NASSAU, BAHAMAS — Attorney General Ryan Pinder said yesterday that it is now time for the financial services industry to “innovate again” as he warned that this nation could lose a significant number of funds licensed in The Bahamas as a result of tax policy to be introduced imminently by Brazil.
While addressing the Nassau Conference, Pinder noted that the ICON, developed jointly between The Bahamas Government, the Bahamian financial services industry, and the Brazilian legal community, is now under threat.
Pinder pointed out that ICON created another influx of licensed funds originating from Brazil, providing a product that was structurally familiar to the investment condominium in Brazil. As a result of these innovations, a material amount of funds licensed in The Bahamas originated from Brazil.
“This is now all at risk due to tax changes that are proposed in Brazil. Brazil is close to passing controlled foreign corporation laws which would eliminate any tax benefit of holding financial investments in an offshore fund. We could end up losing a material amount of funds in The Bahamas, with clients unwinding their structures before year-end. We enjoyed the prosperity of our innovation for 10 years; it is now time to innovate again,” said Pinder.