Domicile watch: May 2022

Jersey

JFSC increases investment business fees by 8.8%

Jersey Financial Services Commission (JFSC) has increased investment business fees by 8.8%, following its consultation on proposed changes, which took place in March.

According to the regulator, the fee increase aims to ensure JFSC is financially fit for the future. “This includes allowing us to continue to invest in evolving our technology platforms along with our people to ensure we are working as efficiently as possible,” JFSC stated.

To view the feedback on the consultation paper which led to the fee increase, click here.

JFSC consults on 11% funds business fee increase

JFSC has requested feedback from funds businesses regarding a proposed 11% increase to the sector’s fee rates.

The increase has been proposed due to the following:

- Headline fee rates are subject to a 5% increase above retail prices index (RPI) to compensate for changes JFSC is seeing in the funds sector. This is specifically a reduction in the number of asset pools and a small reduction in the number of funds service businesses.

- The Commission Law contemplates increases to fees in line with RPI, which was recorded as 6% in March 2022.

The deadline to send feedback is Friday 24 June 2022. Responses can be sent directly to JFSC at fscaccountsteam@jerseyfsc.org or Jersey Finance.

Once the consultation period closes, JFSC aims to publish feedback and the final fees notices in June 2022.

To view the consultation paper, click here.

Jersey amends limited partnership law

Jersey has amended its limited partnership law, with the aim of providing fund managers with greater flexibility in international fund structuring.

The amendments, which are expected to come into effect in Q3 2022, aim to modernise the jurisdiction’s regulatory framework, while taking into account trends and developments in international funds, globally.

Click here to view our full coverage. 

Guernsey

GFSC joins TNFD

Guernsey Financial Services Commission (GFSC) has become a member of the Taskforce on Nature-related Financial Disclosures (TNFD).

According to Gillian Browning, director investment, fiduciary and pension division at GFSC, the TNFD forum provides an opportunity to be better informed about the latest thinking and developments in nature-based disclosures. “The Forum will give us access to increased resources and expertise as we continue to develop our policy in this important area,” she said.

Guernsey records 855 domiciled investment funds in Q1 2022

According to new data, investment funds domiciled in Guernsey reached 855 in Q1 2022.

According to We Are Guernsey, this figure is the highest in almost a decade, after the jurisdiction reached 859 domiciled investment funds at the end of Q3 2012.

Statistics from GFSC found the net asset value of funds domiciled in Guernsey rose by £6bn (2%) during the quarter. This also equated to a £45.9bn increase over 12 months.

“At the end of 2021 we saw the NAV of funds pass £300bn for the first time,” commented Guernsey Finance CEO Rupert Pleasant. “We continue to see a consistent rise, which further confirms my previous statement that Guernsey demonstrates expertise, quality and innovation which are in high demand from global investors.”

Cayman Islands

TJN recognises Cayman’s transparency

Tax Justice Network (TJN) has improved its recognition of Cayman Islands in relation to its treatment of tax.

The recognition comes after Cayman Finance released a critical analysis of a report by the TJN in November 2021. At the time, Cayman Finance’s report found that TJN’s use of “distorted estimates and its failure to acknowledge the Cayman Islands’ tax neutrality and safeguards against tax evasion and tax avoidance resulted in a report that [was] unreliable in its conclusions about Cayman Islands financial services industry.”

Following this, TJN improved the methodology used for its Financial Secrecy Index (FSI) report. As a result, TJN’s 2022 FSI report found the greatest threat from financial secrecy comes from some of the largest onshore countries such as the US, Japan and Germany. At the same time, Cayman’s new transparency rating has identified the jurisdiction as more transparent than five G20 countries.

“TJN’s new report reflects some of the concerns previously raised by Cayman Finance and we look forward to continued improvements in TJN methodology and data so future reports can more accurately and credibly reflect the realities of global financial services,” commented Conor O’Dea, chair of Cayman Finance. “The Cayman Islands’ tax neutral regime is recognised internationally for its transparency and tax good governance principles thanks to strong collaboration by the Cayman Islands Government and the Cayman Islands financial services industry – and that work continues."