Regulation - Financial Supervision Commission

Regulation of the finance sector in the Isle of Man is carried out by the Financial Supervision Commission and the Insurance and Pensions Authority. The Financial Supervision Commission (FSC) is responsible for the licensing, authorisation and supervision of banks, building societies, investment businesses, collective investment schemes and fiduciary businesses. Institutions and businesses that wish to operate from the Isle of Man must establish a real presence with offices and staff and do real business.

Legislation

The main piece of legislation administered by the Financial Supervision Commission is the Financial Services Act 2008 (and the Collective Investment Schemes Act, if applicable) and all subordinate legislation of these Acts. Licence categories are:

Class 1 - Deposit Taking

Class 2 - Investment Business

Class 3 - Services to Collective Investment Schemes

Class 4 - Corporate Services Class

Class 5 - Trust Services

Class 6 - Money Transmission Services

Class 7 - Management or Administration Services

Depositor Compensation Scheme

The Isle of Man has a Depositors Compensation Scheme. The Financial Supervision Commission is the Scheme manager.

Banking Licences

The licensing policy that the Commission adopts for banks is based upon the fact that the Island has no lender of last resort and is too small to shoulder high risk or start-up operations.

Managed Licenceholders

The Commission is prepared to allow major banks to establish a presence in the Island on a managed bank basis. Applicants for these licenses have to meet the same tests on parentage etc., as outlined above for Domestic Banking Institutions except that they will not have their own premises in the Isle of Man.