CROSS BORDER CONVERSION AND MERGER (part 10)
Legal entities under supervision
So far we have only looked at legal entities not under the supervision of the Central Bank of Curacao and St. Maarten (CBCS). Just a few words about institutions that are under supervision.
The following applies to banks with a registered seat in Curacao for instance. These entities have a license from the CBCS pursuant to the Ordinance on the Supervision of Bank and Credit Institutions 1994 (Landsverordening toezicht bank- en kredietwezen 1994: ‘Ltbk’). The prior consent of the Central Bank is required for each amendment to the articles of association (Article 23 paragraph 1 Ltbk). That also applies to any corporate re-organization, although it is not sufficiently clear what exactly should be meant by this.
Moreover a transfer of seat or cross-border conversion would most probably qualify as a winding up of the activities in Curacao which should be reported to the Central Bank and must be carried out under the supervision and directions of the Central Bank (Article 26 Ltbk).
Curacao banks are therefore by definition unable to effect a cross-border merger or conversion (outbound) without the consent of the CBCS. If a foreign bank wants to be converted into a Curacao company (inbound) this will only be possible after a license has been received from the CBCS (Article 2 paragraph 1 Ltbk).
If a foreign bank as a disappearing company wants to merge with a bank registered in Curacao this also requires the consent of the CBCS. For, pursuant to Article 23 paragraph 1 under d Ltbk it is not allowed to enter into a merger with another institution or enterprise without the prior consent of the CBCS. The CBCS can attach conditions to that consent.
Karel Frielink
Attorney (Lawyer) / Partner
(12 April 2013)
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