Finance Centre assured increased govt interest

Strong legal foundations must

be in place in Vanuatu to ensure the growth of a strong private sector.

It is a strong set of commercial laws that help to create new business, encourage more contracting, simplify dispute resolution and allow for the orderly shutting down of unsuccessful companies.

These are the remarks from the speech of the Minister of Finance and Economic Management, Willie Jimmy, at the official launching of the Vanuatu Business Registry Monday at the Warwick Le Lagon Resort in Port Vila. The speech was delivered the Commissioner of the Vanuatu Financial Services Commission (VFSC), George Andrews.

He said similar reforms have been undertaken in other countries in the region and this has resulted in sustained growth in the number of new businesses.

“More businesses mean more jobs and greater prosperity for the people of Vanuatu.”

The Minister pointed to the many years during which Vanuatu’s foundations have been based on an outdated and complex model. And that since the last company laws were first put in place in 1986, significant reforms in other similar Commonwealth countries have taken place. But that these have not been consistently followed through in Vanuatu’s own legal framework.

“It is therefore important that Vanuatu put in place; (a) laws that reflect a growing internalization of company laws and (b) laws that recognize company laws form part of the fabric of international trade.”

He warned that if Vanuatu did not keep up with law reform in the financial services sector, then the companies themselves will struggle to keep up and Vanuatu will struggle to keep up.

The Minister of Finance admitted that the Government had been blamed for not involving itself more in the affairs of the finance centre in the past especially as it related to creating an environment conducive to investment and growth. But he assured everyone that from now on the Government will take a keen interest in making the centre prosper.

Key highlights of new laws expected to dramatically change the legal landscape for Vanuatu were covered in the Minister’s speech and they include: Replacing the old concepts of memorandum of articles of association with one set of company rules, model versions of which may be adopted by companies; Provisions for single shareholder/single director companies, a particularly encouraging move for ni-Vanuatu especially women to start and run their own businesses; and the process of incorporation has been vastly simplified. No company seals are required and authorized capital as a concept has been abolished.

In short, these reforms will greatly simplify starting, running and where needed, close a business and will be critical for promotion of private sector growth in Vanuatu, says the Minister in his speech delivered by George Andrews. Along with these law changes comes the opportunity to benefit from rapid advances in technology.

“With the submarine cable in place, ever-expanding use of the internet and greater access to smart phones, Government functions need to keep up with the pace of change,” the Minister continued.

“Today, Vanuatu will have one of the most modern business registries in the world and the most comprehensive. Companies, Business Name registrations and Charitable Organizations can now be set up entirely online through this business registry. Payment can also be made online.”

The staff at VFSC, with the support of the Asian Development Bank’s Private Sector Development Initiative or PSDI, the New Zealand companies office and Foster Moore, a NZ company, have been hard at work for the last year transforming the way VFSC and its customers set up and maintain the regulatory side of their business. After delivering the Minister’s speech Andrews performed the official launching of the online business registry on Monday morning.

This week, the VFSC and ADB staffs are carrying out training for staff members of a number of sectors on how to use of the registry.