(b) a shareholder controller or an indirect controller;
“Court” means the Supreme Court of Samoa;


68 International Banking 2005, No.8

“director” means any person occupying the position of
director (by whatever name called) of a company
and includes any person in accordance with whose
directions and instructions the directors of a
company are accustomed to act or who has been
held out by a company to be a director;
"dollar" means a unit of the currency of the United States
of America;
“domestic banking business” means banking business
transacted by, for, and in respect of residents of
Samoa, but does not include any company
incorporated or registered under the International
Companies Act 1987, any trustee company
registered under the Trustee Companies Act 1987,
any international trust registered under the
International Trusts Act 1987, any international
partnership or limited partnership registered under
the International Partnership and Limited Partnership
Act 1998 or any segregated fund international
company registered under the Segregated Fund
International Companies Act 2000;
“financial interest” means an investment in the equity,
ownership or control of a company;
“fit and proper” has the meaning given in section 3;
"holder" means, in relation to a licence, the person to
whom it was issued;
“indirect controller” in relation to a company, means a
person in accordance with whose directions or
instructions any director of that company or of any
other body corporate of which that company is a
subsidiary, or any controller of that company is
accustomed to act;
“Inspector” means the Inspector of International Banks
appointed under section 5 and includes any person
acting under the Inspector’s authority;
“international banking business” means any banking
business conducted in any currency, including the
currency of Samoa, transacted by, for or in respect of
non-residents and with the approval granted pursuant
to section 12, can include domestic banking
business;
“Judge” means a Judge of the Supreme Court of Samoa;


2005, No. 8 International Banking 69

"licence" means a licence granted pursuant to Part II of
this Act;
“licensee" means any company holding a current valid
licence pursuant to the provisions of this Act;
“manager” in relation to a company means a person other
than a chief executive who, under the immediate
authority of a director or chief executive of the
company -
(a) exercises managerial functions; or
(b) is responsible for maintaining accounts or other
records of the company;
"Minister" means the Minister of Finance;
“Money Laundering Authority” means the Money
Laundering Authority appointed under the Money
Laundering Prevention Act 2000;
"non-resident" means a person not ordinarily resident in
and not domiciled in Samoa who does not engage in
a trade or business in Samoa, and includes any
company incorporated or registered under the
International Companies Act 1987, any trustee
company registered under the Trustee Companies
Act 1987, any international trust registered under the
International Trusts Act 1987, any international
partnership or limited partnership registered under
the International Partnership and Limited Partnership
Act 1998 or any segregated fund international
company registered under the Segregated Fund
International Companies Act 2000;
“officer” in relation to a licensee includes any director,
secretary or employee of the licensee;
“person” has the same meaning as provided in section 2
of the International Companies Act 1987;
"residence" means ordinary residence or usual place of
abode and the words "to reside" or
"resident" shall have corresponding meanings;
“shareholder controller” in relation to a company means
a person who, alone or with associates, is entitled to
exercise or control the exercise of 10 per cent or
more of the voting power in general meeting of that
company or of any other body corporate of which
that company is a subsidiary;
"this Act" includes regulations made under this Act.


70 International Banking 2005, No.8

3. Meaning of “fit and proper” - For the purposes of this
Act, in determining whether a person is a “fit and proper”
person, regard shall be had to all circumstances, including that
person’s -
(a) honesty, integrity and reputation;
(b) competence and capability; and
(c) financial soundness.

PART II
LICENSING OF INTERNATIONAL BANKS

4. Unlicensed international banking prohibited-(1) No
person shall transact any international banking business from
within Samoa, whether or not such business is carried on in
Samoa, unless the person is the holder of a valid international
banking licence issued under this Part.
(2) Every person commits an offence against this Act
who, not being duly licensed under this Part -
(a) acts as an international bank, whether on the
person’s own account, in partnership or
otherwise;
(b) holds themselves out as being licensed or otherwise
entitled to act as an international bank;
(c) takes or uses any name, title, addition, or
description implying or likely to lead any
person to believe that the person is licensed or
otherwise entitled to act as an international
bank; or
(d) carries on business as an international bank’s agent,
or in any way advertises or holds themselves
out as an international bank’s agent.
(3) In any proceedings in respect of an offence under this
section, the following shall, in the absence of proof to the
contrary, be sufficient evidence of the matters contained
therein -
(a) a certificate signed by the Minister to the effect
that at the time of the alleged offence the
defendant was not the holder of a valid
international banking licence; and
(b) a certificate signed by the Minister to the effect that
the defendant was at the time of the alleged
offence acting as an international bank, or
holding themselves out in such capacity.


2005, No. 8 International Banking 71

(4) Any person convicted of an offence under this section
shall be liable to imprisonment for a term not exceeding 2
years or to a fine not exceeding 50,000 dollars or to both.
5. Inspector of International Banks-(1) The Inspector
of International Banks shall be appointed by the Minister for
the regulation and supervision of licensees.
(2) There shall be appointed by the Minister from time to
time such Deputy Inspectors as are required for the purposes
of this Act.
(3) Subject to the control of the Inspector, a Deputy
Inspector has and may exercise the powers, duties and
functions of the Inspector under this or any other Act.
(4) It is the duty of the Inspector -
(a) to maintain a general review of international
banking practice in Samoa, including the
maintenance of adequate policies and
procedures for “know your customer” and
anti-money laundering;
(b) whenever the Inspector thinks fit to conduct on-
site examinations and off-site supervision, by
way of the receipt of regular returns or in such
other manner as the Inspector thinks necessary,
of the affairs or business of any licensee for the
purpose of satisfying the Inspector that the
provisions of this Act are being complied with
and that the licensee is in a sound financial
position and whenever the Inspector thinks fit
to report to the Minister the results of every
such examination;
(c) to assist in the investigation of any offence
against the laws of Samoa which the
Inspector has reasonable grounds to believe
has or may have been committed by a
licensee or by any of its directors or officers
in their capacity as such;
(d) to examine audited annual accounts, statements
and returns forwarded to the Inspector under
sections 27 and 28 and to report on them to
the Minister whenever the Inspector thinks
fit; and


72 International Banking 2005, No.8

(e) to examine and make recommendations to the
Minister with respect to applications for
licences or licence renewals.
(5) In the performance of the Inspector’s functions under
this Act and, subject to section 37, the Inspector is entitled at
all reasonable times -
(a) to have access to such accounts, accounting
records, books, records, vouchers,
documents, cash and securities of any
licensee;
(b) to request any information, matter or thing from
any person who the Inspector has reasonable
grounds to believe is carrying on international
banking business in contravention of section 4;
(c) to call upon any officer of the licensee for such
information and explanation;
(d) to call upon the auditors of any licensee for such
auditor’s reports, working papers, information
or explanation;
(e) to require that the auditor of a bank report to the
Inspector on the extent of the procedures of the
auditor in the examination of the annual
financial statements and may require that the
auditors enlarge the scope of that examination
or direct that any other particular procedure be
performed in any particular case; or
(f) to require that the auditor make a particular
examination relating to the adequacy of the
procedures adopted by the bank for the safety
of its creditors and shareholders, or any other
examination as considered necessary by the
Inspector,
as the Inspector may reasonably require for the purpose of
enabling the Inspector to perform the Inspector’s functions
under this Act;
(6) The Inspector, with the approval of the Minister, may
in writing authorise any other person to assist the Inspector
in the performance of the Inspector’s functions under this
Act.





2005, No. 8 International Banking 73

(7) If it appears to the Inspector that there are reasonable
grounds for suspecting that an offence against this Act has
been or is being committed by any person the Inspector may
take such action as the Inspector considers necessary in the
interests of the depositors or other creditors of the licensee
concerned to preserve any assets held by that licensee.
(8) Any person who fails to comply with any
requirement under subsection (5) by the Inspector or any
authorised person commits an offence.

6. Regulatory codes-(1) The Minister may by notice in
writing make codes (in this Act referred to as “regulatory
codes”) concerning -
(a) the conduct of any business carried on by
international banks;
(b) the financial resources of international banks;
(c) the assets, liabilities and other matters to be taken
into account in determining an international
bank’s financial resources for the purposes of
the code;
(d) arrangements for the settlement of disputes;
(e) the keeping of accounts and other records, their
form, content, inspection and audit;
(f) the form and content of advertisements in respect
of any business carried on by international
banks;
(g) the giving of notice to the Minister or the
Inspector of the occurrence of such events as
may be specified in the code;
(h) the form and content of any information required
to be produced by international banks to the
Minister or the Inspector;
(i) the financial statements and returns which are to be
submitted to the Minister or the Inspector; and
(j) the display of notices and the provision of
information about the affairs of international
banks to the public at its offices and places of
business,
which shall apply to international banks.
(2) A regulatory code may include a requirement that the
licensee to whom it applies shall comply with such rules,
regulations, codes or standards as are from time to time in
force and made or issued by the Minister.



74 International Banking 2005, No.8

7. Directions-(1) The Inspector may from time to time
issue by notice to all licensees directions in relation to the
implementation of the provisions of this Act.
(2) Failure by any licensee to comply with such
directions shall be taken into consideration when any action
is proposed to be taken under section 44.

8. Licences-(1) Every person who desires to obtain a
licence under this Act shall make application to the Minister in
the prescribed form.
(2) The following kinds of licences may be granted under
this Act, namely-
(a) “A” class international banking licences;
(b) “B1” class international banking licences; and
(c) “B2” class international banking licences.
(3) Except as otherwise specially provided herein, or in
any other Act, no person other than a company shall be
eligible to hold a licence under this Act.

9. "A" class international banking licence-(1) No
company shall apply for or obtain or be eligible to hold an "A"
class international banking licence under this Act unless it has
at all relevant times an aggregate of unimpaired capital issued
and paid up in cash and reserves of not less than 10 million
dollars or an equivalent amount in a currency approved by the
Minister.
(2) An "A" class international banking licence shall
license the holder to transact international banking business
through its business office in Samoa.
(3) An "A" class international banking licence shall,
subject to this Act and payment of the prescribed annual
licence fee, be valid until cancelled or surrendered pursuant
to sections 44 and 46.

10. "B1" and “B2”class international banking licences
-(1) A "B1" class international banking licence shall, where
the holder has at all relevant times an aggregate of unimpaired
capital issued and paid up in cash and reserves of not less than
2 million dollars or an equivalent amount in a currency
approved by the Minister, license the holder to -
(a) transact only such international banking business
as may be specified in the licence through its
business office in Samoa; and



2005, No. 8 International Banking 75

(b) transact such specified business only in the
currency or currencies specified in the licence.
(2) A“B2” class licence shall, where the holder has at all
relevant times an aggregate of its capital issued and paid up in
cash and unimpaired reserves of not less than 250,000 dollars
or an equivalent amount in a convertible currency approved by
the Minister -
(a) prohibit the holder from soliciting or accepting any
deposits of money or any other valuable thing
from the general public;
(b) licence the holder to accept deposits of money or
any other valuable thing only from those
persons or entities whose names are listed in
the undertaking accompanying the licence
application or application for renewal of a
licence under section 16;
(c) prohibit the holder from issuing to any depositor a
cheque book, or providing any cheque account
facilities for the transaction of the depositor’s
international banking business;
(d) license the holder to transact only such inter-
national banking business as may be specified
in the licence through its business office in
Samoa; and
(e) license the holder to transact such specified
business only in the currency or currencies
specified in the licence.
(3) A "B1" or “B2” class international banking licence
shall, subject to this Act, be valid for a period of 1 year from
the date of granting and may be renewed for further periods of
1 year each.
(4) Any licensee, whose “B2” class licence is deemed to
continue in effect pursuant to section 60, shall, within one
month of the commencement date or such further period as the
Inspector may allow, file with the Inspector the undertaking as
to acceptance of deposits, referred to in subsection (2)(b).
(5) Every person who fails to comply with the provisions
of subsection (4) commits an offence and is liable on
conviction to a fine not exceeding 1,000 dollars for every day
during which the offence continues.

11. Physical presence in Samoa-(1) All licensees are
required as a condition of their licence to establish and
maintain a physical presence in Samoa.


76 International Banking 2005, No.8

(2) For the purposes of subsection (1) -
“physical presence” means a place of business maintained
by the international bank and located at a fixed
address, other than a post office box or electronic
address in Samoa and at which location the bank -
(a) employs one or more individuals full-time; and
(b) maintains operations and banking related records.
(3) Notwithstanding subsection (1), any licensee, whose
licence is deemed to continue in effect pursuant to section 60,
shall be allowed a period of 270 days from the
commencement of this Act to comply with the provisions of
this section.
(4) The Inspector may, in the Inspector’s absolute
discretion, and upon sufficient cause being shown, extend the
period of time referred to in subsection (3) for a further period
of up to a maximum of 270 days.

12. Approval to carry on domestic banking business-
(1) A licensee may, at any time during the term of its
licence, apply to the Minister for permission to transact
domestic banking business by, for and in respect of residents
of Samoa.
(2) In determining whether to grant permission in respect
of an application made under subsection (1), the Minister
shall have regard to the public interest, the advice of Central
Bank and such other considerations as the Minister thinks fit
to take into account.
(3) The Minister, on being satisfied that permission
should be granted in accordance with subsection (2), may
grant permission upon such terms and conditions as the
Minister thinks fit.
(4) No decision made by the Minister under this section
shall be reviewed or questioned in any Court by way of
appeal, prerogative writ or otherwise howsoever.


2005, No. 8 International Banking 77

(5) The provisions of this section shall have effect
notwithstanding any restrictions to the contrary in this Act,
the International Companies Act 1987 or any other
enactment.

13. Application for licence-(1) Every application for a
licence under this Act shall be submitted to the Inspector and
shall be accompanied by -
(a) a certified copy of the Act, charter, memorandum
of association and articles of association of the
company, or other document or documents by
which the company is constituted;
(b) the prescribed fee;
(c) evidence, in such form as the Minister or the
Inspector shall specify, verifying -
(i) that the laws of the jurisdiction under
which the company is incorporated have been
complied with;
(ii) the nature and character of the
company’s business and proposed business;
(iii) the financial standing of the
company;
(iv) the ultimate beneficial ownership of
the company; and
(v) that every person who is or is to be a
director, controller or manager of the
company is a fit and proper person to hold
that position;
(d) such references as the Minister or Inspector may
require; and
(e) notice of an address for service within Samoa.
(2) In addition to the documents, information, and
evidence which shall accompany an application under
subsection (1), an applicant shall, if required to do so by the
Minister or the Inspector, furnish to the Inspector such
additional documents, information or evidence as the Minister
or the Inspector may require.

14. Minister may grant or refuse licence-(1) Where an
application for a licence is made, the Minister may, after due
consideration of that application and at the Minister discretion,
either grant a licence or reject the application.
(2) In making a decision under subsections (1), (3) and (4)
the Minister shall have regard to the public interest.


78 International Banking 2005, No.8

(3) Where the Minister grants a licence the Minister may
do so subject to such terms and conditions, if any, as the
Minister thinks fit.
(4) If terms and conditions are imposed under subsection
(3) the Minister may, from time to time, vary or revoke any of
those terms or conditions or impose any additional terms or
conditions.
(5) The Minister need not give reasons for any decision or
direction made under this section.
(6) No decision or direction made by the Minister under
this section shall be reviewed or questioned in any Court by
way of appeal, prerogative writ or otherwise howsoever.
(7) An applicant for a licence shall have no right or
entitlement to the granting of a licence under this Act.

15. Licence fees-(1) Where an application for a licence is
refused, any application and licence fees shall be totally non-
refundable.
(2) In any case where a prescribed annual fee has not been
paid by the licensee by the due date and the licensee continues
to transact international banking business, the amount shall be
recoverable together with the prescribed penalty in any Court
of competent jurisdiction as a debt due to the Government.
(3) Every licensee who makes default in paying a
prescribed annual fee imposed upon the licensee in respect of
a licence under this Act by the due date and the licensee
continues to transact international banking business, commits
an offence for which the licensee is liable upon conviction to a
fine not exceeding an amount equal to treble the amount of the
unpaid fee.

16. Licence renewal-(1) Subject to this section, an
application by a licensee for renewal of a licence granted
under section 10 must be received by the Inspector not later
than two months prior to the expiration of the said licence.
(2) An application for a renewal of a licence shall be in the
prescribed form submitted to the Inspector and accompanied
by -
(a) particulars of any material changes or alterations in
the particulars submitted pursuant to
subsections (1) and (2) of section 13 which
have taken place since the grant of the licence;
(b) in the case of B2 class licensees, the undertaking
as to depositor acceptance;


2005, No. 8 International Banking 79

(c) such other additional documents, information or
evidence as the Minister or the Inspector may
require; and
(d) the prescribed annual licence fee, any penalty
fees and any late fee.
(3) Where an application for renewal of a licence is made
pursuant to subsection (1) the Minister may, after due
consideration of that application and at the Minister’s
discretion, either grant the renewal subject to such terms and
conditions, if any, as the Minister thinks fit or refuse the
application.
(4) If terms and conditions are imposed under subsection
(3), the Minister may, from time to time, vary or revoke any of
those terms or conditions or impose additional terms or
conditions.
(5) Where an application to renew a licence is made after
the time specified in subsection (1) and the licence has not
expired or has not been cancelled or revoked, the licence may
be renewed pursuant to this section, subject to payment of
such penalty as may be prescribed.
(6) Subject to section 47, a licensee shall have no right or
entitlement to renewal of a licence.

17. Transfer of a licence-(1) In this section "transfer of
control" in relation to a licensee, shall include-
(a) the sale, transfer or other disposition whatsoever of
the shares in the capital of the company, or any
issue or allotment of any new shares in the
capital of the company or the happening of any
other matter or event whatsoever, the effect of
which is to transfer directly or indirectly the
effective ownership, management and control
of the company; and
(b) any of the events referred to in paragraph (a)
occurring to any holding company of the
licensee or any holding company of any
holding company of the licensee.
(2) Subject to subsection (3), a licensee shall not transfer
the licence or assign any interest therein and any such
purported transfer or assignment shall be void and of no effect.
(3) A licensee shall not transfer control of the holder of
the licence without prior written approval of the Minister.


80 International Banking 2005, No.8

(4) A licensee shall have no right or entitlement to transfer
a licence.
18. Shares not to be issued or transferred without
approval-(1) Subject to this section, shares in or other
securities whatsoever of a licensee shall be issued and no
issued shares or beneficial interest in shares or other
securities of any licensee shall be transferred or disposed of
in any manner without the prior written approval of the
Inspector.
(2) In subsection (1) the reference to shares of any
licensee being transferred or disposed of includes any
transfer or disposition that would result in any change in
beneficial ownership or control of the licensee.
(3) Notwithstanding the provisions of subsection (1) the
prior written approval of the Inspector shall not be required
where shares or other securities are issued to existing
shareholders on a pro-rata basis.
(4)No bearer shares or share warrants to bearer shall be
issued by a licensee.
19. Appointment and Approval of directors and chief
executive-(1) A licensee shall at no time have less than two
directors who effectively direct the business and who shall be
natural persons.
(2) At least one of the directors of a licensee shall be a
resident of Samoa.
(3) A licensee shall, before the appointment of a director
or chief executive, apply to the Inspector for the Inspector’s
written approval of such appointment as a fit and proper
director or chief executive of the licensee.
(4) Approval granted under subsection (3) -
(a) automatically lapses if the director or chief
executive becomes bankrupt or makes an
arrangement or composition with creditors or
is convicted of an offence involving
dishonesty; and
(b) may be revoked by the Inspector.
(5) Notwithstanding subsections (1) and (2), any
licensee, whose licence is deemed to continue in effect
pursuant to section 60, shall be allowed a period of 270 days
from the commencement date of this Act to comply with
those provisions.



2005, No. 8 International Banking 81

(6) The Inspector may, in the Inspector’s absolute
discretion, and upon sufficient cause being shown extend the
period of time referred to in subsection (5) for a further
period not exceeding 270 days.

20. Disqualification to be employed by licensee-(1)
Subject to subsection (2), no person shall apply for or obtain
employment, or be eligible to be employed as a director,
manager, company secretary or employee of any licensee
under this Act, without the express prior approval in writing of
the Inspector if the person -
(a) has been a director of or directly or indirectly
concerned in the management of a licensee
that has had its licence cancelled in
accordance with section 44 or has been
wound up by a Court;
(b) has been sentenced by a Court in any country to a
term of imprisonment for an offence
involving dishonesty and has not received a
full pardon for that offence;
(c) is or becomes bankrupt or suspends payment to or
compounds with the person’s creditors; or
(d) has been a director of a company that has gone
into bankruptcy or insolvency proceedings
other than voluntary winding up proceedings,
Provided that the approval of the Inspector shall be granted
only in exceptional cases where it would not be contrary to
the public interest and the said person would otherwise be
considered a fit and proper person to hold that position.
(2) Nothing in this section shall prejudice, limit or
restrict the powers of the Inspector under section 19(3) in
approving the appointment of a director or chief executive of
a licensee.
(3) Every person who acts in contravention of the
provisions of subsection (1) commits an offence and is liable
on conviction to a fine not exceeding 5,000 dollars.
(4) Sufficient evidence of a previous conviction, for the
purposes of proceedings under subsection (3), may be given-
(a) by the production of the original judgement of
conviction purporting to be signed by the
judge or sealed by the Court who made or
issued it without evidence of such signature
having been made or of such seal having


82 International Banking 2005, No.8

been impressed or any other evidence relating
thereto; or
(b) by the production of a written copy or extract of
the judgement or conviction purporting to be
certified by an official of the Court who made
or issued the copy or extract without evidence
of such certificate having been made or any
other evidence relating thereto.
(5) Sufficient evidence of the absence of a full pardon,
for the purposes of proceedings under subsection (3), may
be given by certificate by an official of the Court in which
the conviction or judgement was issued stipulating that no
appeal is outstanding and that no pardon has been entered in
the records of the Court Registry in respect of the conviction
or judgement.

21. Certain approvals required-(1) A licensee shall
not, without the prior written approval of the Minister or the
Inspector -
(a) open outside Samoa a subsidiary bank, branch
office, agency or representative office; or
(b) change its name.
(2) A licensee, licensed as an “A” class international
bank under Section 9 or licensed as a “B1” class
international bank pursuant to section 10(1) shall not,
without the prior written approval of the Inspector, acquire
or hold in any one or more companies any financial interest
exceeding in value in the aggregate fifteen per cent of the
paid up capital and reserves of the licensee.

22. Insurance policy - The Minister or the Inspector may
require a licensee to effect a policy of insurance with an
approved insurance company against -
(a) the dishonesty of employees of the licensee;
(b) loss of documents; and
(c) such other risks as the Minister may stipulate,
in such amount and of such nature as the Minister or the
Inspector determine to be fit and proper, having due regard
to the nature and type of business carried on by the licensee;
and in the event that the insurance is withdrawn, cancelled
or not renewed, the licensee shall immediately notify the
Inspector and shall cease to carry on its business until the
insurance has been reinstated or replaced.


2005, No. 8 International Banking 83

23. Prohibited activities-(1) A licensee shall not -
(a) hold a licence or operate under a name or use a
name which -
(i) so closely resembles or is identical to
the name of any company, firm, business
house or other financial entity or institution,
whether within Samoa or elsewhere as is likely
to mislead or deceive;
(ii) is calculated to suggest falsely the
patronage of or connection with some person
or authority whether within Samoa or
elsewhere; or
(iii) is calculated to suggest falsely that
such licensee has a special status in relation to
or derived from the Government of Samoa or
has the official backing of or acts on behalf of
the said Government or of any Ministry or
agency or official thereof or is recognised in
Samoa as a national or central bank;
(b) use or trade under any name other than the name
under which it is licensed under this Act;
(c) transact any banking business with residents of
Samoa, unless authorised pursuant to section
12; or
(d) transact any business otherwise than in accordance
with the terms and conditions of its licence and
this Act.
(2) A holder of an “A” class international banking licence
or a "B1" class international banking licence shall not -
(a) grant any advance or credit facility against the
security of its own shares;
(b) accept any deposit of money or any other valuable
thing less than the amount which shall from
time to time be specified in the licence;
(c) grant or permit to be outstanding unsecured
advances or unsecured credit facilities of an
aggregate amount in excess of 5,000 dollars or
of one percent of the sum of the paid up capital
and unimpaired reserves of such licensee,
whichever is the greater, or give any financial
guarantees in excess of such amount without
proper security, or incur any other liability in
excess of such amount without proper security-


84 International Banking 2005, No.8

(i) to or on behalf of any of its controllers,
directors, shareholders, beneficial shareholders
or beneficial owners, whether such advances,
facilities, guarantees or other liabilities are
obtained by or on account of such person
jointly or severally; or
(ii) to or on behalf of any firm, partner-
ship or company in which the licensee, or any
one or more of its controllers, directors,
shareholders, beneficial shareholders or
beneficial owners, is interested as a controller,
director, partner, manager, agent, shareholder,
beneficial shareholder or beneficial owner or to
or on behalf of any individual firm, partnership
or company of whom or of which any of the
licensee’s controllers, directors, shareholders
or beneficial shareholders or beneficial owners
is a guarantor; and
(iii) for the purposes of this paragraph, a
controller, director, shareholder, beneficial
shareholder and beneficial owner shall include
the wife, husband, de facto partner, father,
mother, brother, sister, son or daughter of such
a person;
(d) acquire or hold in any company any financial
interest exceeding in value in the aggregate
sixty per cent of the paid up share capital and
reserves of the licensee; or
(e) acquire or hold any interest in any property,
chattels or real estate for any purpose other
than the carrying on of its international
banking business.
(3) Every person who acts in contravention of this section
commits an offence and is liable on conviction to a fine not
exceeding 1,000 dollars for each day during which the offence
continues.

24. Name to contain word "bank" - Every licensee shall
use as part of its description or title the word "bank" or one or
more of its derivatives in any language.


2005, No. 8 International Banking 85

25. Notification of changes-(1) Notwithstanding the
provisions of any other Act, a licensee incorporated outside
Samoa or with its head office situated outside Samoa shall,
within one month after the making of an alteration in the act,
charter, memorandum of association, articles of association or
other document by which the licensee was constituted a
company, furnish to the Inspector particulars in writing of the
alteration verified by a statutory declaration made by a senior
officer of the company authorised to do so.
(2) A licensee shall forthwith notify the Inspector, in
writing, of any material change in the particulars set out in the
application for issue or renewal of a licence or in the
documents, information, or evidence accompanying that
application or in any documents, information, or evidence, if
any, given under sections 13 or 16.
(3) Where a reconstruction of the licensee has occurred or
where the licensee makes an arrangement or enters into an
agreement for -
(a) the sale or other disposal of its business by
amalgamation or otherwise; or
(b) the purchase or other acquisition of the business of
any other licensee,
such licensee shall forthwith, upon the occurrence of the
said reconstruction or upon the making or entering into of
the said arrangement or agreement, inform the Inspector in
writing thereof.
(4) Where any particulars or information is received under
this section, the Minister, having regard to the nature of such
particulars or information and notwithstanding the fact that the
company concerned is a licensee, may direct the company, in
writing, to apply for another licence within such time and in
such form as the Minister may determine.
(5) The issue of a directive pursuant to subsection (4) shall
not affect the validity of any licence subsisting at the date of
such directive and which was granted to the company to which
the said directive is issued.
(6) Every licence to which subsection (5) refers shall be
of full force and effect until -
(a) it is cancelled by the Minister by order under
section 44; or


86 International Banking 2005, No.8

(b) another licence is granted to the company
concerned upon an application made pursuant
to a directive under subsection (4), and
thereafter the licence referred to in subsection
(5) shall cease to have effect.
(7) Every person who fails to comply with any of the
provisions of subsections (1), (2) or (3) or with any
requirement of the Minister under subsection (4) commits an
offence and is liable on conviction to a fine not exceeding
1,000 dollars for every day during which the offence
continues.

PART III
ACCOUNTING RECORDS,
BUSINESS INSPECTIONS AND AUDITS

26. Keeping of accounting records-(1) A licensee shall -
(a) keep such accounting records as correctly record
and explain the international banking
transactions and financial position of the
company in relation to such business and
maintain such accounting records at a location
in Samoa notified to the Inspector;
(b) keep its accounting records in such a manner as
will enable true and fair accounts of the
international banking business of the company
to be prepared from time to time; and
(c) keep its international banking business records in
such a manner as will enable the accounts of
the company to be conveniently and properly
audited.

27. Annual report and audit - A licensee shall submit
to the Inspector -
(a) within 6 months of the end of its financial year,
accounts duly audited pursuant to the
provisions of section 35; and
(b) an Annual Report, in such form as the Inspector
may from time to time approve, by December
31 of each year.


2005, No. 8 International Banking 87

28. Quarterly statements and other returns-(1) Subject
to subsection (3), every licensee shall, in relation to its
operations in or from within Samoa, submit to the Inspector,
in such form as the Inspector may from time to time approve,
the following statements-
(a) in the case of holders of an “A” class banking
licence or of a “B1” class banking licence,
not later than 21 days after the last day of the
quarter to which it relates a quarterly
statement of assets and liabilities, cash flow
statement, profit and loss statement and a
return providing an analysis of customer
liabilities to the licensee in respect of loans,
advances and other assets of the licensee at
the close of the last business day of that
quarter;
(b) in the case of holders of a “B2” class banking
licence, not later than 21 days after the six
month period to which it relates a half-yearly
statement of assets and liabilities, cash flow
statement, profit and loss statement and a
return providing an analysis of customer
liabilities to the licensee in respect of loans,
advances and other assets of the licensee at
the close of the last business day of that half-
yearly period; and
(c) such other returns as may be prescribed in the
regulatory code issued pursuant to section 6;
(2) Subject to subsection (3), the Inspector may require a
licensee to submit to the Inspector such further information as
may be necessary for the proper understanding of any
statement or return furnished by that licensee under subsection
(1) above and such information shall be submitted within such
period and in such manner as the Inspector may require.
(3) The Inspector may extend the period within which any
statement or return is required to be submitted under this
section where the Inspector considers that there are
circumstances justifying an extension.
(4) Every licensee which fails to comply with any of the
provisions of subsection (1) or subsection (2), or with any
requirement of the Inspector thereunder, commits an offence
and is liable on conviction to a fine not exceeding 1,000
dollars for every day during which the offence continues.


88 International Banking 2005, No.8

29. Inspection-(1) The Inspector shall during the normal
office hours of the licensee, at the registered office of the
licensee or principal office of the licensee, have the right to
inspect -
(a) the licensee’s accounting records;
(b) the licensee’s register of shares;
(c) the licensee’s record of transactions;
(d) any other record kept by the licensee in the course
of its international banking business; and
(e) the premises where the licensee carries on its
international banking business.
(2) In exercising the right of inspection pursuant to
subsection (1), the Inspector shall have a reasonable belief that
the action is required to carry out the Inspector’s functions
under this Act or as part of a regular on-site inspection of the
licensee.

30. Supply of information-(1) A licensee shall furnish to
the Inspector such information in respect of its international
banking business or any other matter as the Minister or the
Inspector may from time to time direct.
(2) In exercising the right to request information
pursuant to subsection (1), the Inspector or the Minister shall
have a reasonable belief that the action is required to carry
out their functions under this Act or as part of a regular on-
site inspection of the licensee.

31. Central Bank controls - A licensee or its auditor shall
furnish to the Central Bank such information regarding its
domestic banking business as the Central Bank may from time
to time direct.

32. Power of search-(1) A Judge or Registrar of the
Supreme Court who is satisfied by information on oath of
the Inspector or authorised person that -
(a) there is reasonable ground for suspecting that an
offence against this Act has been or is being
committed and that evidence of the
commission of the offence is to be found at
any premises, building or place or in any
vehicle, vessel or aircraft so specified; or


2005, No. 8 International Banking 89

(b) any books, records, vouchers, documents, cash
or securities, that ought to have been
produced under sections 5, 29 or 30 and have
not been produced, are to be found at any
such premises, building or place or in any
such vehicle, vessel or aircraft,
may grant a search warrant authorising the Inspector or
authorised person named in the warrant at any time within
one month from the date of the warrant, to enter the
premises or building or place specified in the warrant or, as
the case may be, any premises upon which the vehicle,
vessel or aircraft so specified may be and to search such
premises, building or place or, as the case may be, such
vehicle, vessel or aircraft.
(2) The person authorised by any such warrant to search
any premises or building or place or any vehicle, vessel or
aircraft may search every person who is found in or whom the
authorised person has reasonable grounds to believe to have
recently left or to be about to enter those premises or building
or place or that vehicle, vessel or aircraft, as the case may be,
and may seize any books, records, vouchers, documents, cash
or securities found in the possession of any such person or in
such premises or building or place or in such vehicle, vessel or
aircraft which the person has reasonable grounds for believing
ought to have been produced under sections 5, 29 or 30.
(3) Where by virtue of this section a person has any
power to enter any premises or building or place or a
vehicle, vessel or aircraft, the person and any police or other
person assisting may use such force as is reasonably
necessary for the purpose of exercising that power.
(4) Every search warrant shall be exercised by day,
unless the warrant expressly authorises the execution thereof
by night.
(5) It is the duty of everyone executing any search
warrant to have it with them and to produce it if required to
do so.
(6) Whosoever obstructs the Inspector or any other
person in the exercise of any powers conferred on the
Inspector under this section commits an offence.
(7) The Commissioner of Police shall provide the
Inspector or authorised person with such assistance as the
Inspector or authorised person requests concerning the
exercise of the Inspector’s or authorised person’s powers
under this section.


90 International Banking 2005, No.8

33. False or misleading information - Any licensee or
any director or officer of a licensee who knowingly or
willfully supplies false or misleading information to the
Minister or the Inspector or any authorised person commits an
offence.

34. Official examinations-(1) The Minister may, at the
Minister’s discretion from time to time, appoint one or more
qualified persons to make examinations, under conditions of
confidentiality, of the books and affairs of any licensee.
(2) The Minister may, at any time, appoint one or more
qualified persons to make a special examination, under
conditions of confidentiality, of the books and affairs of any
licensee -
(a) where the Minister has reason to believe that such
licensee may be carrying on its business in a
manner detrimental to the interest of its
depositors and other creditors or may have
insufficient assets to cover its liabilities to the
public or may be, either in Samoa or
elsewhere, contravening any of the provisions
of the Act; or
(b) if the licensee suspends payment or informs the
Minister of its intention to do so.
(3) Every licensee, of which an examination has been
ordered under subsections (1) or (2), shall produce to the
person or persons appointed at such times and in such places
as such person or persons may specify (being times and places
which, in the opinion of such person or persons, would not be
unreasonably detrimental to the conduct of the normal daily
business of the licensee) all books, accounts and documents in
the possession or custody of such licensee or of which it is
entitled to possession or custody relating to its business, and
shall give, within such times as such person or persons may
specify, such oral information concerning the licensee's
business as may be required.
(4) As soon as may be practicable after the conclusion of
an examination under this section, the person or persons
appointed to carry out the examination shall submit a full
report on such examination to the Minister who may forward a
copy thereof to the head office of the licensee concerned and,
depending upon the contents of the report, may take such


2005, No. 8 International Banking 91

action as the Minister deems fit under the provisions of the
Act or other laws of Samoa.
(5) The Minister may order that all expenses of and
incidental to an examination under this section shall be paid
by the licensee examined.
(6) Every person commits an offence and is liable on
conviction to a fine not exceeding 1,000 dollars for every day
on which the offence has continued who-
(a) refuses or fails or neglects to produce any book,
account, document or information required
under subsection (3); or
(b) knowingly produces any book, account, document
or information required under subsection (3)
which is false or misleading in any material
particular.

35. Annual audit-(1) Every licensee shall appoint
annually an approved auditor whose duties shall be to make to
the shareholders of that licensee a report upon the annual
balance sheet and accounts, and in every such report the
auditor shall state whether, in the auditor’s opinion, proper
books of account have been kept and where applicable proper
returns adequate for the audit have been received from
branches not visited by the auditor, whether the balance sheet
and accounts are in agreement with the company's books, and
whether the balance sheet is full and fair and properly drawn
up and whether it exhibits a true and fair statement of the
licensee's affairs, and, in any case in which the auditor has
called for explanation or information from the officers or
agents of the licensee, whether this is satisfactory and the said
audit shall be prepared in accordance with internationally
accepted accounting standards.
(2) In addition, the auditor shall report upon whether the
licensee is carrying on business in accordance with the terms
of its licence in so far as those terms relate to financial
and/or accounting matters and shall include verification of
compliance with the undertaking given by a licensee under
section 10(2)(b).
(3) The auditor shall also report whether, in the auditor’s
opinion, the quarterly or half-yearly returns filed by the
licensee have been completed correctly in accordance with the
reporting instructions and accurately reflect the management
accounts as prepared by the licensee.


92 International Banking 2005, No.8

(4) The report of an approved auditor under subsection (1)
shall be read together with the report of the directors of the
licensee at the annual meeting of shareholders and copies of
that report shall be sent to the Inspector, together with copies
of the balance sheet and profit and loss account, and if any
default is made in complying with the requirements of this
subsection, the licensee concerned commits an offence and is
liable on conviction to a fine not exceeding 5,000 dollars.
(5) If a licensee fails to appoint an approved auditor under
subsection (1) or, at any time, fails to fill a vacancy for such
auditor the Inspector may appoint an approved auditor and
shall fix the remuneration to be paid by that licensee to such
auditor.
(6) The duties and powers conferred on examiners
appointed under section 34(3) are hereby conferred also in
relation to approved auditors.
(7) No person having an interest in any licensee, otherwise
than as a depositor, and no director, officer or agent of any
licensee shall be eligible for appointment as an approved
auditor for that licensee; and any person appointed as such
auditor to any licensee who subsequently acquires such
interest or becomes a director, officer or agent of that licensee
shall cease to be such auditor.
(8) Where, in the case of a licensee incorporated outside
Samoa, the auditor is satisfied that a report upon the annual
balance sheet and accounts of such licensee has been duly
made by an auditor in accordance with the law of the country
in which such licensee is incorporated, and a copy of such
report, together with the report of the directors of such
licensee, is sent to the Inspector, the Inspector may by notice
in writing exempt any such licensee from the provisions of
this section.

36. Duties of auditor-(1) In carrying out an audit of the
accounts of a licensee, it shall be the duty of the auditor, where
necessary, to enlarge or extend the scope of the audit of the
business and affairs of the licensee and to carry out any other
examination or establish any procedure so as to give a true and
fair view of the licensee’s financial condition and results of its
operations and any procedure or action undertaken under this
subsection must be disclosed in the auditor’s report.


2005, No. 8 International Banking 93

(2) It shall be the duty of the auditor to report
immediately to the Inspector, without notifying the licensee
in any way, of any information relating to the affairs of a
licensee obtained in the course of an audit, if the auditor is
of the opinion that-
(a) the licensee is insolvent or is likely to become
insolvent or is likely to be unable to meet its
obligations or is in serious financial
difficulties;
(b) a criminal offence involving fraud, dishonesty or
money laundering has been committed;
(c) serious irregularities have occurred, including
irregularities that jeopardize the interest of
depositors and creditors;
(d) losses have been incurred which substantially
reduce the capital funds of the licensee; or
(e) the auditor is unable to confirm that the claims of
creditors are still covered by the licensee’s
assets.
(3) The auditor may be required by the Inspector to
discuss the audit directly with the Inspector or be asked to
provide additional information regarding the audit.
(4) The Inspector, may, by notice in writing to a
licensee, require it to supply the Inspector with a report,
prepared by its auditor on such matters as the Inspector may
determine, which may include an opinion on asset quality,
adequacy of provisions for losses and the adequacy of the
accounting and control systems.
(5) No civil, criminal or disciplinary proceedings shall
lie against any auditor arising from the disclosure in good
faith of information to the Inspector pursuant to this section.

37. Preservation of confidentiality-(1) Subject to this
section and except for the purpose of the performance or
exercise of their duties or functions under this Act or other
law or when lawfully required to do so by any court of
competent jurisdiction within Samoa, the Minister, the
Inspector or any officials or officers thereof, including any
authorised person and any person appointed under sections
34, 43 or 44, shall not disclose any information relating to
any application by any person under the provisions of this
Act or to the affairs of a licensee or of any customer of a
licensee which the Minister, the Inspector or other person, as



94 International Banking 2005, No.8

the case may be, has acquired in the performance or exercise
of such duties or functions under this Act.
(2) Subsection (1) shall not apply to a disclosure by the
Inspector -
(a) necessary for the effective regulation of a licensee;
(b) in respect of the affairs of a licensee or a
customer of a licensee with the authority of
the licensee or the customer of the licensee
which has been voluntarily given, as the case
may be;
(c) where the information is already in the public
domain;
(d) where the Inspector believes that a suspicious
transaction was not reported as required
under the Money Laundering Prevention Act
2000; or
(e) where the Inspector believes that a transaction
may be associated with an offence under the
Prevention and Suppression of Terrorism Act
2002.
(3) The Inspector may disclose to a foreign or domestic
banking supervisory authority, or a domestic or foreign
agency responsible for the prevention and suppression of
terrorism, or the Money Laundering Authority or any other
like regulatory authority information about the licensee,
provided that -
(a) the Inspector is satisfied that the intended
recipient agency or authority is subject to
adequate legal restrictions on disclosures
which shall include the provision of an
appropriate undertaking on confidentiality;
and
(b) the information is required for the purposes of
banking supervision, or the prevention and
suppression of terrorism or the enforcement
of the Money Laundering Prevention Act
2000 or any other like law only and is not
related directly or indirectly to the
imposition, calculation or collection of taxes
or the enforcement of exchange control
regulations.



2005, No. 8 International Banking 95

(4) Every person who commits an offence under this
section shall be liable upon conviction to imprisonment for a
term not exceeding 5 years or to a fine not exceeding 50,000
dollars or both.

38. Breach of confidentiality-(1) Except as required by
or provided for under the laws of Samoa, every person
commits an offence who -
(a) divulges any information, in Samoa or elsewhere,
which the person has become aware of in the
person’s capacity as an officer, employee, or
authorised agent of a licensee, or as an officer
or employee of an approved auditor, in relation
to -
(i) any international banking business
transacted in or from within Samoa;
(ii) the transfer of money and property into
or out of Samoa in the course of any
international banking business; or
(iii) the account of any person with a
licensee or any item of such an account or the
fact of any person having, or having had such
an account; or
(b) attempts to induce any other person to breach
professional confidentiality in relation to any
such matters.
(2) Notwithstanding subsection (1), it shall not be an
offence under this section to divulge the information referred
to in subsection (1)(a) -
(a) to the Inspector pursuant to section 5 or if directed
to do so by the Minister or the Inspector
pursuant to section 30;
(b) to the person on whose behalf the international
banking business is being carried out;
(c) in Samoa, to an officer or employee of the same
licensee in the performance of the person’s
duties as an officer or employee;
(d) to an officer or employee of a bank or other such
financial institution outside Samoa, if all the
persons concerned in the banking business or
in whose name the account stands, consent in
writing to doing so;




96 International Banking 2005, No.8

(e) to an officer or employee of the licensee outside
Samoa, so long as the names of the persons
concerned in the banking business and any
information which might identify them and the
names in which accounts stand and the balance
therein, are not divulged;
(f) with the prior written approval of the Minister, to
the Government of or to a public officer of any
other country, provided such information is
used only as part of-
(i) an amount representing the total assets
of the licensee in Samoa; or
(ii) an amount representing the total sum
of money transferred to Samoa from that
country or from Samoa to that country and the
currencies in which such money was
transferred, provided that the amount of
individual banking transactions, the names in
which accounts stand, and the balances therein
are not divulged; or
(g) to the Inspector by the auditor or former auditor
of a licensee with respect to the audited
accounts or returns of the licensee.
(3) For the purposes of subsection (2)(d) all the persons
concerned in the banking business or in whose names
accounts stand, shall be deemed to have consented to an
officer or employee of a licensee divulging to an officer or
employee of a bank or other such financial institution outside
Samoa such information of the banking business being carried
out as is essential to the carrying out of that business or where
the request for information by the foreign financial institution
is pursuant to a statutory requirement binding on that foreign
financial institution, but the consent deemed to be given
pursuant to this subsection shall not apply to any other
particulars.
(4) Nothing in this section shall prevent the Court from
requiring any person to give evidence or produce documents
in any proceedings in the Court of any facts relevant in those
proceedings that the person could otherwise be required to
give or produce.
(5) Every person who commits an offence under this
section shall be liable upon conviction to imprisonment for a
term not exceeding 5 years, or to a fine not exceeding 50,000
dollars or both.


2005, No. 8 International Banking 97

39. Breach of confidentiality by officer or employee
deemed to be breach by licensee-(1) For the purposes of
section 38, an offence by an officer or employee of a licensee
or of an auditing company, as the case may be, or by a person
after termination of the person’s employment as an officer or
employee of a licensee or of an auditing company, as the case
may be, whether such offence occurs in Samoa or elsewhere,
shall be deemed also to be an offence by that licensee or by
that auditing company, as the case may be.
(2) Notwithstanding subsection (1), an offence under
section 38 by a person after termination of the official or
employment relationship with a licensee or an auditing
company shall not be deemed to be an offence by the licensee
or by the auditing company, as the case may be, if the licensee
or the auditing company can prove, on the balance of
probabilities, that it had taken all reasonable steps to prevent
an offence by the person.

PART IV
TAXATION

40. Profits and dividends-(1) Notwithstanding anything
contained in any other enactment -
(a) no income tax, nor any other direct or indirect tax
or impost, shall be levied in Samoa upon the
profits or gains of a licensee, or upon any
interest earned by a licensee, in respect of the
international banking business it does from
within Samoa; and
(b) no income tax, nor any other direct or indirect tax
or impost, shall be levied in Samoa in respect
of any dividends or earnings, or upon any
interest earned by a licensee, attributable to the
shares or securities of a licensee that are
beneficially owned by another licensee or by
an international company or a person who is
not a resident of Samoa; and
(c) no income tax, nor any other direct or indirect
tax or impost shall be levied in Samoa upon
any interest paid to a non-resident depositor
(other


98 International Banking 2005, No.8

than interest paid to a trustee company
registered under the Trustee Companies Act
1987 in their own right which is taxable in
Samoa) by a licensee.
(2) The exemptions from taxation granted under
paragraphs (a) and (b) of subsection (1) shall not apply to
the domestic banking business only of any licensee that has
been granted approval under section 12 to carry on domestic
banking business.

41. Exemption from stamp duty-(1) Bills of exchange
and promissory notes payable on demand and any other
document, instrument or certificate executed by, for or in
connection with an international bank licensed under this Act
and relating to international banking business shall be exempt
from stamp duty.
(2) Every instrument chargeable with duty executed by or
for a licensee, and not exempt under the provisions of
subsection (1), may be presented for stamping within an
extended period of 4 months after and exclusive of the day of
execution thereof (or in the case of an instrument executed out
of Samoa, within 4 months after it has first been received in
Samoa) without penalty.
(3) The exemption from stamp duty granted under
subsection (1) shall not apply to the domestic banking
business only of any licensee that has been granted approval
under section 12 to carry on domestic banking business.

42. Exemption from currency and exchange control-(1)
International banking business conducted by and in
accordance with a licence under this Act shall be exempt from
any currency and exchange control restrictions or regulations.
(2) No foreign exchange levy shall be imposed or be
payable in respect of international banking business conducted
by and in accordance with a licence under this Act.
(3) The exemptions from currency and exchange
controls and foreign exchange levies granted under
subsections (1) and (2) shall not apply to the domestic
banking business only of any licensee that has been granted
approval under section 12 to carry on domestic banking
business.


2005, No. 8 International Banking 99

PART V
SUSPENSION, CANCELLATION AND OTHER
ENFORCEMENT OF LICENCE CONDITIONS

43. Enforcement of examination findings-(1) If, in the
opinion of the Minister, an examination under section 34
shows that the licensee concerned is carrying on its business in
a manner detrimental to the public interest or of its depositors
and other creditors, or has insufficient assets to cover its
liabilities to the public, or is, either in Samoa or elsewhere,
contravening any of the provisions of this Act, the Minister
may take such one or more of the following steps from time to
time as may seem to the Minister necessary-
(a) require the licensee forthwith to take such measures
as the Minister may consider necessary in
relation to its business;
(b) impose conditions, or further conditions, as the
case may be, upon the licence and may amend
or revoke any such condition;
(c) require the removal and replacement of any
director or officer of the licensee;
(d) appoint a person who, in the Minister’s opinion,
has had adequate training and experience to
advise the licensee in the proper conduct of
its business and fix the remuneration to be
paid by the licensee to such person;
(e) appoint a person to assume control of the licensee’s
affairs who shall mutatis mutandis have all the
powers of a person appointed as receiver or
manager of a business under the Companies
Act 1955 and fix the remuneration to be paid
by the licensee to such person; or
(f) unless the Minister is satisfied that the licensee is
taking adequate measures to put its affairs in
order, make an order under section 44
cancelling the licence.
(2) If a licensee refuses or fails to take any measure
required by the Minister under subsection (1), it commits an
offence and is liable on conviction to a fine not exceeding 500
dollars in respect of every day during which the offence
continues.


100 International Banking 2005, No.8

(3) Every person who knowingly and willfully refuses or
fails to take any measure required by the Minister under
subsection (1) commits an offence and is liable on conviction
to a fine not exceeding 1,000 dollars.

44. Powers of the Minister-(1) Whenever the Minister is
of the opinion that a licensee -
(a) is carrying on business in a manner detrimental to
the public interest or detrimental to the interest
of the depositors or other creditors of the
licensee; or
(b) is or appears likely to become unable to meet its
obligations as they fall due; or
(c) has failed to comply with the terms and conditions
of its licence; or
(d) has failed to comply with any directive or
regulatory code issued by the Minister under
this Act; or
(e) is in breach of any duty or obligation imposed
upon it by this Act or commits an offence
under this Act,
the Minister may forthwith take one or more of the
following actions, as may seem necessary to Minister -
(i) require the licensee forthwith to
take such measures as the Minister may
consider necessary in relation to its
business;
(ii) impose conditions, or further
conditions, as the case may be, upon the
licence and may amend or revoke any such
condition;
(iii) require the removal and
replacement of any director or officer of
the licensee;
(iv) appoint a person who, in the
Minister’s opinion, has had adequate
training and experience to advise the
licensee in the proper conduct of its
business and fix the remuneration to be
paid by the licensee to such person;


2005, No. 8 International Banking 101

(v) appoint a person to assume control of the
licensee’s affairs who shall utatis mutandis
have all the powers of a person appointed as
receiver or manager of a business under the
Companies Act 1955 and fix the
remuneration to be paid by the licensee to
such person;
(vi) present a petition to the Court for the winding
up of the licensee; or
(vii) cancel the licence.
(2) A person appointed under subparagraphs (iv) or (v) of
subsection (1) (e) or whose appointment has been extended
under paragraph (b) of subsection (3) shall from time to time
at the person’s discretion and in any case within three months
of the date of the person’s appointment or of the extension of
the person’s appointment (as the case may be), prepare and
furnish a report to the Minister and the Inspector of the affairs
of the licensee and recommendations thereon.
(3) On receipt of a report under subsection (2), the
Minister may -
(a) revoke the appointment of the person appointed
under subparagraph (iv) or (v) of subsection
(1) (e);
(b) extend the period of the person’s appointment;
(c) subject to such conditions as the Minister may
impose, allow the licensee to reorganise its
affairs in a manner approved by the Minister;
or
(d) cancel the licence.
(4) Notwithstanding any other provisions herein, the
Minister may cancel a licence if the licensee -
(a) has ceased to carry on international banking
business or does not within six months after
the issuance of its licence commence
international banking business; or
(b) goes into liquidation or is wound up or otherwise
dissolved.
(5) The Inspector shall give notice in writing to the
licensee and, through such means as the Inspector deems fit, to
creditors, depositors, shareholders and employees of the
licensee and relevant banking authorities elsewhere of a
cancellation of the licence or a refusal to grant renewal of a
licence under section 16(3).


102 International Banking 2005, No.8

45. Minister may apply to the Court - The Minister may, in any case in which a licensee or a person who has at
any time been a licensee is being wound up voluntarily, apply
to the Court if the Minister considers that the winding up is not
being conducted in the best interest of its depositors or other
creditors, and the Court shall make such order as it shall
consider appropriate.

46. Surrender of licence-(1) A licensee who has ceased
to carry on the business in respect of which the licence was
granted may apply to the Minister to surrender its licence if
it –
(a) has ceased to carry on such business, and
produces evidence that it has repaid all
deposits held by it and has transferred all
trust assets held or administered by it; or
(b) is being wound up voluntarily and produces
evidence that it is solvent and able forthwith
to repay all deposits held by it and all its
other creditors and has transferred all trust
assets held or administered by it,
and the Minister may thereupon approve the surrender.
(2) In the case of an application under subsection (1)(b),
the Minister may apply to the Court for the licensee to be
wound up by the Court, and on the making of such an order
the provisions of the International Companies Act 1987
relating to the winding up of a company by that Court shall
mutatis mutandis apply.

47. Appeals-(1) Subject to subsection (2), any person
affected adversely may, within 21 days of the date of the
decision appealed from, appeal to the Court, from -
(a) any decision not to renew a licence under section
16;
(b) any decision to cancel a licence under section
44(1), (3) or (4);
(c) any decision by the Minister to enforce
examination findings under section 43(1); or
(d) any decision by the Minister to take any of the
actions under section 44(1),


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Provided that any person affected adversely by a
decision of the Minister referred to in paragraphs (a), (b),
(c), or (d) of this subsection may, upon notice to the
Minister, apply to the Court for leave to extend the time
within which the notice of appeal must be filed. The Court,
upon hearing such application, may extend the time
prescribed by this section, as it deems fit.
(2) The only grounds for an appeal under this section
shall be that the decision was ultra vires or was an
unreasonable exercise of the Minister’s powers or was in
breach of the Constitution.
(3) In determining any appeal under this section the Court
may, if it thinks fit -
(a) exercise any of the powers conferred on the
Minister by this Part;
(b) cancel or amend any decision to which the appeal
relates; or
(c) confirm any such decision.
(4) The decision of the Court on appeal proceeding
brought before it under this section shall be final and
conclusive.
(5) In determining an appeal under this section the Court
shall not have the power to award damages or costs against the
Minister or the Inspector or the Government.
(6) An appeal against a decision of the Minister shall not
have the effect of suspending the execution of such a
decision.
PART VI
MISCELLANEOUS
48. Protection of the terms "bank" and
"international bank"-(1) Except as provided by law or
with the approval of the Minister in writing, no person, other
than the holder of a valid international banking licence
issued under this Act, shall:
(a) use the word "bank" or "international bank" or any
of its derivatives in any language in the
description or title under which such person is
carrying on international banking business
from within Samoa; or


104 International Banking 2005, No.8

(b) make or continue to make any representation in
any billhead, printed form, letter, paper, notice,
advertisement or in any other manner
whatsoever that such person is carrying on
international banking business from within
Samoa.
(2) Every person who contravenes this section commits an
offence.
(3) In this section the term "printed form" includes a form
of which copies are produced by cyclostyling, or by any
duplicating or reproduction process, whether letterpress,
photographic, lithographic multigraphic, or stenciling, or any
other process.

49. General penalty for offence - Every person who
commits an offence against this Act and any regulations issued
hereunder for which no penalty is provided, otherwise than in
this section, is liable upon conviction to imprisonment for a
term not exceeding 1 year or to a fine not exceeding 10,000
dollars or to both, and, if the offence is a continuing one, to a
further fine not exceeding 500 dollars for every day on which
the offence has continued.

50. Application of International Companies Act to
winding up-(1) The provisions of Part IX of the International
Companies Act 1987 shall, so far as they are applicable and
with the necessary modifications, apply with respect to the
winding up of companies licensed under this Act.
(2) The Court shall have jurisdiction in every such
winding up.

51. Civil remedies not affected - Nothing in this Act shall
affect any civil remedy that any person may have against a
licensee in respect of any matter.

52. International banking not an authorised trustee
investment - A deposit or lodgment of any kind or any other
form of security arrangement with an international bank
licensed under this Act shall not constitute an authorised
investment for co-operative societies, credit unions, industrial
and provident societies, and trustees, other than a trustee
company licensed under the Trustee Companies Act 1987 or


2005, No. 8 International Banking 105

except where otherwise expressly authorised under the trust
settlement or by other Act.

53. No other business licence required - Except as
provided by this Act, no other business licence shall be
required to operate as an international bank from within
Samoa.

54. Choice of measures - A holder of a valid licence
under this Act may conduct its international banking business
(including its books and accounts relating thereto) in
accordance with its licence without restriction as to the
measurement system to be adopted or as to decimalization.

55. Regulations - The Head of State, acting on the advice
of Cabinet, may from time to time make Regulations
prescribing all matters and things required or authorised by
this Act to be prescribed or provided, or which are necessary
or convenient to be prescribed or provided, for the carrying
out of, or the giving full effect to, the provisions of the Act and
its due administration including, but not limited to, all or any
of the following particular purposes -
(a) prescribing forms to be used for the purposes of
this Act and the matters to be specified in such
forms;
(b) prescribing forms of application and other notices
under this Act;
(c) fixing the fees and charges to be paid under this
Act and the penalties for breaches thereunder,
or delegating the power of fixing such fees,
charges and penalties to prescribed persons or
bodies;
(d) empowering the employment of non-citizens and
non-residents required to provide efficient
services for the due administration of this Act,
subject to and on the following conditions-
(i) any person employed as a barrister or a
solicitor must obtain a practicing certificate
under the Law Practitioners Act 1976; and
(ii) any person employed as a public
accountant must obtain a certificate of public
practice under the Public Accountants Act
1984; or


106 International Banking 2005, No.8

(e) delegating to the Minister the function of granting
such duty and other concessions as shall be
desirable to facilitate the objectives of the Act.

56. Immunity-(1) No action shall lie against the
Government or any statutory body or authority of Samoa, the
Minister, the Inspector or any person acting pursuant to any
authority conferred by the Minister or the Inspector, as the
case may be, in respect of any act or matter done or omitted to
be done in good faith in the exercise or purported exercise of
their respective functions conferred by or under this Act or any
regulations made thereunder.
(2) The legal costs of defending any action instituted
against the Minister, the Inspector or any person acting
pursuant to any authority conferred by the Minister or the
Inspector shall be borne by the Government of Samoa.

57. Procedure where none laid down - In the event that
any act or step is required or permitted to be done under this
Act, and no form is prescribed or procedure laid down in this
Act or Regulations for doing the same, the Inspector may in
response to application made to the Inspector, or on the
Inspector’s own motion, give directions as to the manner in
which the same may be done, and any act or step done or
taken in accordance with the Inspector’s directions shall be a
valid performance of such act or step.

58. English the authentic text-(1) Every document filed
with the Inspector, and all records and accounts required to be
kept under this Act shall be in the English language.
(2) Where a document is not in the English language it
shall be accompanied by an authentic English translation; and
in the event of any conflict in meaning between the foreign
language and the English versions, the English version shall
prevail.

59. Repeal of Off-Shore Banking Act 1987 - The Off-
Shore Banking Act 1987 is repealed.

60. Transitional-(1) Any licence, authority, approval or
exemption granted under the repealed Act that is in force
immediately before the commencement date of this Act -


2005, No. 8 International Banking 107
(a) shall continue to have effect after the
commencement date as if granted under this
Act; and
(b) in the case of a licence or grant for a specific
period, shall remain in force for so much of
that period as falls after the commencement
date.
(2) Where prior to the commencement of this Act, an
application, request or petition had been made to the Minister
or the Inspector of Offshore Banks, in respect of any licence,
permit, authorisation or approval required to be given by the
Minister or the Inspector, as the case may be, under the
Offshore Banking Act 1987, and which has not been
completed or otherwise determined, such application, request
or petition shall continue to be dealt with and completed or
otherwise determined in all respects as if this Act had not been
enacted.
61. Consequential amendments – The enactments
specified in the Schedule to this Act are hereby amended or
modified in the manner indicated in that Schedule.
SCHEDULE (Section 61)
Section 58 Enactments Amended
Enactment Extent of Amendment or Repeal
Shops Ordinance 1961 By amending section 6A to delete the
words “an off-shore banking
business licensed under the Off-shore
Banking Act 1967” and substituting
the words “an international bank
licensed under the International
Banking Act 2005”.

Post Office Act 1972 By deleting 17(2)(j) and substituting
the following:

“(j) Letters by, for or in respect of an
international bank licensed under the
International Banking Act 2005, an
international insurance company
licensed under the International
Insurance Act 1988, an international
company registered under the
International Companies Act



108 International Banking 2005, No.8
1987, a trustee company licensed
under the Trustee Companies Act
1987 or an international partnership
or limited partnership registered
under the International Partnership
and Limited Partnership Act 1998;”

Bills of Exchange Act 1976 By amending section 73(1) by
deleting the words “including an off-
shore bank licensed under the Off-
shore Banking Act 1987” and
substituting the words “including an
international bank licensed under the
International Banking Act 2005”.

Law Practitioners Act 1976 By amending the proviso in section
2(2) by deleting the words “with off-
shore banking or the giving of advice
on off-shore banking matters” and
substituting the words “with an
international bank licensed under the
International Banking Act 2005 or
the giving of advice on international
banking matters”.

Public Accountants Act 1984 By amending section 3(2)(d) by
deleting the words “of an off-shore
banking business licensed under the
Offshore Banking Act 1987” and
substituting the words “of an
international bank licensed under the
International Banking Act 2005”.

International Companies Act 1987 By amending section 40 by deleting
the words “Off-shore Banking Act
1987” and substituting the words
“International Insurance Act 1988 or
the International Banking Act 2005”.

By amending section 54A(10)(a) by
deleting the words “Off-shore
Banking Act” and substituting the
words “International Banking Act
2005”.

By amending section 227(4)(i) by
deleting the words “Offshore
Banking Act 1987” and substituting
the words “International Banking Act
2005”.


2005, No. 8 International Banking 109
By amending section 249(2)(a) and
(b) by inserting after the words
“every international company and
every foreign company registered
under Part X” the words “other than
an international bank licensed under
the International Banking Act 2005”.
By amending section 249(2)(c)(ii) by
deleting the words “Off-shore
Banking Act 1987” and substituting
the words “International Banking Act
2005”.
By amending section 249(3)(a), (b),
(c) and (d) by inserting after the
words “by an international company
or a foreign company registered
under Part X” the words “other than
an international bank licensed under
the International Banking Act 2005”.
By amending section 249(4)(a) by
inserting before the words “carry on
business” the words “unless it is an
international bank licensed to carry
on domestic banking business under
the International Banking Act 2005,”
By amending section 249(5)(e) by
deleting all the words following the
words “are prepared or maintains”
and substituting the words “or, being
a licensee under the International
Banking Act 2005, from where it
maintains and operates its business.”
Financial Institutions Act 1996 By amending section 28 by deleting
paragraph (c) and substituting the
following:
“(c) Any company licensed under the
International Banking Act 2005 or
any act replacing that Act, but only
in respect of those companies that
have not commenced domestic
banking business, pursuant to
approval granted under the said Act;”


110 International Banking 2005, No.8
Money Laundering Prevention By amending section 13(2) by
Act 2000 inserting after the words “the
licence” the words “or registration”
and by deleting the words “the
Offshore Banking Act 1987 and the
Financial Institutions Act 1996” and
substituting the words “any Act.”
By amending paragraph 1 of
Schedule 1 by deleting the words
“Off Shore Banking Act 1987” and
substituting the words “International
Banking Act 2005.”

By deleting paragraph 2 of Schedule
1 and substituting the following:

“2. “International banking business”
as defined in the International
Banking Act 2005”

Foreign Investment Act 2000 By amending the definition of
“foreign investment” in subsection
(2) of section 2 by inserting after the
words “Business Licences Act 1998”
the following sentence:

“Provided that the provisions of this
Act shall not apply to trustee
companies licensed under the Trustee
Companies Act 1987, international
companies or foreign companies
registered under the International
Companies Act 1987, international
insurance companies licensed under
the International Insurance Act 1988
or international banks licensed under
the International Banking Act 2005,
or any successor legislation to the
above Acts.”
__________
The International Banking Act 2005 is administered in the
Central Bank of Samoa