Domicile watch: October 2020

Jersey

JFSC’s new digital registry

Jersey Financial Services Commission (JFSC)’s registry is going fully digital on 1 December.

The changes coincide with a new law that the Government of Jersey is introducing, which requires the regulator to collect more information for its central registers.

Key changes to note:

• JFSC is replacing the Easy Company Registry with myRegistry - a new customer account, enabling users to manage team access and portfolio of entities
• Replacing annual return process with an annual confirmation statement. It will be a read-only form detailing information held on the register at 1 January of the related year. The nominated person will declare on behalf of the entity, all information provided is accurate. The first annual confirmation statement is due between 1 January and 28 February 2021.

For more information on the new digital registry, click here.

JFSC appoints new commissioner

Jersey Financial Services Commission (JFSC) has appointed Matt Palmer as commissioner on the board. He will serve a five-year term.

Palmer is an experienced audit committee chair and a chartered accountant. He specialises in risk management, with a focus on operations, technology and cyber security risks.

In addition to his role at JFSC, Palmer is a board adviser to fintech startup Appital and risk management solution firm Risk Ledger. He previously worked at Willis Towers Watson as a senior director - new software & advisory service proposition, investment firm Brevan Howard as chief information security officer (CISO) and State Street as divisional CISO, alternative investment services.

JFA elects new committee

Jersey Funds Association elected its new committee for the upcoming year at its AGM.

New committee members are as follows: Richard Anthony, Mike Byrne, Steve Cartwright, Ben Dixon, Mark Grenyer, Ben Honeywood, Niamh Lalor, Dilmun Leach, Chris Marshall, Robert Milner, Simon Page, Martin Paul, Tom Powell, Peter Rioda, Ben Robins, Martin Rowley and Sarah Sandiford

Additionally, Tim Morgan and Michael Johnson will remain chair and vice chair, respectively.

“I’m pleased to welcome some new faces to help drive forward our plans for the coming year across our legal and technical, education and training and communications remit,” said Morgan. “In particular, I’m delighted that Tom Powell will be leading a new group for us to coordinate a strategy around ESG, an area that is now a fundamental part of our overall proposition as a jurisdiction.”

Guernsey

US LPs invest £43.6bn into Guernsey-domiciled funds

US investors invested a total of £43.6bn into Guernsey-domiciled funds, in mid-2019, according to new research by Guernsey’s government.

Of that total, more than £33bn was invested globally, particularly in Europe.

The research also found that the net asset value of Guernsey-domiciled funds under management reached £227.7bn, during the same time period.

According to Rupert Pleasant, CEO of Guernsey Finance, the jurisdiction has proved to be a simple route for US investors to access European and UK markets, via the time zone, range of structures and the national private placement regime.

“Some 95% of all investment from the US into Guernsey funds goes into private equity, which is by far the largest share going into the sector from any single jurisdiction,” he said. “Our industry has regularly cited the US as an attractive potential market for further growth, given the scale of investments sourced there, and it will continue to be an increasingly important part of our funds sector’s investor base.” 

No place like home: domicile webinar

The Drawdown recently hosted a webinar with WE ARE GUERNSEY to explore the key considerations for selecting the right domicile, including economic substance requirements, and of course Brexit.

Speakers on the panel included: 

• Stephen Branagan, head of Ireland/global head of operations at Pantheon
• Kate Storey, partner at Walkers
• Andrew Maiden, director – fund administration services at Intertrust Guernsey

Click here to find out more and watch the webinar.

Ireland

Ireland approves limited partnership reform

The Irish government has approved the Investment Limited Partnerships (Amendment) Bill 2020.

Ireland’s previous Investment Limited Partnership Act was updated in 1994. This amended legislation aims to modernise the Act, by aligning it with more recent domestic and EU laws. This includes the Companies Act 2014 and the EU’s AIFMD, which came into force in 2011.

According to minister for finance, Paschal Donohoe, the publication of this bill fulfils a commitment made in the Programme for Government to progress the revision of the original structure to ensure the same levels of transparency and beneficial ownership apply across all of Ireland’s funds.

“The importance attached to the Bill as a means to promote investment and Ireland’s competitiveness and sound regulatory environment in international financial services is more acute in the wake of the economic impact caused by Covid-19’.” 

Luxembourg

Covid-19 substance requirements extension update

The Grand Duchy of Luxembourg has passed a new law to extend the possibility to hold board and shareholder meetings remotely up to and including 31 December 2020.

According to Bertrand Géradin (partner) and Sinéad Mannion (associate) at Ogier, a company that holds a general meeting by videoconference or passes written resolutions when the articles of association do not permit so, risks exposing its directors or managers to liability for violation of the articles of association or the law.

Article 1 of the new law allows the continuation of more flexibility regarding corporate governance. It enables companies to hold their meetings in the following ways:

• Voting forms in writing / electronic format
• Boxy holder
• Exclusively digitally by video conference or any other telecommunication means identifying the individual.

DAC6 reporting deadlines extensions

According to Johan Terblanche, Marjorie Allo and Baptiste Aubry of Maples Group, the Luxembourg Parliament voted to approve reporting extensions in light of Covid-19:

• Reportable cross-border arrangements implemented between 25 June 2018 and 30 June 2020 must be reported by 28 February 2021 (six months after the original deadline 31 August 2020)
• Reportable cross-border arrangements occurring between 1 July and 31 December 2020 should now be disclosed within 30 days as from 1 January 2021
• Reportable cross-border arrangements, occurring on or after 1 January 2021, should be disclosed within a 30-day period

For more information on legal updates/issues in 2020 for private equity in Luxembourg, click here.

Cayman Islands

Cayman Islands removed from EU blacklist

Cayman Islands has been removed from the EU’s blacklist of non-co-operative jurisdictions for tax purposes.

The domicile has now adopted necessary reforms to its tax policy framework on collective investment funds in September.

A note from the general secretary of the EU Council stated: “The Group examined this issue at its meetings on 15 July and 7 September and concluded on 21 September 2020 that Cayman Islands has delivered on its commitment on criterion 2.2 and can be removed from Annex I.”

According to Nick Bullmore, Cayman Islands managing partner at law firm Carey Olsen, the Cayman Islands’ government has been actively engaging with the EU ever since their surprise decision to place the Cayman Islands on the EU Blacklist earlier this year. “We were confident the blacklisting would be temporary given the Cayman Islands’ continuing commitment to meet all appropriate global tax, transparency and governance standards.”