The Income Tax (Substance Requirements) (Implementation) Regulations 2018, as amended, came into effect on 1 January 2019 and apply to accounting periods commencing on or after that date. The new economic substance requirements apply to certain Guernsey tax-resident companies and have been passed in order to comply with the EU Code of Conduct Group on Business Taxation for the purpose of demonstrating that the profits generated by Guernsey companies which carry on certain specified geographically mobile activities, including, in particular, for the purpose of this article, fund management business, are commensurate with their economic activities and substantial economic presence in Guernsey
The flexible and pragmatic approach adopted by the GFSC in relation to investment funds aimed at the institutional or high net worth investor market has helped the significant growth of this sector in Guernsey.
Nowadays, most funds formed in Guernsey tend to be for the institutional or high net worth individual markets, with hedge funds, funds of hedge funds, private equity and property funds being especially popular.
Guernsey is particularly keen to attract high quality hedge fund business. Following consultation with the industry, the GFSC released a guidance note in November 2003 setting out a more relaxed framework for the operation of hedge funds, which included waivers of the various fund rules in four key areas.
Guernsey has a thriving insurance linked securities (ILS) sector. As described in Carey Olsen's ILS briefing , Guernsey is home to an abundance of ILS structures
The European Securities and Markets Authority (ESMA) published on 19 July 2016 its final advice to the European Commission (the Commission) on the extension of the marketing passport under the Alternative Investment Fund Managers Directive (AIFMD) to 12 non-EEA countries, including the United States. This note is intended to highlight ESMA’s advice to the Commission and set out the steps firms would need to consider when applying for a third country passport.
Dominic Wheatley explains the island’s popularity as a destination for family offices. There is growing appreciation of the products and services that international finance centres such as Guernsey can provide to high-net-worth individuals, particularly as regards family office solutions.
It seems that change is the new norm in many areas of the financial services world, largely as a result of the current challenging economy in which legislation, regulation and risk management are all shaping the way in which we work and advise our clients.
The offshore world is no exception to this and there are a number of developments that are exercising family offices and their offshore providers or partners.
While not the first location that springs to mind when thinking of Islamic finance, Guernsey has developed its legal, tax and regulatory frameworks to a point where many Islamic players are now attracted to the island’s well-developed financial industry. John Richardson discusses the steps Guernsey is taking to encourage this trend.
The drift of funds from offshore jurisdictions to Ireland is continuing, with further asset managers announcing they are to take advantage of Ireland’s streamlined redomiciliation regime to move existing funds to Dublin.
A recent example was the Sarasin Guernsey fund range, which has been active in Guernsey for 20 years but recently announced that it is redomiciling to Ireland in order to enable the funds to be registered as UCITS.