~Recommendation conflicts with statute~
PHILIPSBURG--The Central Bank of Curaçao and Sint Maarten (CBCS) says a recommendation by the St. Maarten Chamber of Commerce and Industry (COCI) to give organisations outside the Bank's governance structure a formal role in placing items on the agenda of regular Board meetings would be incompatible with the Banking Statute.
COCI recently proposed governance refinements, including a recommendation that both constituent countries be guaranteed the opportunity to place substantive items on the agenda of every regular Board meeting.
Responding to questions about COCI's recommendation, the CBCS said it had taken note of the proposal and values constructive input from stakeholders. The Bank said it remains committed to maintaining an open dialogue with the governments of Curaçao and St. Maarten, as well as other relevant stakeholders, in support of "a stable, credible, and well-governed monetary union."
The CBCS said it recognises the importance of ensuring that matters relevant to both constituent countries can be brought to the Bank's attention and appropriately considered in its decision-making processes. However, it stressed that its governance framework is designed to safeguard the institutional and operational independence of the Central Bank and to ensure that its governing bodies carry out their responsibilities in accordance with their statutory mandate and governance arrangements.
According to the CBCS, the specific recommendation to give organisations outside the existing governance framework a formal role in placing substantive items on the agenda of regular Board meetings "would in our opinion be incompatible with the Banking Statute that explicitly forbids intervention by third parties regarding the discharging of responsibilities by the Central Bank."
The Bank added that the agenda for meetings of the Board of Executive Directors is determined in accordance with its governance arrangements and the responsibilities assigned to the Board under the applicable legal and institutional framework.
Despite its position on the recommendation, the CBCS said it supports the objective of maintaining meaningful engagement and ensuring that perspectives and concerns from both constituent countries are heard and considered.
The Bank said it is open to receiving topics, concerns and issues from the Chamber of Commerce or other stakeholders that they believe warrant the Bank's attention.
The CBCS also noted that it regularly engages with the Minister of Finance on financial and economic matters that are important to St. Maarten and said it highly values that dialogue.
According to CBCS, the Minister of Finance also represents St. Maarten as one of the entitlement asset holders of the Central Bank. In that capacity, the minister has responsibilities including adopting the annual statements, discharging the members of the Supervisory Board, and approving every five years the calculation of the distribution key.
The CBCS said the ministers also have the opportunity to place substantive items on the agenda of meetings of the entitlement asset holders relating to the governance and financial framework of the Central Bank.
COCI recently proposed governance refinements aimed at strengthening the long-term stability of CBCS, including a recommendation that both constituent countries be guaranteed the opportunity to place substantive items on the agenda of every regular Board meeting. The recommendation was made in a letter dated June 18, to Finance Minister Marinka Gumbs. The Chamber had said recently that it welcomed the recent understanding reached between the Governments of Curaçao and St. Maarten concerning the leadership structure of the CBCS, describing it as evidence of the commitment of both countries to cooperation, dialogue and the continued stability of the monetary union.
According to the Chamber, the agreement also presents an opportunity to further strengthen the institution through modest governance refinements. It said strong institutions are distinguished not only by their ability to resolve challenges, but also by their willingness to continuously improve governance arrangements that promote stability, transparency and confidence. The Chamber's principal recommendation is that each constituent country be afforded the opportunity to place a minimum number of substantive items on the agenda of every regular CBCS Board meeting, subject to reasonable procedural requirements and timelines.
