WILLEMSTAD - The Central Bank of Curaçao and Sint Maarten (CBCS) must prepare and substantiate the supervisory costs charged to the Social Insurance Bank (SVB) more carefully.
This was recently pronounced by the court in a ruling. It is explained that on the basis of the National Ordinance Basic Health Insurance (Lvbz) the CBCS is the supervisor of the basic health insurance fund (bvz) of which SVB is the administrator.
“The supervision costs passed on to the SVB by the Central Bank are insufficiently carefully prepared and substantiated. The bank is instructed to decide again on the objection against the decisions,” the ruling states in summary.
It is explained that by decision of 31 December 2020, the CBCS invoiced the SVB an amount of 39,500 guilders for supervision costs for the year 2019.
Nine months later, in September 2021, the bank declares the SVB's objection unfounded.
In addition, the CBCS sent a reminder to the SVB by letter dated 11 September 2020 for the payment of an amount of 196,500 guilders in supervision costs for the years 2012, 2015, 2016 and 2017. CBCS has been declared inadmissible.
The ruling explains the amount for 2019: “The bank has stated that it spent 158 hours on supervisory tasks in 2019. It multiplied that number of hours by an hourly rate of 250 guilders. The bank has taken the average hourly rate of (external) consultants as a starting point.”
The ruling explains that, according to the law, the supervisor must keep an overview of the activities performed in the context of the supervisory tasks. In addition, the supervisor advises on the policy pursued, including the investment policy of the social funds under supervision. But, the court ruled: “The bank has not provided any insight into how it has fulfilled its supervisory tasks in the context of the Lvbz. In view of the statutory provisions set out above and the passage from the Explanatory Memorandum, this would have been the right thing to do. After determining the fulfillment of its supervisory tasks, the bank should have kept an overview of the activities performed in the context of those tasks. Only then does the billing of the supervision costs come into the picture.”
At the hearing, the bank explained that it was not possible to determine its supervisory tasks because the SVB did not want to cooperate. However, the court states that the bank itself must fulfill its supervisory duties. "It is preferable to do this in consultation with the SVB, but if the SVB does not cooperate or cooperates insufficiently, as stated by the bank, it is up to the bank to unilaterally determine the interpretation of its supervisory tasks," said the bank. And: "Now that the bank has not taken any steps, the invoice with charged supervisory costs for 2019 has not been carefully prepared and insufficiently motivated."
With regard to the supervision costs for the years 2012, 2015, 2016 and 2017, the court notes that this is a reminder from the bank and that this is not a decision against which no objection can be made.
Incidentally, the court does not agree with the argument of the SVB that the CBCS is not a supervisor of the fund because two laws, the Lvbz and the National Ordinance Supervision Insurance Industry (LTV), are contradictory.
The judgment explains that the Lvbz applies and that the bank is the supervisor. “There is no question of a contradiction as stated by the SVB. Nor does it conflict with the principle of legality”, according to the verdict.