US VIRGIN ISLANDS LAW AND PRACTICE Contributed by: Marjorie Roberts, Sean Foster, Renée Marie André, Lisa Wisehart, David Bornn, Duncan J. J. Kessler and Jessica McKenney, Marjorie Rawls Roberts PC
5.2 Securities Regulation The USVI enacted the Uniform Securities Act (9 V.I.C. §§ 601-691) in 2004. The act provides for registration requirements for securities, broker-dealers, agents, investment advisers and investment adviser repre - sentatives transacting business in the USVI. The act also lists exempt securities and transactions. The Administrator under the Act is the Lieutenant Governor of the USVI. Under title 9 section 668 of the V.I. Code, the Administrator can cooperate, consult, or coordinate with states and foreign jurisdictions, governmental law enforcement agencies, federal or state banking and insurance regulators, national or international organizations of securities regulators and self-regulatory organizations. The Act also specifically states that the Administrator can cooperate, consult, or coordinate with: • the Securities Investor Protection Corporation; • the Federal Trade Commission; • the Commodity Futures Trading Commission; • the United States Department of Justice; and • the Securities and Exchange Commission. Examples of cooperating, consulting or coordinating include to: • minimise business of capital formation burdens – without negatively impacting investor protections; • maximise protection of investors regulation effec - tiveness and federal and state regulatory standards uniformity; • develop uniform forms; • conduct joint examinations, investigations and administrative hearings; and • commence joint civil and administrative proceed - ings. 5.3 Investment Funds This matter is fact-specific. Dependent on the nature and structure of the investment fund, it may be subject to additional regulatory review if connected to one of the USVI tax incentive programs, such as the EDC tax incentive program or RTPark program – particularly if a beneficiary is seeking tax incentive benefits. Chiefly, EDC beneficiaries are regularly reviewed by the EDC
tion annually, including names and addresses of legal or equitable owners who claim EDC benefits as bona fide USVI residents, employee reporting, etc.
5. Capital Markets 5.1 Capital Markets Overview
There are 3 full-service commercial banks in the USVI that are affiliated with banks based in Puerto Rico and 2 locally chartered banks in the USVI. USVI banks offer different types of loans, such as business and mortgage loans. The Economic Development Bank for the United States Virgin Islands (“EDB”) – formerly the Govern - ment Development Bank and the Small Business Development Agency – under title 29 sections 901- 915b – is part of the Economic Development Authority,
and offers several loan options: • development loan program; • micro-credit loans; • Frederiksted loan program; • intermediary relending program;
• farmers and fishermen loan program; • state small business credit initiative; • small business development loan; and • economic development administration loan. Most of the financing options offered through the EDB require five to ten years of USVI residency and/or a business location in the USVI. Further, beneficiaries of the EDC tax incentive pro - gram, discussed in more detail elsewhere in this arti - cle, are incentivised to make capital contributions of USD1,000,000.00 or more to USVI business entities or to business entities in the USVI. USVI businesses also use loan options outside the USVI, such as mortgage or auto loans. Given the many Virgin Islanders who serve or have served in the US Military, the United Services Automobile Associa - tion (USAA) is a popular loan provider for individuals.
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