Category: non-U.S. laws

Lost & Found: PA Webinar, IA Auction, Australia Amendments

Pennsylvania to Host Unclaimed Property Webinar — The Pennsylvania Treasury Department is hosting a free unclaimed property webinar on November 28th.  The Department will provide insight on identifying unclaimed property, reporting to the state, and how to develop effective policies and procedures.  There will also be a live Q&A session.  Registration information is available here.  The seminar also provides CLE credit for Pennsylvania attorneys.

Iowa to Auction Unclaimed Property — Add Iowa to the list of states offering to sell unclaimed property via auction.  Yesterday, the Iowa State Treasurer’s Office announced that it would run its first eBay unclaimed property auction from November 26th to December 3.  The auction is open to all US residents, and the items up for auction can be viewed here.

Australia Considers Unclaimed Property Law Changes — The Australian Parliament is considering a bill that will shorten the dormancy period for property held by banks and other financial institutions under the Banking Act of 1959.  A summary of the proposed legislation can be foundhere.

Kenya Finds Out that Administering Unclaimed Property Laws is Trickier Than it Seems

Kenya’s attempt to implement a U.S.-style unclaimed property law is well into its second year.  Kenya began the process of becoming the first African country with a custodial unclaimed property act of general application in Spring, 2011.  After considering the concerns of citizens and holders, the law was passed in December of 2011.

Notwithstanding the passage of more than 10 months from the law’s passage, Kenya’s government is finding out that the devil is in the details.  Now, according to an article on allafrica.com, the Kenyan Finance Ministry is having trouble staffing the entity that will be charged with administering the act — the Unclaimed Financial Assets Authority.  According to the article, the entity should be established soon.

Notably, the comments of Assistant Finance Minister Oburu Odinga make explicit something that most U.S. states try to downplay:  namely, that a significant rationale (if not the primary one) for unclaimed property laws is to raise money for the state.  The article quotes Odinga, as stating that the unclaimed property law “is a cheap way of raising money on our side rather than letting this money lie in the banks.”  Though the implementation of the act has taken longer than anticipated, at least the Kenyan Finance Ministry gets points for honesty.

An Update on the Kenyan Unclaimed Property Act

Last fall, we mentioned that Kenya was considering passing an unclaimed property law that was very similar in scope and application to unclaimed property laws in the United States.  That law was passed and went into effect on December 16, 2011.  A copy of it can be found here.  As a review of the law makes clear, the provisions of the Kenyan act appears to be very similar to those of the 1981 Uniform Unclaimed Property Act, only with a 2 year dormancy period for most property types.

Although the Kenyan Act just recently came into effect, its application could be significant.  According to a recent editorial in Business Daily Africa, commercial banks in Kenya are holding approximately 7.4 billion Kenyan Shillings ($88.8M US) in dormant assets. Like its U.S. counterpart, the Kenyan act requires holders to send written notice to apparent owners of unclaimed property, and requires annual reporting.  As the editorial makes clear, however, the Act is decidedly silent on what (if any) obligation the government has to notify apparent owners of unclaimed property, or even what happens to the funds collected by the government.

In other non-U.S. unclaimed property news, the Northern Mariana Islands passed its proposed unclaimed assets legislation.  The final act, which passed on February 6th, can be found here.  Also, according to an article in Benefits Canada, the draft budget of Ontario (Canada’s) minority government announced its intent to establish an official provincial unclaimed property program

Unclaimed Property News Roundup: From East to West

Delaware Raises Revenue Forecast – The State of Delaware’s earnings continue to outperform, according to Delaware Online, in no small part due to the state’s unclaimed property receipts.  According to the article, Delaware’s estimates were boosted by, among other things, a $10 million collection from a single holder.  The article also contains an ominous note from the deputy finance secretary, who was quoted as saying that the scope of unclaimed property audits are “increasing.”

Washington Securities Sale Measure Passes – Moving west:  a few weeks ago, we mentioned a Washington State proposal that would allow that state’s Division of Revenue to immediately liquidate securities received as unclaimed property (under the previous law, the state had to wait 3 years).  According to the Unclaimed Property Professionals Organization, that measure has passed.

Northern Mariana Islands Pass Unclaimed Property Law — Moving even further west, the Northern Mariana Islands, a U.S. Commonwealth in the South Pacific, has taken steps to pass an unclaimed property law..  According to the Saipan Tribune, the Commonwealth’s legislature recently passed a law that “allows the government to have access to dormant and inactive bank accounts and unclaimed funds.”  The bill is now pending with the Governor.

We will be taking off until next week.  Happy New Year!

Unclaimed Property in British Columbia, Canada

We’ve mentioned unclaimed property held in Canada before, but a recent article by James Kwantes in The Vancouver Sun has a good deal of information on unclaimed property held in the Canadian province of British Columbia (Canada, like the U.S., has a federal government, and unclaimed property is governed by the laws of each individual province).  The situation in British Columbia is quite unique in that a foundation – The British Columbia Unclaimed Property Society – not the government, has been administering the provincial unclaimed property program since 2003.

According to the article (which is well worth a read), the Society is currently holding over $90 million in funds, including some dating as far back as 1859 (even though BC did not become a province until 11 years later).

Kenyan Financial Institutions Express Concern Regarding Proposed Unclaimed Assets Law

As we’ve mentioned earlier, Kenya is considering adoption of an unclaimed property law that is very similar to the Uniform Unclaimed Property Act.  Not everyone is happy about this development.  According to an article in The Daily Nation, Kenyan banks and insurance companies are “alarmed” about several aspects of the law, including its potential retroactivity, and provisions allowing the government to sell unclaimed property to the highest bidder after three years.

Also of significant concern to the potential holders is an apparent conflict in Kenyan law that could result in companies continuing to be liable to owners of unclaimed property even after it has been reported and remitted to the government.  Although the proposed legislation does provide for indemnification of the holder (as do the U.S. uniform acts) the would-be holders seem to want greater assurance that they will not be subject to double liability.

International Unclaimed Property: Australia

From time to time, we provide information concerning “foreign” (i.e., non-U.S. unclaimed property laws).  Earlier articles have covered unclaimed property in the Cayman Islands, Jamaica, Kenya, and New Zealand.  Today, we continue our trip in the South Pacific by looking at unclaimed property in Australia. 

According to an article in this weekend’s Sydney Morning Herald, there are more than A$600 million in unclaimed financial accounts, and some A$1 billion in unclaimed shares held by Australian regulators, state governments, and transfer/exchange agencies.  In addition, the article indicates that there is much more in unclaimed “super” (i.e., retirement benefits), to the tune of A$13.6 billion, or $900 for each working-age Aussie.

The full article, complete with information on claiming funds from the applicable agencies can be found here.

Pending Legislation (in Africa) – Kenya Considers Unclaimed Property Law

Though it has its origins in ancient Rome and England, modern custodial unclaimed property laws (where the state takes possession of, but not title to, unclaimed property) are still primarily a U.S. phenomenon.  In the past several years, however, there has been a trend toward the establishment of such laws outside the U.S. (primarily in Europe and the Caribbean).  Now, however, it appears that modern unclaimed property laws may be gaining a foothold in Africa, as Kenya  is considering implementing a broad unclaimed property act.  Though the legislation is simply proposed at present, but would create a government entity to administer unclaimed funds, provide for a reporting and turnover process, and would allow owners to claim property held by the government.  Notably, the scope of the act would also be very broad, applying to bank deposits and nearly all forms of negotiable instruments.

A copy of the proposed legislation can be found here.

Based upon our quick review, we are not aware of any other countries in Africa that have unclaimed property laws.  If we’ve missed one, let us know here.

UPPO to Offer Foreign Unclaimed Property Webinar

Unclaimed property laws outside the U.S. have been a regular topic here for quite some time.  Those looking to bolster their knowledge and understanding of non-U.S. unclaimed property laws, and how U.S. laws deal with property owed to non-U.S. owners may want to check out the webinar below.

On May 26, 2011, the Unclaimed Property Professionals’ Organization is hosting a webinar on Foreign Unclaimed Property.  The webinar will cover the basics concerning the reporting and delivery of unclaimed property owed to non-U.S. holder, and provide information concerning the unclaimed property laws of jurisdictions outside the U.S.  (Full disclosure:  the author of this blog is one of the presenters).

The UPPO is probably the most well-known and active organization committed to representing the holders of unclaimed property.  Along with these webinars, the UPPO offers other educational information, networking events, contacts with state officials, and other invaluable opportunities for unclaimed property professionals.  Whether you are new to the field of unclaimed property and looking for help with the basics, or a seasoned veteran looking to expand your knowledge base and contacts, UPPO membership is highly recommended.

New Zealand Supreme Court Upholds Unclaimed Money Act

It is becoming more and more common that countries outside of the United States are enacting or implementing unclaimed property laws, or are enforcing pre-existing unclaimed property laws with new zeal (forshadowing pun intended).  Of course, along with such enforcement also comes controversies regarding the validity or scope of unclaimed property acts (generally, brought by the holder as a defense to a government’s claim).  Last week saw the end of one such controversy in New Zealand.

Last week, the Supreme Court of New Zealand upheld the validity of the 1971 Unclaimed Money Act, and ruled that the Act applied to certain foreign currency drafts issued by 3 New Zealand banks.  (See accompanying article about the lawsuit published on Stuff.co.nz).  Specifically, the banks argued that since the currency drafts were “presentment” items — that is, the banks’ liability to pay moneys under the drafts was conditional on the instruments being presented for payment — they had no obligation to pay until the condition was fulfilled, and hence no obligation to turn the underlying monies for unpresented drafts to the government as “unclaimed.”  The Suoreme Court rejected that argument.

In so doing, the Court followed precedent set in the 2004 case of Thomas Cook v. Inland Revenue, wherein the Privy Council (formerly the court of last resort for New Zealand and many other Commonwealth countries) upheld the validity of the 1971 Unclaimed Money Act against a similar challenge regarding presentment, noting that it was “nonsense” to argue, as the banks seemed to, that “money can only become unclaimed money once it has in fact been claimed.”