Fit and proper assessments in the Caribbean Netherlands

The purpose of our supervision is to ensure sound and ethical financial institutions that meet their obligations, and the assessment procedure is an important part of this. Fit and proper management and supervisory board members are essential to an enterprise’s strategy and corporate culture, and therefore to its soundness and future viability.

Contact

You can contact your account supervisor or DNB’s Expert Centre on Fit & Proper Assessments at +31 20 524 9111 or at toetsing.expertisecentrum@DNB.nl if you have any questions.

Branch offices: Concurrence of assessments conducted by DNB and the CBCS

Branch offices in the Caribbean Netherlands generally have their registered office in Curaçao or Sint Maarten. The Central Bank of Curaçao and Sint Maarten (CBCS), as 'home country' supervisor, also conducts assessments. Since a branch office itself has no legal personality, this means that individuals nominated for appointment to a position that requires assessment must be assessed by both CBCS and DNB. Both supervisory authorities must reach a positive opinion and approve the appointment. The assessments by CBCS and DNB may be conducted simultaneously.

For branch offices, prudential supervision is exercised by CBCS and integrity supervision by DNB. Therefore, the focus of our assessment of a branch office appointee, is on integrity supervision.

Who are assessed?

The following persons are subjected to our fit and proper assessments:

• the day-to-day and co-policymakers, including as a minimum the directors, of a financial institution having its registered office or a branch office in the public bodies
• the members of a supervisory body, such as a supervisory board or council of a financial institution having its registered office or a branch office in the public bodies
• the day-to-day and co-policymakers of a qualifying holding in a financial institution having its registered office in the public bodies
• the branch office manager of a financial institution having a branch office in the public bodies

It is prohibited to appoint the above persons without our prior approval. We grant the approval for appointment in the decision following an assessment that has a positive outcome.

When does assessment take place?

Initial assessment
An appointee must be subjected to a fit and proper assessment in the event of an application for a licence or registration and if an individual is nominated for appointment to a position that requires assessment. An appointee may only start in their new position once we have issued a positive decision.

Similarly, if an appointee wishes to hold another position that requires assessment, they must be assessed prior to appointment. In such as case, this generally concerns only a fitness test.

Reassessment of propriety
We assess propriety every three years as a rule. After a period of three years, we always reassess propriety. No set frequency applies in the case of propriety assessment.

Reassessment
A change in relevant facts or circumstances may give us reasonable cause to reassess the fitness or propriety, or both, of a previously assessed appointee. We then conduct a reassessment.

Fees

We generally charge a fee for initial assessments.

We charge a fee from the moment an application for assessment is submitted. The fee is also payable if an application is withdrawn or if it proves incomplete and is not completed before the deadline.

Consideration period

Within eight weeks of receiving an assessment application, we must make a decision on the assessment. If we have not received all the information we need, we can suspend this deadline. This also includes information to be provided by an appointee during an assessment interview.

If needed, we can suspend our consideration period for a longer period in mutual agreement with the enterprise and the appointee. We confirm such an agreement to the institution in writing.

Propriety

DNB verifies whether the propriety of an appointee is beyond doubt. We assess their propriety before they are allowed to hold the proposed position, and every three years thereafter or when special circumstances warrant a reassessment.

A propriety assessment focuses exclusively on the appointee. This means that – unlike fitness assessments – our assessment does not depend on circumstances such as the composition of the management board, the type of institution that the proposed appointment pertains to, nor the specific position the appointee will hold.
As part of our assessment, we consider the appointee’s intentions, actions (acts or omissions) and antecedents. These criteria are detailed in the Pensions Act (BES) Regulation (for pension funds) the Financial Markets (BES) Decree (for other financial enterprises).

As part of our propriety assessment, we always consider whether there are, or could be, conflicting interests. These may arise, for example, if the appointee is a local politically exposed person (PEP).

If facts and/or circumstances arise after the assessment that may affect the appointee's propriety, both the appointee and the institution are responsible for reporting this to us. We will then consider whether those facts and/or circumstances give us reasonable cause to reassess the appointee’s propriety.

If those facts and/or circumstances are not reported, we may flag this as a supervisory antecedent, which may weigh heavily in a propriety reassessment.

As a rule, it is better to report too much than too little. When investigating a reported antecedent, we regard full disclosure as a mitigating factor. If you have any questions, please contact your account supervisor, the Expert Centre on Fit & Proper Assessments, or email us at toetsing.expertisecentrum@dnb.nl.

Fitness

When assessing fitness, we determine whether an appointee has sufficient relevant knowledge and skills, and displays the required professional behaviour to perform the job, based, as a minimum, on their education, work experience and competences.

As a fitness assessment is position-specific, the assessment takes into account (i) the specific position, (ii) the institution’s type, size, complexity and risk profile and – if a position on the board is involved – (iii) the composition and functioning of the board as a whole.

The appointee should be fit for the position as at the date of appointment, meaning they must have studied the institution's products, operational organisation and culture prior to the assessment. To this end, they may read public and internal policy documents and talk to members of the management and supervisory boards and/or supervisory council. This provides an appointee with an understanding of relevant trends and market developments, legal and regulatory requirements, the main challenges and bottlenecks for the organisation and possible issues at play. If necessary, the institution can ask the appointee to sign a confidentiality agreement to allow them to prepare adequately for the intended position.

A fitness assessment comprises the following topics:

• Management, organisation and communication
• Products, services and markets in which the institution operates
• Sound and ethical operational management
• Balanced and consistent decision-making
• Sufficient time

Each appointee is also assessed in terms of competences. The Policy Rule on Fitness 2012 () lists 18 competences, including independence, persuasiveness, ability to cooperate, decisiveness and helicopter view and judgement. Different competences are important for each position, so an appointee does not have to have all the competences. The list in the Policy Rule is not exhaustive.

Documents to be submitted

Appointments questionnaire for the Caribbean Netherlands
For each assessment – both fitness and propriety – the appointee must complete and sign the Appointments questionnaire for the Caribbean Netherlands. Together with additional documents (as a minimum a passport copy and a CV), the questionnaire can be emailed to toetsing.expertisecentrum@dnb.nl.

We ask that you also submit the following documentation together with the questionnaire.

Job profile
The job profile must address at least:

• Fields of expertise
• Duties and responsibilities
• Expected time commitment
• Required competences
• Requirements in terms of education and experience

Description of the recruitment and selection procedure
Please provide a description of the recruitment and selection procedure that was followed to recruit and select the appointee. Rather than attaching a standard procedure document, we would ask you to elaborate on the actual procedure followed.

Description of decision-making and appointment considerations
Please provide a description of the decision-making process preceding your selection of the appointee, including your considerations as to why the appointee meets the job profile. If relevant, describe the measures taken to counter any conflicts of interest or the semblance thereof.

Suitability matrix
The suitability matrix and accompanying notes provide insight into the appointee's expertise and capabilities and of those of the other board members. The composition of the board as a whole also plays a role in assessing a person’s fitness.

To properly assess the matrix, we need the following:

• A description of how the matrix was composed,
  how the scores were calculated, who awarded the scores, whether they were discussed within the board as a whole, and whether the appointee has seen the completed matrix.
• Answers to the following questions:
  1. On which points does the board as a whole score best and worst, in your opinion, and why?
  2. How will these weaker points be compensated?
  3. What is the added value of the appointee with respect to the other board members?

Time commitment
Please also provide an indication of the appointee's actual time commitment. Please state the average weekly or monthly time commitment for each of the secondary positions stated in the appointee's CV. Please feel free to prepare a separate document for this purpose.

Notes on preparations for the position
A description of how the appointee has prepared for the position may help us form a comprehensive picture of his or her fitness. Examples of the appointee's activities include reading relevant documents, holding meetings or discussions with others within the organisation, attending meetings as an observer or participating in internal or external training programmes.

Additional documents
You can add more documents if you believe they provide us with a more comprehensive picture of the appointee or the position. Examples include a training or induction programme, assessment outcomes and management development assessments.

The assessment procedure step by step

Receipt of application
Our assessment starts when we receive the application, by post or by email at toetsing.expertisecentrum@dnb.nl). We check the application form and accompanying submissions and send out a confirmation of receipt. If the application is incomplete, we ask that you supplement it.

Preliminary assessment
Once the file is complete, our Expert Centre on Fit & Proper Assessments performs a preliminary assessment. In doing so, we consult both public and non-public sources, including the tax authorities, the Fiscal Intelligence and Investigation Service (FIOD), the Public Prosecution Service (OM) and the Chamber of Commerce (KvK). In addition, we may source information from national and international financial supervisory authorities and criminal law authorities, and check references. As we do not always contact referees to check references, we would advise you to inform your referees beforehand that we might not contact them. Furthermore, we use information on circumstances and challenges facing the institution that we gather from our ongoing supervision practices.

Assessment interview
If the picture emerging from our preliminary assessment is sufficiently clear, we may issue a positive decision without arranging an interview. If this is not the case, or if we need more information, we will invite the appointee for an assessment interview. We may also wish to invite them because of the importance of the position or the situation at the institution in question.

If the interview does not give us a clear and comprehensive picture, we may schedule a second interview, and inform the appointee of the reason for the second interview.

Decision-making
Based on our assessment and one or more interviews, we will issue a decision about the appointee’s fitness or propriety, or both, as soon as possible. We cooperate with the CBCS in the case of institutions that are subject to both our and the CBCS's supervision.

An appointee can be appointed and work in a policy-making capacity once we have issued a positive decision.
If we intend to issue a negative decision, we will inform the appointee in writing of our intention to do so and contact them by telephone to explain our findings and conclusions. The appointee and the institution may present a statement of views in response to the provisional decision. If we decide to uphold our negative decision, they will have the option to object and appeal.

Procedure in the event of a (provisional) negative decision

Statement of views
A statement of views is an oral or written response to a provisional decision. Both the institution and the appointee may submit a statement of views. We consider the arguments put forward in taking our final decision. The final decision is drawn up by the staff members who also carried out the assessment. If we decide to uphold our negative decision, they will have the option to object and appeal.

Objection and/or appeal
Any interested party may, within six weeks of the date of its announcement, lodge an appeal against this decision with the Court of First Instance (Gerecht in eerste aanleg) of Bonaire. Before appealing, an interested party may, also within six weeks of the date of its announcement, submit a notice of objection against DNB’s decision.