P.R. Laws tit. 7, § 3087
(a) At the discretion of the Commissioner and under the terms and conditions he/she deems necessary as established by administrative determination to such effect, the Commissioner may issue to the applicants a license to operate an international financial institution upon receipt of:
(1) The certification of the Department of State referred to in § 3086(f) of this title;
(2) the annual fee, as provided by the regulations of the Commissioner, for a license to operate an international financial institution. Said license fee shall be paid annually within fifteen (15) days prior to the anniversary date of issue of the original license;
(3) a certified copy of the articles of incorporation, partnership agreement, or other written document establishing the international financial institution or the certification of the person of which the international financial institution shall be a unit;
(4) a copy of the bylaws or internal governing agreements adopted by the Board of Directors or similar governing body of the international financial institution, which shall be certified by its Secretary or an individual acting in a similar capacity, before a notary public;
(5) evidence that the capital of the international financial institution has been subscribed to, issued and paid-in, to the extent and under such conditions as the Commissioner may establish at his sole discretion;
(6) a statement, authenticated before a notary public, by the Secretary of the Board of Directors or the person acting in a similar capacity for the international financial institution, or for the person of which the international financial institution shall be a unit, to the effect that the international financial institution has complied with the provisions of this chapter and the regulations of the not be issued if the Commissioner believes, or has reason to believe, that the applicants have violated the provisions of this chapter or the regulations of the Commissioner; any person to whom a license has been denied, may request a hearing pursuant to the regulations provided in § 3099 of this title;
(7) as a requirement to obtain a license, every international financial institution shall possess not less than three hundred thousand dollars ($300,000) of unencumbered assets or acceptable financial securities, or that lesser sum that, at the request of the interested party, the Commissioner authorizes, when the type of business or powers that the international financial institution intends to exercise or other circumstances that, in the judgment of the Commissioner, so warrant. The unencumbered assets shall be physically located in Puerto Rico and shall be subject to the requirements regarding the same provided by the regulations of the Commissioner, and
(8) a sworn statement undersigned by the chief executive officer of the concerned institution certifying that, among other things, the international financial institution shall implement the necessary and appropriate procedures and systems to comply with the provisions of the Bank Secrecy Act. It shall also certify the steps taken by the management of the institution to implement the Bank Secrecy Act compliance program in the institution and that the necessary policies and procedures have been adopted, or shall be adopted, in the institution to comply with the provisions of OFAC, as applicable.
(b) Licenses issued to operate an international financial institution shall include a list of the authorities thereby granted to the international financial institution. The international financial institution shall exercise only those authorities listed in the license issued by the Commissioner. Licenses issued under this chapter shall be issued as “International Financial Institution” or, at the request of the applicant, as “International Financial Institution under Act XXX-2012.” Regardless of whether it is issued as “International Financial Institution” or “International Financial Institution under Act XXX-2012,” all the provisions of this chapter shall apply to such institution.
(c) No international financial institution shall begin operations unless a license has been issued thereto in accordance with the provisions of this chapter.
(d) License renewal.—
(1) Every license shall remain in effect until its expiration, which shall be on the anniversary date of the original license.
(2) Every license renewal application shall be filed within thirty (30) days before the expiration date of each license. It shall contain:
(A) A description of any material change in the information provided to the Commissioner in the initial license application;
(B) evidence that the licensee maintains the capital required by the Commissioner pursuant to § 3084 of this title, computed in accordance with generally accepted accounting principles;
(C) annual license fees totaling five thousand dollars ($5,000) for each office, by cashier’s check, certified check, postal or bank money order, payable to the Secretary of the Treasury.
(3) If the licensee fails to file the license renewal application and/or fails to pay the applicable fees within the established term or during any additional term that the Commissioner authorizes, if any, it shall be understood that the licensee has surrendered the license to operate an international financial institution and may not continue operating such business.
(4) Every international financial institution shall include in its license or license renewal application, a sworn statement undersigned by the chief executive officer of the concerned institution, attesting compliance with the provisions of the BSA applicable thereto. Among other things, the aforementioned certification shall make reference to the procedures and systems that the institution has adopted to comply with the provisions of the BSA, as applicable. It shall also certify the steps taken by the management of the institution to implement the BSA compliance program, as applicable, and that the necessary policies and procedures have been adopted in the institution to comply with the provisions of OFAC, as applicable.
(e) Upon the issuance of a license to an international financial institution in accordance with this chapter, the international financial institution shall pay taxes in accordance with the tax rate established in the Internal Revenue Code for a New Puerto Rico, §§ 30011 et seq. of Title 13. Notwithstanding the foregoing, the international financial institution may submit a copy of its license to the Secretary of Economic Development and Commerce and the latter, upon recommendation of the Secretary of the Treasury made within fifteen (15) days after filling the application, shall issue a tax exemption decree stating the tax treatment provided in this chapter. If it is in the best interest of the Government of Puerto Rico, the decree may have an effective term of fifteen (15) years with the intent to ascertain the tax treatment of the applicant international financial institution. As a requirement to obtain a decree and, as provided in the regulations to be adopted, the Secretary of Economic Development and Commerce may impose additional conditions to the international financial institution in connection with the generation of jobs or economic activity. Decrees issued under this chapter shall be deemed to be a contract between the licensee, its shareholders, partners or owners and the Government of Puerto Rico, and said contract shall be the law between the parties. Decrees shall be effective for fifteen (15) years, beginning on January 2012 or its date of issue, if later, unless the license is revoked, suspended or not renewed before the expiration date thereof, in which case the decree shall be rendered ineffective on the date of revocation or failure to renew, or during the suspension period, as the case may be. Decree shall not be transferrable; however, it shall continue in effect after a change in the control of the stocks of an international financial institution, or the merger or consolidation thereof, or the conversion of an international financial institution to a stock-based company; provided, that the change of control, merger or consolidation, or conversion, as the case may be, is authorized by the Commissioner. No new decrees shall be issued after December 31, 2019. However, any international financial institution holding a decree issued in accordance with this chapter that meets the requirements of jobs, income, investment and other factors established in the decree, may request the Secretary of Economic Development and Commerce, upon recommendation of the Secretary of the Treasury, an extension of its decree for an additional fifteen (15)-year term for a total of thirty (30) years. The Secretary of Economic Development and Commerce, upon recommendation of the Commissioner and the Secretary of the Treasury, may grant an extension to such decree for an additional fifteen (15)-year term, for a total of forty-five (45) years, if he/she believes that such extension inures to the benefit of the Government of Puerto Rico. In these cases, the applicable tax rate shall range between four (4) and ten (10) percent. The Secretary of Economic Development and Commerce, upon recommendation of the Commissioner and the Secretary of the Treasury, shall determine the tax rate that better protects the socioeconomic interests of Puerto Rico. Any recommendation required under this Section from the Secretary of the Treasury or the Commissioner shall be issued within fifteen (15) days after the application for a decree, a copy of which shall be duly notified to the Secretary of the Treasury and the Commissioner on the same date of the application for a decree, or renewal thereof, otherwise it shall be understood that there are no objections to the determination by the Secretary of Economic Development and Commerce. The application for exemption shall be filed with the Secretary of Economic Development and Commerce not later than twenty-four (24) months nor earlier than six (6) months before the expiration of the decree, and shall include the information required by the Secretary of Economic Development and Commerce for such purposes through regulations, circular letter or administrative determination.
(f) Every holder of an international financial institution license issued in accordance with the provisions of this chapter shall:
(1) Adopt the business policies and procedures to ensure that the international financial institution complies with the applicable state and federal laws, including this chapter, the Bank Secrecy Act, and the USA Patriot Act;
(2) faithfully comply with the applicable state and federal laws and the regulations applicable to the international financial institution, including this chapter, the Bank Secrecy Act, and the USA Patriot Act;
(3) file currency transaction or suspicious activity reports required by the Bank Secrecy Act and the USA Patriot Act, when necessary, and
(4) follow the practice rules and procedures that are necessary in the business to meet the requirements of OFAC, as applicable.
History —Sept. 25, 2012, No. 273, § 8.