Minister Gumbs: St. Maarten is not simply following Curaçao on Central Bank laws

GREAT BAY--Minister of Finance Marinka Gumbs told Parliament that St. Maarten is not simply following Curaçao in the handling of several Central Bank-related draft national ordinances, but is acting within the reality of a shared monetary union that requires both countries to maintain alignment in key areas of financial and monetary supervision.

Gumbs made the statement while responding to questions from Members of Parliament about whether the draft laws before Parliament were mainly copied from Curaçao or whether St. Maarten’s own legal framework, development priorities and national circumstances were taken into account.

The Minister said she understood the concern and the perception that St. Maarten may be following Curaçao’s lead. However, she stressed that St. Maarten is an autonomous country with its own vision, priorities and policy considerations. At the same time, she said, both countries made a deliberate decision in 2010 to enter into a monetary union together, and that decision carries obligations for both sides.

According to Gumbs, legislation tied to the Central Bank, financial supervision and the stability of the monetary system cannot be treated as if St. Maarten and Curaçao operate in completely separate frameworks. She said certain areas must remain aligned to ensure the proper functioning, credibility and stability of the monetary union that both countries agreed to uphold.

“This is therefore not simply about following Curaçao,” Gumbs explained in her response to Parliament. Rather, she said, it is about ensuring that the monetary union continues to function properly, while also protecting St. Maarten’s own legal order and institutional responsibilities.

Gumbs also told Parliament that St. Maarten is not behind Curaçao on all of the draft laws. She said all four recent draft laws were submitted to the Parliament of St. Maarten simultaneously, and that St. Maarten is actually ahead of Curaçao on two of the legislative proposals, while Curaçao is ahead on the others. The process, she said, has moved at different speeds depending on the specific law and should not be presented as a one-sided matter.

The Minister said the legislative process for uniform laws within the monetary union should not be viewed as a competition between the countries or institutions involved. Ideally, she said, both countries should move in parallel through the drafting phase, legislative review, advice from their respective Councils of Advice and eventual parliamentary approval.

A central issue during the parliamentary discussion was whether the draft laws were aligned with Curaçao’s laws at the expense of St. Maarten’s own legal framework. Gumbs acknowledged that the proposed laws are largely aligned with Curaçao’s framework because both countries share one Central Bank and must maintain uniformity in important areas of financial and monetary supervision. However, she said the draft laws were adjusted where necessary to reflect St. Maarten’s constitutional and legislative structure.

According to the Minister, references in the draft laws were adapted to align with the Constitution of St. Maarten, including provisions related to independent administrative bodies, publication of regulations in the National Gazette and recognition of national ordinances within St. Maarten’s legal system. She also pointed to technical legal differences, including references to St. Maarten’s General National Ordinance on National Taxes in connection with international tax information exchange.

Gumbs said the objective is to maintain harmonization where it is needed for supervision and legal certainty within the monetary union, while ensuring that the laws fit within St. Maarten’s own legal order. In that regard, she said the laws are not merely copied, but tailored where necessary.

Several MPs also questioned the timing of the laws, noting that one of the older proposals had already entered into force in Curaçao years ago. Gumbs said the oldest draft legislation, which was approved in Curaçao in 2017, had already been submitted to the Parliament of St. Maarten in 2023, before her tenure as Minister of Finance. She said the process toward alignment had therefore been underway for some time.

The Minister acknowledged that differences in timelines between St. Maarten and Curaçao can create concerns. She said better synchronization between the two countries would be beneficial going forward, especially for legislation tied to the monetary union. Gumbs said she supports continued dialogue and coordination between both governments, the Central Bank, the respective legal teams and, where useful, both parliaments.

Gumbs told Parliament that because of the importance of alignment, she took the decision to submit the remaining draft laws together so that Parliament could consider them in a more coordinated manner. She said the intention was to avoid further delays, maintain legislative progress and strengthen St. Maarten’s regulatory framework.

Asked whether the current government stands behind all five draft laws, Gumbs said yes. She said she personally submitted the last four draft laws to Parliament and also strongly supports the oldest draft legislation because it promotes uniformity within the monetary union and supports St. Maarten’s continued connection to international financial and securities systems.

The Minister also addressed questions about whether the current government takes responsibility for laws that originated under previous administrations. She said that from a constitutional perspective, legislative proposals submitted by one government are, in principle, continued by its successor unless they are formally withdrawn. Since the proposals were not withdrawn, she said, the government stands behind them and takes full responsibility for them.

Gumbs said the broader policy objective of the laws is to ensure that St. Maarten remains a credible and reliable participant in the international financial community. She explained that the draft laws are designed to align the domestic legal framework with internationally recognized recommendations, standards and principles related to financial market integrity, supervision and stability.

On the drafting process, Gumbs explained that the earliest proposal, dealing with securities intermediaries and asset managers, was prepared by the Central Bank and reviewed only by Curaçao’s legislative department, without involvement from St. Maarten’s legislative department. She said her predecessor was not satisfied with that process, and a different approach was adopted for the four later draft laws.

For the four later proposals, the Minister said an independent legislative counsel was engaged on the initiative of the Central Bank, which acted as the commissioning authority because of its expertise in the international context behind the laws. A working group was then established, consisting of Central Bank experts and the external legislative counsel.

Gumbs said the guiding principle for those four draft laws was that substantive issues would be addressed in parallel consultation with the legislative departments of both St. Maarten and Curaçao. She said that approach was intended to ensure alignment, consistency and legal quality throughout the drafting process.

The Minister also responded to questions about consultation with the banking sector. She said the four draft national ordinances were submitted in 2020 to representative organizations for advice, including the international banking association and the Curaçao banking association. According to Gumbs, the explanatory notes to the draft laws reflect that amendments were made based on feedback received during the consultation process.

However, she acknowledged that going forward it would be beneficial to formally engage St. Maarten’s own banking association so that local perspectives and input are equally reflected in the process.

MPs also raised concerns about whether the proposed laws give too much authority to the Central Bank. Gumbs said the powers and responsibilities of the Central Bank are not newly created or expanded by these drafts. Instead, she said, the authority of the Central Bank has already been established in the Central Bank statute and in existing uniform national ordinances on banking supervision, insurance supervision and related areas.

She said the current proposals should be viewed as the continuation and implementation of already established agreements and legal principles within the monetary union. At the same time, she said, the legal framework does not prevent innovation. Gumbs said a stable and predictable financial environment, with safeguards and regulatory clarity, can support responsible innovation and strengthen confidence in the financial system.

The Minister also addressed concerns that some of the laws may already be outdated because they were developed over several years. She said she does not expect the legislative proposals to require amendments in the near future because the international standards on which they are based remain unchanged. She added that while regulatory frameworks are not static, the laws were drafted to allow future evaluation and adjustment where appropriate.

On virtual asset service providers, Gumbs clarified that the legislation is aimed at professional and commercial activities, not private individuals selling cryptocurrency for personal purposes. She said the definition was drafted broadly in line with international standards, but the licensing requirement applies only to activities carried out on a professional or commercial basis.

She said the virtual asset framework is not intended to capture a frozen view of the sector at one moment in time. Instead, it is designed to provide a foundation that allows the Central Bank to respond to developments in the virtual asset sector through regulation and supervision, without requiring constant statutory amendments.

Gumbs also said the proposed virtual asset legislation is primarily intended to close regulatory gaps and prevent St. Maarten from becoming attractive to illicit or non-compliant actors. The framework would establish licensing requirements, compliance obligations and supervisory powers for virtual asset service providers operating under the authority of the Central Bank.

On whether the Social Economic Council, SER, should have been asked for advice, Gumbs said the government recognizes the advisory role of the SER in cases where meaningful national policy choices remain. However, she said the draft laws are intended to give effect to international recommendations and monetary union requirements, leaving little to no room for national policy discretion. For that reason, she said, government does not believe an SER advice would add value in this specific legislative process.

She also said she is not planning to seek renewed advice from the Council of Advice. Gumbs explained that the draft laws were previously submitted to the Council of Advice and that the advice received was incorporated. She said it would be unusual to seek advice twice on the same draft proposal unless the substance of the legislation had changed significantly.

The Minister said St. Maarten and Curaçao remain autonomous countries, and legislation passed in one country does not automatically apply in the other. However, because both countries share a monetary union and one Central Bank, she said a high degree of legislative alignment is necessary. If one Parliament amends a uniform draft law differently from the other, she said, that could affect the functioning of the monetary union and would require consultation and coordination between both countries.

Gumbs said there is currently no fully established constitutional procedure to resolve such differences, and she supports the development of a clearer joint procedural framework for handling uniform legislation, including possible amendments.

Parliament also discussed the next steps in the legislative process. Follow-up questions on the draft law dealing with payment service providers are to be answered by the Minister in the government’s written report. For the remaining agenda points, including the draft laws on virtual asset service providers, oversight of payment or securities settlement systems and supervision of operators of financial market infrastructure systems, factions were asked to submit written questions by June 11.

Those questions are expected to be ratified in a Central Committee meeting before being formally sent to government. Gumbs concluded by thanking Parliament for the opportunity to respond and said she remained available to provide further clarification where needed. The discussion was based on the Minister’s responses and the parliamentary exchange contained in the provided transcript.

‍