Think International Financial Services. Think The Cook Islands

The Cook Islands is made up of 15 islands spread across 1.8 million square kilometres of the South Pacific, with international financial services, alongside tourism, constituting the backbone of its economy. Cognisant of this, the Cook Islands Government is ever proactive in pioneering solutions that ensure it is not only an unparalleled jurisdiction for those seeking wealth management solutions, but that it is a veritable force for good and beacon of compliance for all stakeholders.

In these endeavours it is supported by various international institutions, not least the Asian Development Bank, which has provided budgetary assistance to help the Cook Islands recover from the COVID-19 pandemic, complemented with technical support in respect of economic modelling in addition to strategic advice to the Ministry of Finance.

Perhaps best known for its asset protection trust which others have sought to emulate but never matched, the politically stable Cook Islands’ suite of products and services combine to offer up a safe haven from the storms of international market volatility and financial instability. Affording, security, protection and privacy while successfully adhering to evolving AML/CFT regulations designed to combat secrecy and promote transparency and accountability, the Cook Islands can legitimately help shield assets from bad actors, potential legal challenges, and creditors. Moreover, its portfolio provides scope to reduce tax burdens and boost wealth.

Behind the headlines and overseen by the Cook Islands’ regulator, the Financial Supervisory Commission (FSC), there is an ongoing process of digitisation, tax and banking reforms set to further steel the Cook Islands and to ensure the jurisdiction is aligned with international standards and best practice.

“Pulls Cook Islands should be front and centre of those seeking financial certainty in uncertain times.”

With exciting developments across the banking sector, most notably at Capital Security Bank, which offers a range of wealth management services, access to global exchanges and investment opportunities alongside a full-service private banking offer, the Cook Islands should be front and centre of those seeking financial certainty in uncertain times.

Because here, perhaps more than anywhere it is understood that while compliance, accountability, transparency and responsibility are essential pre-requisites for a well-oiled and fair global financial machine, this must not come at the expense of discretion and privacy for the law abiding.

The Ultimate Protection
For high-net worth individuals, their families and their professional advisors looking to implement a wealth management plan, the Cook Islands international financial services sector has become an unrivalled ‘go-to’ proposition.

The associated infrastructure within the Cook Islands is marked by the rule of law being upheld by the judiciary and a rich body of reputable and experienced professional service practitioners.

Trusts
The Cook Islands International Trust acts as the mothership product and has ensured this Pacific jurisdiction has become a leader in the preservation and protection of wealth since the initial legislation was enacted some forty years ago.

Subsequent legislative amendments mean the Cook Islands has stayed one step ahead of the game with pioneering and innovative wealth management solutions that align with the international political and economic mores of the day, yet fundamentally serve to protect assets. Testament to this is that others have sought to ape the ground-breaking approach which sees trustees’ capacity to successfully fulfil their duty to preserve and protect trust assets enhanced. The narrative here is that the Cook Islands has created the legislative conditions whereby wealth can be protected from those who attempt to take it by force, litigation or legislation, whether through illegal, unethical or immoral means.

13B
A particularly noteworthy enhancement to the original trust legislation was introduced in 1989, with the most significant and pivotal provisions contained in section ‘13B’. It determines when a settlement of assets upon a Cook Islands International Trust may be deemed not to be fraudulent, as well as introducing limitation periods regarding any action or proceeding to seek relief or remedy, in addition to detail on what proof must be brought. It served and continues to serve to cement the Cook Islands’ reputation for robust asset protection that is both world-leading and fully compliant with the prevailing international winds of the day.

IRPT
In an exciting recent development, the Cook Islands International Relationship Property Trust (IRPT) has been introduced into the suite of products. It constitutes a tool that can provide certainty for couples in a relationship regarding the management of property in the event of separation, ensuring one or other spouse is not disadvantaged, nor the children of the relationship in question. Early signs are that it is set to be extremely well received by the market.

CILLC
Meanwhile, another integral part of the Cook Islands portfolio of wealth planning tools comes in the form of the Cook Islands Limited Liability Company (CILLC). Known for its flexible nature, ability to afford certainty and enhanced protection, it appeals to an international client base looking for the optimum way to structure and manage wealth when holding, managing and investing assets, where domestic alternatives simply do not meet their needs.

Foundations
For some ten years now, the Cook Islands has also provided foundations as a wealth management tool. These serve to combine elements of both international trusts and international companies to create a hybrid wealth planning vehicle marked by ease of administration and flexibility. Significantly, it is also recognised in both common as well as civil law jurisdictions, which explains why it has proved so popular with Chinese clients.

With a distinct legal personality, unlike a trust, a foundation is able to hold and own assets and take court proceedings, with powers exercised by its council. Equally, it differs from a company in having no shareholders.

Captive Insurance
Over the last decade, the Cook Islands has also developed its reputation as an Asia-Pacific hub for establishing and administering captive insurance structures. This self-insurance approach, which affords the opportunity to reduce costs, increase cash flow, access reinsurance markets directly and insure risks that may not otherwise be insurable, ensures organisations can better exercise control over the likes of premium levels, policy content, risk assessment and what use unused funds in the premium pool are put to.