Curaçao says goal posts of financial supervision moved

~ by Suzanne Koelega ~

 THE HAGUE–The Curaçao Government said at Tuesday’s hearing of the Council of State of the Kingdom that the goalposts of financial supervision are being moved. The criteria with which the country has to comply under the Kingdom Law Financial Supervision are being changed.

The Council of State of the Kingdom held a hearing on Tuesday as part of the appeal procedure filed by the Curaçao Government against the decision of the Kingdom Council of Ministers to prolong financial supervision.

The Dutch Government maintained that the rules were clear and that Curaçao’s financial management wasn’t completely up to par as yet, despite the improvements over the past few years. Therefore, financial supervision must remain in place, at least for the time being.

Curaçao’s objection was especially aimed at the apparent extension of the criteria outside the Kingdom Law Financial Supervision with financial management as an additional requirement that the country has to comply with before financial supervision can be lifted.

According to Curaçao, it was superfluous to rate the status of financial management if the country’s budgets have been balanced for several subsequent years and the budget cycles have been accomplished within the norms of the law.

Just as at a regular Court session, parties at the public hearing presented their arguments, but in this case it was not before a Judge or Judges, but in front of five members of the Council of State: Chairman Jan-Kees Wiebenga, Hans Borstlap, Winnie Sorgdrager, Luc Verhey and Mito Croes.

Representing the Crown, or the Dutch Minister of Home Affairs and Kingdom Relations Ronald Plasterk was attorney-at-law Elisabeth Pietermaat of the Dutch law offices Pels Rijcken & Drooglever Fortuijn, while the Curaçao Government was represented by Rogier van den Heuvel of the Dutch Caribbean law offices VanEps Kunneman VanDoorne.

Financial management has become a moving object, said Curaçao representative Van den Heuvel. He explained that the Committee for Financial Supervision CFT, in charge of executing the Kingdom Law Financial Supervision, has been focusing on other points. This in itself was not considered a major issue because Curaçao benefitted from improvements in financial management. However, it becomes a problem if Curaçao is rated on moving targets, he added.

“Curaçao is not against supervision. Curaçao made and respects the agreements that were made regarding financial supervision. The supervision offers guarantees and that is good. But, the government cannot permit itself to allow a forced supervision and rating which isn’t clearly stated in the law,” stated Van den Heuvel.

Van den Heuvel stressed that Curaçao wanted to be rated on “clear” norms. “The norms are now indistinct,” he said. He asserted that the criteria based upon which the supervision was prolonged were “clearly outside the perimeters of the law.”

Van den Heuvel contended that the Kingdom Law would have to be amended, in consensus, if these additional norms were to be included. “The objective of this appeal is not to wipe the financial supervision from the table. The objective is to keep a completely clear, transparent playing field wherein this supervision takes place.”

Lawyer Pietermaat noted that it was clear from the start of financial supervision in 2010 that financial management would be part of the financial supervision. This was stated not only in the Kingdom Law and its Explanatory Note, but also the Final Declaration, the 2006 agreement to dismantle the Country Netherlands Antilles to establish the Countries Curaçao and St. Maarten.

Pietermaat said it was also common sense that financial supervision would focus on financial management as well, for without adequate financial management, there could be no structural healthy financial household. In fact, she said, the Kingdom Law does include financial management.

The Evaluation Committee Kingdom Law Financial Management, chaired by Ron Gomes Casseres, also concluded that adequate financial management was a requirement to structurally comply with the Kingdom Law, Pietermaat added. In line with the advice of this Committee, the Kingdom Government decided to prolong financial supervision for Curaçao and St. Maarten on October 8, 2015.

Pietermaat said it was “logical” that the Evaluation Committee not only looked at the figures to see if the country had complied with the Financial Supervision Law, but that financial management was analysed in the broader sense.

According to Pietermaat, financial management has to be of such a level that the countries are able to accomplish a structurally healthy financial household on their own through its own institutions and government actions.

Pietermaat emphasized that financial supervision could only be decreased or terminated if this requirement had been structurally complied with. “This point has not been reached as yet, despite the obvious improvements. Therefore, it is justified that the supervision is continued for the time being.”

Following the arguments of the lawyers, the Council of State moved to pose a number of questions to the lawyers. Member of the Council of State Borstlap inquired about Van den Heuvel’s statement that the Kingdom Government opted to secure its decision of prolonged financial supervision in one, joint Royal Decree for Curaçao and St. Maarten, instead of drafting separate decrees for the two countries.

Van den Heuvel remarked that Curaçao and St. Maarten were not always separated in the issue of financial supervision which made it more difficult to judge. This led Chairman Wiebenga to question whether the Kingdom Government shouldn’t have drafted two separate decrees for clarity sake. Lawyer Pietermaat said that this suggestion would be conveyed.

The appeal process states that the Council of State of the Kingdom will draft a preliminary decree which Chairman Wiebenga promised would be forthcoming within the shortest possible time. This decision will not be binding and will more serve as an advice for the Kingdom Council of Ministers which will take the ultimate decision

Source: The Daily Herald Curaçao says goal posts of financial supervision moved