The Mia Mottley administration is being urged to reform old legislation while guarding against implementing new ones that could place too much burden on this country’s financial services industry, a Government Senator who leads the financial technology industry has warned.
Speaking on proposed amendments to Securities (Amendment and Validation of Fees) Bill, 2019, Senator Rawdon Adams said that while the amendments are a step in the right direction toward unencumbering the financial services industry, Government must maintain the balance between regulating and enabling capital.
Senator Adams, chief executive of fintech firm Bitt, said: “We have to be very careful when we look at this type of legislation that we don’t encumber actors in the financial space with a burden of regulation that is really onerous.
“Legislation to my mind is a living entity and it something that has to reflect changes and development in society, be they economic, technological, social or political. It speaks to balancing proscription against enabling.
“With this type of legislation, we have to make sure that we don’t hamstring society.”
The bill seeks to amend the Securities Act to exempt an issuer of a security, in specified circumstances, from the obligations imposed by sections 63 to 65; and validate the charging and collection by the Financial Services Commission, of certain annual registration fees payable by the Barbados Stock Exchange from January 1, 2016 to the date of commencement of the Securities (Amendment) Regulations, 2018.
According to section 63 of the Act: “Subject to section 64, no person shall distribute a security unless a prospectus or a block distribution circular has been filed with, and a receipt therefore has been issued by, the Commission.”
In section 65 it states: “No registrant shall sell a security of a class that is the subject of a filing pursuant to section 63 and for which a receipt has been issued by the Commission, within 90 days of the date of the receipt, unless he sends or delivers to the purchaser of the security a prospectus or block distribution circular within two working days before the agreement of sale is made,”
Noting that past administrations have frequently erred on the side of proscription, Senator Adams said it is therefore crucial for the one-year-old Barbados Labour Party Government to strike a delicate balance to ensure the fluidity of the industry.
He told the Senate: “This type of legislation does not only have to take into account balance but also proportionality.
“When it comes to small and medium-sizes enterprises governed by the legislation, we know that they cannot easily finance themselves through credit or equity.
“So, it is really important that legislation like this and the related Acts on our books address this kind of issue.”