New rules for Directors’ Licences
for foreigners go into effect today
~ Expected to reduce abuse ~
PHILIPSBURG--Companies applying for Directors’ Licences for immigrant workers to operate on the island will have to abide by a set of new rules that go into effect today, Tuesday.
The new procedures, which were announced by Lt. Governor Franklyn Richards at a press conference on Monday, are intended to stamp out the rampant abuse of Directors’ Licences by some businesses that circumvent the system to obtain employment permits for their employees by applying for Director’s Licences. Richards spoke of some companies with tiny operations having two or three directors as prime examples of the abuse of the system.
The new procedures will mean that employers and applicants will have to submit additional documents to prove that the applicant will indeed serve in the function of director of a company.
The new policy will cover all new applications for Directors’ Licences, as well as those seeking renewals. Applications already in the system won’t be affected. Applications for renewals should be submitted at least three months prior to their expiration date. New applicants for Director’s Licences should be off-island while their requests are in.
Justice Minister David Dick and the Executive Council have already given the new policy the green light, Richards said.
“This new policy is aimed at putting an end to the misuse of the Director’s Licence and Business Licence to obtain a residence permit,” Richards said. “As you may already know, these kinds of misuse and abuse have been evident for some time by certain persons or groups to circumvent the law on admittance and expulsion and the procedure for securing employment, after which the process for obtaining a temporary residence permit would begin.”
He said the new policy was also another step aimed at synchronisation of the ordinances on admittance and expulsion and the ordinance on employment of non-nationals.
Some 500-700 requests are made for Directors’ Licences annually, but Richards could not say how many were estimated to be based on cases of abuse. He said requests meeting the requirements could not be turned down in the past, because government would have been exposing itself to lawsuits.
According to the new policy, a residence permit will only be considered for an immigrant applicant for a Director’s Licence once it has been proven that the business (NV/BV) can offer “a minimum added value to St. Maarten” and “what it will do for our economy – looking at aspects such as minimum capital injection, minimum percentage of employment for locals, and minimum annual turnover,” Richards said.
It must be proven that the business won’t be a burden for St. Maarten. The applicant, he said, must comply with the “profile of a director,” meaning that he or she must “earn a considerable salary and must ensure the compliance of the NV/BV regarding all its legal and fiscal obligations.”
In addition to the documents that are required in the former policy, the employer will also be required to submit proof that the non-national is able to provide for him- or herself “without becoming a burden to society.”
Therefore, employers will have to submit proof that the foreign director will earn a salary of at least 75,000 guilders per year or approximately 6,250 guilders gross per month (such as a labour agreement); a declaration of income tax supported by the annual figures of the company, plus a declaration of profit tax of the business in question.
Proof of payment for private health insurance for the non-national and proof that the director will have proper accommodations should also be provided. Richards said the accommodation should either be the director’s home located in St. Maarten, a home belonging to the company valued at a minimum of 275,000 guilders, or a home leased for at least 2,250 guilders per month. “Government expects to see proof of ownership of the home, or a lease agreement with regard to the home, valid for the duration of the licence.”
Proof should also be submitted that the company “anticipates an annual turnover” of at least 500,000 guilders. Proof that an agreement has been entered into with a recognised accountant office on the island regarding the making up of the annual returns and the submitting of profit tax of the business, as well as the declaration of income tax of the non-national director, should also be submitted.
The shareholder of the business should also apply for a CRIB number at the Inspectorate of Taxes for the director being applied for. The company in question as well as the director being applied for should also open bank accounts locally. A business plan should also be provided.
“It should be noted that a residence permit may be granted to the non-national director for the duration of one year only after all of the documentation … has been received, in full, at the Bureau of the Local Chief of Police (Sun Colour Building) (and after) the request has been processed, and the applicant and the non-national director have complied with all the rules and conditions,” Richards said.
In addition to the documents currently required for renewals, employers will also need to provide proof that the foreign director has suitable accommodations (an own home on St. Maarten, one owned by the company or a leased home to the tune of 2,250 guilders per month); proof of address (GEBE bills, TelEm bills, Cable TV bills); proof that the foreign director has a CRIB number or has requested one; proof of wage and income tax payment; and proof that the director is the holder of a local bank account.
Other documents that should be provided are a copy of a valid passport, a copy of the current residence permit, an original registration form from the Census Office, a copy of the marriage certificate/marriage book or divorce certificate (translated into English or Dutch) if applicable, and a five guilder stamp from the National Receiver’s Office.
Before the request for renewal of the permit of the foreign director is granted, the business should provide proof that it is still operational, proof that the applicant has been paid a gross salary of roughly 6,250 guilders per month, and the declaration of income tax, supported by the annual returns and declaration of profit tax of the business.
Proof of payment for health insurance for the foreign director and proof that he or she holds an account at a local bank are among other documents that should be provided.
The employer must also prove that its annual turnover is at least 500,000 guilders.
