(a) An Off-shore Financing Corporation is an entity incorporated in Guam other than an International Finance Company whose principal purpose is:

(1) negotiating, making and extending loans to borrowers who are not residents or citizens of Guam; and

(2) borrowing from lenders who are not residents or citizens of Guam. An Off-shore Financing Corporation shall record in Guam, for accounting purposes, all its loans, borrowing and business transactions. An Off-shore Financing Corporation shall not transact business as a bank within the territory of Guam.

(b) Before any person or entity may operate an Off-shore Financing Corporation in Guam, a written license authorized by the Banking and Insurance Board and issued by the Commissioner shall be obtained.

(c) An Off-shore Financing Corporation license shall be issued after the applicant has met the following requirements:

(1) It is duly incorporated under the laws of the territory of Guam and is authorized by its articles of incorporation to transact the type of business described in Subsection (a) of this Section.

(2) It has filed with, the Banking and Insurance Board a certified copy of its articles of incorporation and of its bylaws and a copy of an application for a commercial license as a lending institution pursuant to §§ 72104 and 72105 of this Code.

(3) It has furnished to the Banking and Insurance Board such proof of its paid-in capital, stock ownership and management as the Banking and Insurance Board may reasonably require.

(4) It has complied with all applicable requirements of the title
18 Guam Code Ann. relating to domestic corporations, except matters specifically otherwise provided for in this Section.

(5) Its manager or agent residing in this Territory has taken an oath that he will, as far as the duty devolves upon him, diligently and honestly administer the affairs of the corporation and will not knowingly violate or wilfully permit to be violated any of the provisions of law applicable to the corporation and the oath, subscribed by the manager or agent taking it, has been transmitted to the Commissioner and filed in his office.

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(6) It has received from the License Board of the department a commercial license in accordance with § 72103 of this Code.

(d) The license issued pursuant to this Subsection shall be for a term of five (5) years renewable for term of five (5) years. The license fee for each five (5) year license period shall be One Thousand Dollars ($1,000) payable at the time an application for licensure is filed with the Commis- sioner. If the license is not issued, the one Thousand dollars ($1,000) fee shall be refunded to the applicant.

(e) Interest earned by an Off-shore Financing Corporation duly licensed under this Section through its operations shall not be treated for the purposes of § 26201 of Title 11, Guam Code Ann. as income from business activities in Guam.

(f) Each Off-shore Financing Corporation shall submit to the Banking and Insurance Board twice in each calendar year a report of its condition as of such dates as the Board may fix. Such reports shall contain such information as the Banking and Insurance Board may reasonably require to ascertain whether or not the Off-shore Financing Corporation is being operated in accordance with this Section. The record of an Off-shore Financing Corporation concerning transaction between an Off-shore Financing Corporation and its individual customers shall be confidential and an Off-shore Financing Corporation is prohibited from furnishing to third parties record of any individual transaction between the Off-shore Financing Corporation and any of its borrowers, lenders or other customers except upon court order, subpoena, other judicial process or the express consent, of the parties involved. No process shall require disclosure sooner than fifteen (15) days from the date of service of such process upon the Off-shore Financing Corporation.

(g) In the event a court of competent jurisdiction shall in any respect hold invalid any provision contained in this Section. such invalidity shall not affect or impair any other provisions of this Section. Upon a holding of invalidity, this Section shall be construed as if the invalid provision had never been contained herein.

(h) As used in this Section, International Finance Company shall mean any company;

(1) which is not an investment company;

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(2) which derives at least fifty percent (50%) of its annual gross income as interest or similar fees or revenue from any of its stock- holders or any affiliate of its stockholders or any person responsible for the existence of such stockholder relationship; and

(3) which either:

(A) has outstanding obligations with an original maturity date of longer than one (1) year in a principal amount greater than its capital;

(B) which holds, as assets, obligations of any one debtor (including, for this purpose, obligations of all other entities which are under common ownership control with a debtor) equal to an amount greater than such company’s capital; or

(C) which has at least fifty percent (50%) of its obligations guaranteed as to principal or interest by any one or more of its debtors or convertible into the securities of any one or more of its debtors.

SOURCE: GC § 30904. Added by P.L. 16-065:1.

2011 NOTE: References to the “”Banking Board”” changed to “”Banking and
Insurance Board”” pursuant to P.L. 27-088:10 (May 6, 2004).

2013 NOTE: Pursuant the authority granted by 1 Guam Code Ann. § 1606, numbers and/or letters in subsections (a) and (h)(3) were altered to adhere to the Compiler’s alpha- numeric scheme.

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ARTICLE 7
FOREIGN BANKING CORPORATION

Part A. Definitions.
Part B. Transaction of Business.
Part C. Representation Without Transaction of Business.

PART A DEFINITIONS