UK DTCs and TIEAs - negotiating priorities for the year to March 2010 and report on recent developments

The Financial Secretary, Stephen Timms MP, has announced details of the UK’s treaty negotiating priorities for the year to 31 March 2010.

Details

The Government reviews the UK’s Double Taxation Convention (DTC) priorities each year to ensure that the treaty network continues to meet the needs of the businesses and individuals receiving income from abroad. The Government also has an ongoing programme of Tax Information Exchange Agreement (TIEA) negotiations with jurisdictions that have committed to implement the international tax standard of transparency and exchange of information for tax purposes. HM Revenue & Customs monitors the DTC networks of other countries and invites representations from business, individuals, representative bodies, other Government departments and others with an interest in this area. We use the results, balanced with an estimate of the resources available, to produce a schedule of work for the year ahead.

Programme to 31 March 2010

We plan to take forward work on new DTCs with Australia, Austria, Belgium, the British Virgin Islands, the Cayman Islands, Croatia, Ethiopia, Germany, Hungary, Israel, Luxembourg, New Zealand, Oman, Qatar, Spain, Switzerland and Thailand.

We also plan to take forward work on TIEAs with Anguilla, Gibraltar and the Turks & Caicos Islands.

Recent developments

The DTC between the UK and the Kingdom of Saudi Arabia, signed in London on 31 October 2007, entered into force on 1 January 2009. The text has been published as the Schedule to the Double Taxation Relief and International Tax Enforcement (Taxes on Income and Capital) (Saudi Arabia) Order 2008 (Statutory Instrument 2008 No. 1770). The text of the Order can also be accessed on the Internet at: The Double Taxation Relief and International Tax Enforcement (Taxes on Income and Capital) (Saudi Arabia) Order 2008 (PDF 1.1MB) (Opens new window)

In the UK the provisions of the Convention will take effect from 1 April 2010 for Corporation Tax purposes and from 6 April 2010 for Income Tax and Capital Gains Tax purposes. In Saudi Arabia the provisions will take effect from 1 January 2010.

The DTC between the UK and the Republic of Slovenia, signed in London on 13 November 2007, entered into force on 11 September 2008. The text has been published as the Schedule to the Double Taxation Relief and International Tax Enforcement (Taxes on Income and Capital) (Slovenia) Order 2008 (Statutory Instrument 2008 No. 1796). The text of the Order can also be accessed on the Internet at: The Double Taxation Relief and International Tax Enforcement (Taxes on Income and Capital) (Slovenia) Order 2008 (PDF 1.21MB) (Opens new window)

In the UK the provisions of the Convention took effect from 1 April 2009 for Corporation Tax purposes and from 6 April 2009 for Income Tax and Capital Gains Tax purposes. In Slovenia, the provisions took effect from 1 January 2009.

A DTC between the UK and the Republic of Moldova, signed in London on 8 November 2007, entered into force on 30 October 2008. The text has been published as the Schedule to The Double Taxation Relief and International Tax Enforcement (Taxes on Income and Capital) (Moldova) Order 2008 (Statutory Instrument 2008 No. 1795). The text of the Order can be accessed on the Internet at: The Double Taxation Relief and International Tax Enforcement (Taxes on Income and Capital) (Moldova) Order 2008 (PDF 1.13MB) (Opens new window)

In the UK the provisions of the Convention took effect from 1 April 2009 for Corporation Tax purposes and from 6 April 2009 for Income Tax and Capital Gains Tax purposes. In Moldova, the provisions took effect from 1 January 2009.

A Protocol to the DTC between the UK and Switzerland, signed in London on 26 June 2007, entered into force on 22 December 2008. The text has been published as the Schedule to The Double Taxation Relief and International Tax Enforcement (Taxes on Income) (Switzerland) Order 2007 (Statutory Instrument 2007 No 3465). The text of the Order can be accessed on the Internet at: The Double Taxation Relief (Taxes on Income) (Switzerland) Order 2007 (PDF 582K) (Opens new window)

The provisions took effect from the dates set out in Article XIV of the Protocol.

A Protocol to the DTC between the UK and New Zealand, signed in London on 7 November 2007, entered into force on 28 August 2008. The text has been published as the Schedule to The Double Taxation Relief and International Tax Enforcement (Taxes on Income and Capital) (New Zealand) Order 2008 (Statutory Instrument 2008 No. 1793). The text of the Order can also be accessed on the Internet at: The Double Taxation Relief and International Tax Enforcement (Taxes on Income and Capital) (New Zealand) Order 2008 (PDF 242K) (Opens new window)

The provisions of the Protocol took effect in both the UK and New Zealand from 28 August 2008.

A TIEA between the UK and the Overseas Territory of Bermuda, signed in London on 4 December 2007, entered into force on 10 November 2008. The text has been published as the Schedule to The International Tax Enforcement (Bermuda) Order 2008 (Statutory Instrument 2008 No1789). The text of the Order can also be accessed on the Internet at: The International Tax Enforcement (Bermuda) Order 2008 (PDF 780K) (Opens new window)

In the UK and Bermuda the provisions of the Agreement took effect from 4 December 2008 .

A TIEA and an Arrangement amending the 1955 Double Taxation Arrangement between the UK and the Isle of Man, signed in Douglas on 29 September 2008, entered into force on 2 April 2009. The text has been published as the Schedule to The Double Taxation Relief and International Tax Enforcement (Taxes on Income and Capital) (Isle of Man) Order 2009 (Statutory Instrument 2009 No 228). The text of the Order can also be accessed on the Internet at: The Double Taxation Relief and International Tax Enforcement (Taxes on Income and Capital) (Isle of Man) Order 2009 (PDF 638K) (Opens new window)

The provisions of the TIEA took effect in the UK and the Isle of Man from 2 April 2009. The provisions of the Arrangement took effect in the Isle of Man from 6 April 2009 and are effective in the UK from 6 April 2009 for Income Tax purposes and 1 April 2010 for the purposes of Corporation Tax.

Agreements were also signed with the following countries. The texts of these agreements are also available on the Internet as detailed below.

Netherlands (Double Taxation Convention and Protocol signed on 26 September 2008)
The Double Taxation Relief and International Tax Enforcement (Taxes on Income and Capital) (Netherlands) Order 2009 (PDF 1.58MB) (Opens new window)

France (Double Taxation Convention signed on 19 June 2008)The Double Taxation Relief and International Tax Enforcement (Taxes on Income and Capital) (France) Order 2009 (PDF 1.5MB) (Opens new window)

Libya (Double Taxation Convention signed on 17 November 2008)UK/Libya Double Taxation Convention (PDF 140K)

Mexico (Protocol to the Double Taxation Convention signed on 23 April 2009)Protocol to UK/Mexico Double Taxation Convention (PDF 46K)

Cayman Islands (Double Taxation Arrangement signed on 15 June 2009)Double Taxation Arrangement (PDF 49K)

A tax information exchange agreement and an agreement for the avoidance of double taxation of individuals, between the governments of the UK and the British Virgin Islands were signed in London on 29 October 2008. The text of the agreements may be accessed on the internet at http://www.hmrc.gov.uk/international/bvi-eol.pdf (PDF 69K) and on 17 June 2009 was laid as a Schedule to a draft Order in Council for consideration by the House of Commons.

A Tax Information Exchange Agreement and an arrangement amending the 1952 Double Taxation Arrangement between the UK and Jersey were signed in London on 10 March 2009. The text of the agreement and the arrangement may be accessed on the HMRC website at: Tax Information Exchange Agreement and an arrangement amending the 1952 Double Taxation Arrangement between the UK and Jersey (PDF 80K) and on 17 June 2009 was laid as a Schedule to a draft Order in Council for consideration by the House of Commons.

A Tax Information Exchange Agreement and an arrangement amending the 1952 Double Taxation Arrangement between the UK and Guernsey were signed in London on 20 January 2009. The text of the agreement and the arrangement may be accessed on the internet at Tax Information Exchange Agreement and an arrangement amending the 1952 Double Taxation Arrangement between the UK and Guernsey (PDF 57K) and on 17 June 2009 was laid as a Schedule to a draft Order in Council for consideration by the House of Commons.

Lord Turner appointed chair of FSB's Standing Committee for Supervisory and Regulatory Co-operation

The Financial Services Authority (FSA) chairman, Adair Turner, has been appointed chairman of the Financial Stability Board's Standing Committee for Supervisory and Regulatory Co-operation.

The Financial Stability Board (FSB) was re-established in April 2009 as the successor to the Financial Stability Forum (FSF). It brings together national authorities responsible for financial stability in significant international financial centres, international financial institutions, sector-specific international groupings of regulators and supervisors, and committees of central bank experts.

Lord Turner said:

"The global nature of the financial crisis and the fact that so many banking groups operate across national borders make international co-operation a vital part of reforming regulation. We will work hard on this committee to define the regulations and supervisory approaches needed to address these global risks and identify priorities for regulatory policy needed to tackle them."

The Standing Committee for Supervisory and Regulatory Co-operation will address coordination issues that arise among supervisors and regulators. It will also help with contingency planning for cross-border crisis management at major financial institutions and advise on crisis management issues more broadly.

Appleby Opens New Office in Seychelles Focussed on Emerging Markets in Africa, India & Asia

Appleby, the leading global offshore legal, fiduciary and administration service provider, has opened an office in the Republic of Seychelles. Appleby is the first international law firm to open in the country and the new office provides clients with greater access to the fast-growing emerging markets in Africa, Asia and India. The office is located in the Seychelles’ capital Victoria.

Appleby recently announced its merger with law firm Dickinson Cruickshank in the Isle of Man, which will create the world’s largest offshore law firm by partner numbers. The firm will have ten offices in key offshore and major financial centres worldwide and a total staff of over 800 including 73 partners.

Malcolm Moller, Managing Partner of Appleby’s Mauritius office, played a key role in establishing the office, and will serve as the Managing Partner in the Seychelles. The firm’s incorporated entity in the Seychelles, Appleby Corporate Services (Seychelles) Limited, will offer corporate and trust administration services.

The firm has also announced that Conrad Benoiton, Chairman of the Seychelles International Business Authority, Director General – Securities and Financial Markets, Central Bank of Seychelles and the former Executive Chairman and Director of Air Seychelles, will become Managing Director of Appleby Corporate Services (Seychelles) Limited. Mr. Benoiton is credited with the creation of the Seychelles first regulatory body SIBA, in 1995. In addition the new office will be staffed by two further lawyers and a support team.

The office will focus on investment into the emerging African, Asian and Indian markets. Institutional clients are looking to establish efficient investment structures created through a well-placed, independent sovereign country with a network of double taxation treaties. The Seychelles, with a population of 85,000, has a highly literate English and French speaking workforce and created the first regulatory body for its offshore industry in 1995, the Seychelles International Business Authority (SIBA). Whilst tourism and fisheries are the mainstay of the Seychelles economy, SIBA has successfully established the foundation for an international financial centre which both diversifies the economic base and stimulates inward investment. The Seychelles has entered into 11 double taxation treaties, including with China and Indonesia, and is on the OECD “white list”.

Commenting on the new office Malcolm Moller said: “This is a significant opportunity for both Appleby and the Seychelles as we will offer world-class legal, fiduciary and administration services from the Seychelles to international clients and to businesses based in the islands. We believe our presence in this fast growing jurisdiction will complement our Mauritius office and, as the first international law firm to open here, we will be well positioned to offer our clients sophisticated offshore services for investment in the African, Asian and Indian markets. In addition, our global resources and reputation will further assist the growth of international business in the Seychelles.”

Peter Bubenzer, Appleby’s Global Group Managing Partner concludes: “Our driving strategy has been to be the leading provider of legal, fiduciary and administration services in the offshore world. Our entry into the Seychelles market further builds our unique strength and depth across multiple jurisdictions — providing greater resources and choice to our clients. In particular, our two offices in the Indian Ocean offer unique access to emerging markets and reinforce Appleby’s position as the first choice for clients in the offshore sector.”

Financial Stability Board holds inaugural meeting in Basel

The Financial Stability Board (FSB) held its inaugural meeting in Basel on 26-27 June. This was the first meeting since the Financial Stability Forum (FSF) was re-established as the FSB with an expanded membership and a broader mandate to promote financial stability.
The FSB’s mandate is to assess vulnerabilities affecting the financial system; identify and oversee action needed to address them; promote coordination and information exchange among authorities responsible for financial stability; monitor and advise on market developments and their implications for regulatory policy; advise on and monitor best practice in meeting regulatory standards; undertake joint strategic reviews of the policy development work of the international standards setting bodies; set guidelines for and support the establishment of supervisory colleges; manage contingency planning for cross-border crisis management; and collaborate with the International Monetary Fund (IMF) to conduct Early Warning Exercises.
The FSB set up the internal structures needed to fulfill this mandate. It also discussed risks and challenges facing financial systems and progress in implementing prior FSF/FSB and G20 recommendations.
Institutional structures of the FSB
The new structures of the FSB include, in addition to the FSB Plenary,a Steering Committee and three Standing Committees – for Vulnerabilities Assessment; Supervisory and Regulatory Cooperation; and Standards Implementation.
The Steering Committee will be chaired by the FSB Chair and will provide operational guidance between Plenary meetings to carry forward the directions of the FSB.
The Standing Committee for Vulnerabilities Assessment will assess and monitor vulnerabilities in the financial system and propose to the FSB actions needed to address them. Its findings will be the basis for the FSB’s vulnerabilities deliberations, and will provide input for the Early Warning Exercises. It will be chaired by Jaime Caruana, General Manager of the Bank for International Settlements.
The Standing Committee for Supervisory and Regulatory Cooperation will address coordination issues that arise among supervisors and regulators, and will raise any need for policy development that arises in this regard. It will set guidelines for and oversee the establishment and effective functioning of supervisory colleges, and will monitor and advise on best practice in meeting regulatory standards with a view to ensure consistency, cooperation and a level playing field across jurisdictions. It will maintain a link with work on contingency planning for cross-border crisis management at major financial institutions and advise on crisis management issues more broadly. Adair Turner, Chairman of the UK Financial Services Authority, will chair the Committee.
The Standing Committee for Standards Implementation will prepare the FSB’s planned peer reviews of its members, which are an obligation of membership; and will report on members’ commitments and progress in implementing international financial standards and other initiatives. More broadly, the Committee will propose a framework and discuss progress in strengthening adherence to prudential regulatory and supervisory standards by relevant jurisdictions. Tiff Macklem, Associate Deputy Minister of the Department of Finance of Canada, will chair this Committee.
To take forward earlier FSF work on cross-border crisis management, the FSB also established a Cross-border Crisis Management Working Group under the Standing Committee for Supervisory and Regulatory Cooperation. The Working Group, chaired by Paul Tucker, Deputy Governor of the Bank of England, will work to provide a framework to implement the FSF Principles for Cross-border Cooperation on Crisis Management.
Financial system risks and responses
The FSB noted signs of improvement in the global macroeconomic outlook and in some financial markets, especially funding markets. Banks have raised capital from the private sector, but the process of restructuring and strengthening bank balance sheets is not yet completed. Corporate bond markets continue to see strong primary issuance, but other credit channels, including bank lending and securitisation, will need to be strengthened in order to support a sustained recovery. It will thus be important for authorities to follow through in implementing policies to resolve problems in financial systems and strengthen systemic resilience, so that the recent positive signs can be translated into sustainable growth.
The FSB agreed on the need to develop and consult with each other on plans for exit strategies from the financial system policies put in place in response to the crisis, although these should only be implemented once conditions are suitable.
FSB members shared experiences with regulatory stress tests performed recently or planned for their financial sectors. While the formats and objectives of these tests have necessarily varied in response to local conditions and challenges, they are proving to be effective tools for assessing resilience of institutions and the financial system. Members agreed to continue exchanging information on the assumptions and methodologies used in formulating and implementing the tests.
Progress in work to strengthen financial systems
The FSB took stock of progress in implementing FSF/FSB and G20 recommendations. These include work on strengthening international accounting standards; developing a macroprudential approach to financial supervision and regulation; reviewing the scope of financial regulation, including oversight for hedge funds and credit rating agencies (CRAs); enhancing adherence to international supervisory and regulatory standards; supervisory colleges; cross-border crisis management; and sound compensation practices.
The FSB welcomed the significant progress made since April and encouraged continued efforts to meet the objectives of strengthening financial systems:
• The International Accounting Standards Board (IASB) has accelerated its work programme to respond to issues and recommendations identified by the FSB, the G20 and others, including plans to issue proposals in 2009 to improve and simplify the accounting for financial instruments, loan loss provisioning and hedge accounting. The IASB indicated that the changes to simplify and address impairment in certain financial assets would be decided by the IASB in time to be implemented for the 2009 annual accounts. The FSB stressed the need to achieve convergence of accounting standards and take into account their procyclicality effects, and encouraged the IASB to explore ways to further enhance its technical dialogue with prudential authorities, market regulators and other stakeholders on financial institution reporting issues.
• The FSB reviewed progress in developing tools to adopt a macroprudential approach to regulation and supervision. In particular, the Basel Committee on Banking Supervision (BCBS) will make an integrated proposal to strengthen the capital and liquidity regime by end-2009, which will include requirements to address procyclicality and systemic risk.
• The FSB welcomed the publication by the International Organization of Securities Commissions (IOSCO) of Principles for Hedge Funds Regulation, and work by the Joint Forum on hedge funds oversight from a prudential and financial stability perspective. The FSB stressed the need for coherent national implementation.
• The FSB welcomed the IOSCO work to develop recommendations on regulatory approaches to securitisation and credit default swap markets. It looked forward to publication of the final IOSCO report in September 2009.
• National and regional initiatives are ongoing to strengthen oversight of CRAs. The FSB will continue to work to ensure a globally consistent approach to oversight and regulation of CRAs, together with its members.
• The FSB looked forward to the outcome later this year of work by the Joint Forum to analyse regulatory gaps and propose solutions, in order to ensure that the nature and scope of regulation across banking, insurance and securities markets are appropriate and consistent.
• The FSB discussed a mechanism to promote a race to the top in implementation of international supervisory and regulatory standards. It will develop the details in the design of this program ahead of the Pittsburgh Summit in September 2009.
• The FSB discussed efforts underway and next steps in its work on supervisory colleges and set work in train to promote consistency in approaches and identify best practices.
• The FSB welcomed the Core Principles for Effective Deposit Insurance Systems recently issued by the International Association of Deposit Insurers (IADI) and the BCBS. Work is underway between IADI and the IMF and World Bank to develop an assessment methodology for these Core Principles.
• The FSB welcomed national initiatives and work by the BCBS and IOSCO to incorporate the FSF Principles for Sound Compensation Practices in their supervisory and disclosure guidance, and stressed the need for consistent implementation across jurisdictions.
The FSB will continue to monitor progress in implementing the G20 London Summit recommendations and provide a report to the G20 Finance Ministers and Central Bank Governors meeting in November 2009. It will also report on progress to the G20 Ministers and Governors and to the Pittsburgh Summit in September 2009.

Appleby is First Foreign Law Firm Licensed to Practice Local and International Law in Mauritius

Appleby, the leading global offshore legal, fiduciary and administration service provider, has announced that its Mauritius office has become the first joint venture law firm to be registered to practice local and international law on the island. The registration is under the new Law Practitioners (Amendment) Act 2008 and the Law Practitioners (Registration of Law Firms, Foreign Law Firms, Joint Law Ventures and Foreign Lawyers) Regulations 2008. The joint venture firm will operate under the name of Appleby.

Appleby is the first foreign law firm to have successfully set up office and be registered to practice both Mauritius and foreign law and is licensed to appear before all local courts and tribunals.

Appleby opened it office in Mauritius in February 2007 to focus on investment into the fast-growing emerging markets in Africa, Asia and India to meet the needs of institutional clients in North America, Europe and Asia.

The new laws are designed to regulate the setting up, registration and functioning of domestic law firms, foreign law firms, joint law ventures and foreign lawyers in Mauritius and, to provide a framework for the regulation and practice of foreign and international law in Mauritius. The legislation confirms the long standing intention of the Mauritian Government to encourage international legal services and consolidate the island’s position as a major financial and legal services centre in the region.

As the island’s first registered joint venture law firm, Appleby will continue to work closely with the Government and financial services authorities to raise awareness worldwide of the significant opportunities for investors in the jurisdiction.

Mauritius office managing partner Malcolm Moller, one of the newly registered foreign lawyers under Law Practitioners Act 1984 said: “We believe that, as a global offshore services provider, Appleby’s presence in Mauritius is not only an invaluable resource for our clients, but will also provide a significant boost to the island’s capabilities, status and reputation in the international offshore sector. Appleby’s global reach in the key offshore jurisdictions, its recent expansion into the Seychelles strengthening our position with the emerging markets in India, Africa and Asia, and our market leading position in international financial centres, will have a major impact on the breadth, range and choice of services we are able to offer to our local and international clients.”

IASB seeks input on feasibility of expected loss model

The International Accounting Standards Board (IASB) today published a Request for Information on the feasibility of an expected loss model for the impairment of financial assets. Impairment is one of the issues that the IASB is addressing in the second phase of its comprehensive review of IAS 39 Financial Instruments: Recognition and Measurement.

The Request published today seeks input on the practical issues that would arise, if an expected loss model was required. The input will assist the IASB in developing formal proposals that it plans to publish in an exposure draft in October 2009.

The current model in IAS 39 requires an entity to account for credit losses in financial assets only if an event (or a combination of events) has occurred that has a negative effect on future cash flows and that effect can be reliably estimated (this is known as the incurred loss model). A feature of that model is that an entity is not permitted to consider the effects of future expected losses. The financial crisis has highlighted this as an area of concern. Responding to the request of the G20 leaders and others the IASB is reviewing that approach and examining the expected loss model as an alternative.

The expected loss model requires an entity to make an ongoing assessment of expected credit losses, which may require earlier recognition of credit losses. This would better reflect the way that financial assets are priced and the way some companies manage their business.

The IASB welcomes responses to its Request for Information by 1 September 2009.

View the Request for Information

CCFD-Terre Solidaire: Biens mal acquis - A qui profite le crime?

Quand on parle « Biens mal acquis », on pense au patrimoine d’Omar Bongo, Denis Sassou Nguesso... Les procédures judiciaires nées en France de notre étude de 2007 sont passées par là.

Après une enquête minutieuse, le CCFD-Terre Solidaire sort un rapport actualisé « Biens mal acquis, à qui profite le crime ? ». Il passe en revue les avoirs détournés de plus de 30 dirigeants de pays en développement : plus de 100 milliards de dollars, autant d’argent qui ne sera pas investi dans la santé, l’éducation, l’agriculture... A ce jour, les pays riches n’en ont restitué que 1 à 4 % aux populations volées. Et ce, en dépit de leurs promesses répétées de lutter contre la corruption.

Pourquoi ? C’est la question centrale du rapport. En cause, l’hypocrisie des pays du Nord, les paradis fiscaux et judiciaires, les prêts à des régimes corrompus, le pillage des richesses...

Télécharger le rapport intégral

Télécharger la synthèse du rapport

AIMA Welcomes de Larosiere, Turner, Myners, Sassoon Comments on Draft Directive

The Alternative Investment Management Association (AIMA) – the global hedge fund industry association – has welcomed remarks by Jacques de Larosière, Lord Turner, Lord Myners and Sir James Sassoon on the European Commission’s draft directive on Alternative Investment Fund Managers.

Speaking at a seminar in London this morning hosted by Business for New Europe entitled “Striking the Right Balance: National, European and Global Regulation”, Jacques de Larosière, whose High Level Group on Financial Supervision in the EU produced an authoritative report on the current crisis, said that he had “personal doubts” about the “wisdom” of “some aspects of the directive”. He said that that his report did not consider hedge funds a systemic issue and that the directive went “much further” than his report recommended.

Lord Turner, Chairman of the UK’s Financial Services Authority, added that he thought there was a danger that hedge funds would become a “target” in Europe - despite the fact, he said, that his report and the de Larosière report concluded that they did not play a major part in the crisis.

Lord Myners, the UK Financial Services Secretary to the Treasury, said the directive was “flawed” and showed “poor understanding” of the industry, and said that the UK government was “working hard to improve the directive” with its European partners and was confident that the final directive would be “much more acceptable”.

Sir James Sassoon, Advisor to the UK’s Conservative Party on Financial Regulation, described the draft directive as “protectionist in effect if not intent”, “poorly drafted”, and said that it was “hugely regrettable” that the Commission had “cut corners” in rushing it out without proper consultation.

Conyers wins Offshore Law Firm of the Year, 2009 at The Lawyer Awards

Multi-jurisdictional law firm Conyers Dill & Pearman was named Offshore Law Firm of the Year at The Lawyer Awards held in London on Tuesday, June 23rd.

According to the Judges criteria, the award is presented to the firm which demonstrates superior strategic clarity, growth of market share, technical legal excellence and quality of service. Conyers fulfilled each of those categories and the Judges commended the firm for an “outstanding year”.

Christopher Johnson-Gilbert, managing partner of Conyers’ London office collected the award at the ceremony which was held at Grosvenor House and attended by over 1000 lawyers. Mr. Johnson-Gilbert commented “We are delighted to receive this award, which reflects the hard work of everyone across the firm over the past year in providing the highest quality legal advice in a responsive and timely manner relating to the leading offshore jurisdictions of the Cayman Islands, British Virgin Islands, Bermuda and Mauritius. Our strategic purpose and our balanced business model have seen continued success even in times of global difficulties.”

The past year has been one of significant expansion for Conyers during which it has advised on a number of high profile deals, consolidated its position in relation to the BRIC markets with new offices in Moscow and São Paulo, and the addition of a Mauritius office and a global Mauritius practice. Conyers has also gained market share in the Cayman Islands and British Virgin Islands, and maintained its dominance in the Bermuda market. Conyers continues to expand with new hires, and now numbers nearly 600 staff with over 150 lawyers located in 11 offices worldwide.

The full results of The Lawyer Awards 2009 can be found here.

Mauritius: The FSC releases its Annual Statistical Bulletin 2009

The FSC’s Seventh Annual Statistical Survey 2008 was carried out by the Financial Services Commission in January 2009 capturing financial data as at 31 December 2008 and 31 December 2007 respectively.

This survey was conducted pursuant to the powers conferred upon the Commission under section 7(2) of the Financial Services Act 2007.

The purpose of the survey was to collect reliable and up-to-date data from licensees for micro and macro economic analysis which enables the Commission to illustrate market trends industrywise and to provide economic inputs for the National Accounts.

Read more

Isle of Man Treasury Minister announces major tax policy move as OECD Forum in Paris

The announcement of a move to automatic exchange of information under the EU Savings Directive keeps the Isle of Man at the forefront of tax co-operation

The Isle of Man Treasury Minister, Allan Bell, MHK, will speak today (24 June 2009) at the prestigious international 10th Organisation for Economic Co-operation and Development (OECD) Forum in Paris, “The Crisis and Beyond”. Mr Bell has also attended a private dinner on the evening of Monday 22 June 2009 hosted by the OECD Secretary-General, Angel Gurría.

Speaking at the same conference session as Minister Bell, which is titled “Promoting Market Integrity” is a group of major global figures:

• Cobus de Swardt, Managing Director, Transparency International;

• Luc Frieden, Minister of Treasury and Budget, Luxembourg;

• Jean-Daniel Gerber, State Secretary for Economic Affairs, Federal Department of Economic Affairs, Switzerland;

• Jeffrey Owens, Director, Centre for Tax Policy and Administration, OECD;

• Guy Ryder, General Secretary, International Trade Union Confederation; and

• Stephen Timms, Financial Secretary, The Treasury, United Kingdom.

Minister Bell will take the opportunity in his comments to thank Secretary-General Gurría for inviting him to speak at the forum, and to signal the importance that the Isle of Man saw in being recognised by the major world economies in this way.

Minister Bell will put forcefully his view that small countries have a lot to gain by engaging with their larger neighbours and with international organisations such as the OECD, but also that they have a lot to contribute to the ongoing development of standards. The Isle of Man, like other small countries, faces many challenges through engaging internationally in this way – not least in terms of resources – but is proud of the enormous strides that it has taken and of its achievements.

In addition to sharing his views on promoting market integrity, Minister Bell will announce a key new tax policy on behalf of the Isle of Man Government. From 1 July 2011, the Isle of Man, in its application of the European Union Savings Directive (EUSD), will move fully to automatic exchange of information. This means that the withholding tax option currently available to customers having accounts with Isle of Man banks by virtue of the transitional arrangements in the EUSD will be withdrawn.

Minister Bell said, “The Isle of Man has led the way for a number of years now in how small countries with financial services centres should operate in the globalised economy. We have consistently shown that we understand at a strategic level what actions we need to take and what changes we need to make in order to maintain our position as a centre of choice for high-quality business and investment.”

“My announcement today is further evidence that the Isle of Man is prepared to align its policies with international benchmark standards, which signals to our trading partners and investors alike that we can be relied upon and that our name is associated with probity and foresight.”

The full text of the news release issued today can be viewed here

AIMA Supports US Regulatory Reform Proposals

The Alternative Investment Management Association (AIMA) – the global hedge fund industry association – has announced its support for the financial regulatory reform proposals put forward by the US Treasury.

The proposals include both the registration of all hedge fund managers whose assets under management exceed a certain threshold and the regular reporting of information relevant to financial stability.

Todd Groome, AIMA Chairman, said, “On February 24th, we announced our policy platform that included our support both for the registration and authorisation of hedge fund managers, and the provision of systemically relevant information by larger hedge fund managers to their supervisors.

We came out in favour of these principles early, since we believed it was important to show our commitment to work with policy makers and supervisors in the broader interest of financial stability. We wanted to continue to demonstrate to the G20 and national authorities that the hedge fund industry was serious about working closely with them to meet the objectives previously outlined by the G20.

We welcome the broad-based principles on regulatory reform produced by the Administration, and we believe that the proposals relating to hedge funds are closely aligned with our own policies announced in February.

We now look forward to working with our members and other industry associations such as the MFA as US lawmakers consider forthcoming legislation, and subsequently working with the supervisory authorities as they look to implement such legislation.”

OECD’s Gurría welcomes recent progress in moves to combat tax evasion

Addressing a conference organised by the French and German governments in Berlin on the fight against tax fraud and evasion, OECD Secretary-General Angel Gurría welcomed progress in implementing international standards of transparency and exchange of information for tax purposes. He announced that the next meeting of the Global Forum on Transparency and Information Exchange, which guides the OECD’s work in this area, will take place in Mexico on 1-2 September.

The OECD’s work to combat tax evasion has received crucial support from the leaders of the G20 and from the G8. Earlier this month, G8 Finance Ministers meeting in Lecce, Italy, asked the OECD to provide “an update on progress on the G20 agreement to tackle tax havens” for the annual meeting of the OECD Council at Ministerial level, which takes place in Paris later this week on 24-25 June. In his statement to the Berlin meeting, Mr. Gurria noted progress made by a number of countries, including Switzerland and, Luxembourg.

Read the full speech

AIMA Welcomes IOSCO Hedge Fund Regulation Principles

The Alternative Investment Management Association (AIMA) – the global hedge fund industry association – has welcomed the principles for hedge fund regulation published by the International Organization of Securities Commissions (IOSCO) today.

Andrew Baker, AIMA CEO, said, “We are very happy to welcome the publication of this report today because AIMA has already announced its support for several of the high level principles mentioned in it.

In our new policy platform of 24th February, we said that we supported global registration for managers and we are glad that IOSCO has also come out in favour of this.

We also expressed our support for the reporting of systemically relevant information by managers of large hedge funds to their national regulators, and this is another one of IOSCO’s key principles.

We are also delighted that IOSCO refers to the ‘development, implementation and convergence of industry good practices’ because AIMA has been extremely active in this area and is continuing a great deal of work on it with the other groups involved. We are following up on a G20 action point in this respect.

Finally, we are pleased that IOSCO have recognised that many of the observations contained in the report may also be applicable to other market participants and that hedge fund managers are already subject to registration/authorisation and on-going supervision/monitoring in most major jurisdictions so it is incorrect to describe the sector as ‘unregulated’.

A few notes of caution, however. We would stress that it is hedge fund managers, rather than the funds themselves, that should registered. It is also mentioned that hedge funds use derivatives for speculative purposes without stating that exchange-traded and over-the-counter derivatives are principally used by the relevant market participants for risk management purposes.

Finally, we are concerned that these recommendations may lead regulators to seek quantity rather than quality of data. It is important that regulators have the expertise and resources to deal with the data they receive.”

IOSCO publishes principles for hedge funds regulation

The International Organization of Securities Commissions’ (IOSCO) Technical Committee has today published Hedge Funds Oversight: Final Report which contains six high level principles that will enable securities regulators to address, in a collective and effective way, the regulatory and systemic risks posed by hedge funds in their own jurisdictions while supporting a globally consistent approach.

The report, which was prepared by the Task Force on Unregulated Entities (Task Force), recommends that all securities regulators apply the principles in their regulatory approaches.

The six high level principles are:

1. Hedge funds and/or hedge fund managers/advisers should be subject to mandatory registration;

2. Hedge fund managers/advisers which are required to register should also be subject to appropriate ongoing regulatory requirements relating to:

a. Organisational and operational standards;
b. Conflicts of interest and other conduct of business rules;
c. Disclosure to investors; and
d. Prudential regulation.

3. Prime brokers and banks which provide funding to hedge funds should be subject to mandatory registration/regulation and supervision. They should have in place appropriate risk management systems and controls to monitor their counterparty credit risk exposures to hedge funds;

4. Hedge fund managers/advisers and prime brokers should provide to the relevant regulator information for systemic risk purposes (including the identification, analysis and mitigation of systemic risks);

5. Regulators should encourage and take account of the development, implementation and convergence of industry good practices, where appropriate;

6. Regulators should have the authority to co-operate and share information, where appropriate, with each other, in order to facilitate efficient and effective oversight of globally active managers/advisers and/or funds and to help identify systemic risks, market integrity and other risks arising from the activities or exposures of hedge funds with a view to mitigating such risks across borders.

Kathleen Casey, Chairman of the Technical Committee, said:

“Securities regulators recognise that the current crisis in financial markets is not a hedge fund driven event. Hedge funds contribute to market liquidity, price efficiency, risk distribution and global market integration. Nevertheless the crisis has given regulators the opportunity to consider the systemic role hedge funds may play and the way in which we deal with the regulatory risks they may pose to the oversight of markets and protection of investors.

The application of these principles, in a collective, cooperative and efficient way, can provide regulators with the tools to obtain sufficient, relevant information in order to address the regulatory and systemic risks posed by hedge funds.”

The Task Force was chaired by the CONSOB of Italy and the Financial Services Authority of the United Kingdom. It was established in November 2008 to support the initiatives undertaken by the G-20 to restore global growth and achieve reforms in the world’s financial systems.

The Task Force will continue to work to support the implementation of these standards by its members and to deal with future regulatory issues that may arise in relation to hedge funds. It will act as the contact point with prudential regulators and banking standards setters, as well as other regulatory bodies such as the Joint Forum and the hedge fund industry in relation to the development and implementation of industry standards of best practice.

IFSL Response to the Turner Review and the FSA Discussion Paper

The response outlines key priorities of UK-based financial services businesses and calls for greater regulatory convergence

International Financial Services London (IFSL), the independent organisation promoting UK financial services worldwide, has submitted its comments to the Turner Review and the Financial Services Authority (FSA) Discussion Paper “A Regulatory Response to the Global Banking Crisis”.

Speaking on behalf of the international interests of its members, IFSL advocates a regulatory regime that is coordinated globally to facilitate convergence and competition in global markets and enable the United Kingdom to remain a leading international financial centre.

In particular, IFSL has outlined the following key priorities for reform of financial regulation at national, EU and global level:

· More convergence of regulatory and supervisory regimes – Greater international regulatory convergence would facilitate growth of business between markets and reduce obstacles to market access for international businesses.

· Market structures that promote competition and openness – Market structures should aim to foster a maximum degree of dialogue with international counterparts. EU regulation should provide a firm base for EU-based businesses to operate in a global market.

· Regulation that blends control with scope for innovation - Regulation should be ‘pro-competitive’ and ‘pro-innovative’, allowing for market governance that facilitates growth and flexibility to create financial instruments needed to respond to future global socio-economic challenges.

· Dialogue and transparency between regulators and practitioners – It is important for international, EU and national regulatory regimes to be institutionally transparent, indicating where regulatory and supervisory responsibilities lie.

· EU developments to contribute to the integrity of the European Single Market – Regulatory change within the EU should work towards sustaining the Single Market and encouraging internationally mobile financial services businesses to stay in the EU rather than migrate to alternative centres. The UK should become actively involved in the new EU organisations such as the European Systemic Risk Board and the new European System of Financial Supervisors, so that their work reflects UK views and priorities.

· European recognition that the UK market is strategic to the EU – It is vital for EU regulation to recognise the important contribution that the UK’s large, successful and highly diversified international financial services sector makes to the EU as a whole.

· Easier market access and growth in international trade – Commitment to a multilateral approach to international market opening for trade in financial services in the WTO framework remains important. The quality of the European Single Market as a bargaining chip in trade negotiations should also be preserved.

Sir Stephen Wright, Chief Executive, International Financial Services London, said: “IFSL is grateful for the opportunity to reflect the standpoint of the UK-based financial services. Our members strongly believe that it is vital that financial regulation and supervision in the UK, the EU and internationally should enable UK-based businesses to continue to compete and succeed as global markets recover in the future.”

IFSL has further answered selected questions in the FSA Discussion Paper that have a particular bearing on IFSL’s member businesses and their international operations. Detailed answers can be accessed in the full response submission, see here

World Bank: Global Economic Turmoil Having Dramatic Effects on Capital Flows to Developing Countries

Amidst global economic recession and financial-market fragility, net private capital inflows to developing countries fell to $707 billion in 2008, a sharp drop from a peak of $1.2 trillion in 2007. International capital flows are projected to fall further in 2009, to $363 billion.

Global Development Finance 2009: Charting a Global Recovery, warns that the world is entering an era of slower growth that will require tighter and more effective oversight of the financial system. Developing countries are expected to grow by only 1.2% this year, after 8.1% growth in 2007 and 5.9% growth in 2008. When China and India are excluded, GDP in the remaining developing countries is projected to fall by 1.6%, causing continued job losses and throwing more people into poverty. Global growth is also expected to be negative, with an expected 2.9% contraction of global GDP in 2009.

Global GDP growth is expected to rebound to 2% in 2010 and 3.2% by 2011. In developing countries growth is expected to be higher, at 4.4 % in 2010 and 5.7 % in 2011, albeit subdued relative to the robust performance prior to the current crisis.

“The need to restructure the banking system, combined with emerging limits to expansionary policies in high-income countries, will prevent a global rebound from gaining traction,” said Justin Lin, World Bank Chief Economist and Senior Vice President, Development Economics, “Developing countries can become a key driving force in the recovery, assuming their domestic investments rebound with international support, including a resumption in the flow of international credit.”

While the authors note that extraordinary policy responses by a number of big economies have prevented systemic collapse, they stress the importance of concerted global action while the crisis is still underway.

“To prevent a second wave of instability, policies have to focus rapidly on financial sector reform and support for the poorest countries,” said Hans Timmer, Director of the Bank’s Prospects Group.

Global integration and the expanding role of private actors in international finance have brought huge benefits, but have also widened the scope for turmoil. Today, developing countries rely heavily on private flows and many countries are being hit by a collapse in corporate finance, with big companies and banks that were powering growth now in distress.

“Many corporations will be hard pressed to service their foreign currency liabilities with revenues earned in depreciating domestic currencies at the same time that export demand has plummeted,” noted Mansoor Dailami, Manager of International Finance in the Prospects Group and lead GDF author.

The risk of balance-of-payments crises and corporate debt restructurings in many countries warrant special attention, the report cautions.

Charting a worldwide recovery will require quick implementation of detailed reforms and an eventual shift away from governments having high stakes in the financial system to a resumption of private sector control of the banking system, the report says. In addition, the big expansion of the money supply in advanced countries will need to be unwound and fiscal deficits will need to be cut in the medium term, to maintain debt sustainability and avoid another debt crisis as seen in the 1970s and 1980s.

Outlook for the Developing Regions

East Asia and Pacific The East Asia and Pacific region has felt the full brunt of the crisis because of its close trade links with high-income countries and because of declining investment as well as a drop in exports and industrial production. Growth for the region is projected to be 5% this year, although several EAP countries are projected to see GDP decline. Recovery across the region is expected to begin in the second half of 2009 and into 2010, reflecting substantial fiscal stimulus in China and a modest recovery of export demand in rich countries. However, the turnaround is expected to be gradual, with regional GDP forecast to increase by 6.6 percent in 2010 and 7.8 percent by 2011.

Europe and Central Asia has been the region most adversely affected by recent developments, in large part because many countries in the region entered the crisis period suffering from substantial imbalances. Large current account deficits and domestic overheating made many countries vulnerable to the abrupt reversal of capital flows and weaker export demand that the crisis generated. GDP is projected to fall by 4.7 percent in 2009, recovering to grow by about 1.6 percent in 2010.

Latin America and the Caribbean entered the crisis supported by stronger fiscal, currency, and financial fundamentals than in the past. However, it too is feeling the crisis in part because of falling commodity prices, but also on the financial side as foreign funds were withdrawn quickly. Flexible exchange rates in many countries in the region were able to absorb much of the initial shock and avoid systemic problems even as equity markets tumbled. Regional GDP is expected to decline by 2.3 percent in 2009, and to reach 2 percent growth in 2010.

The Middle East and North Africa region has been less directly affected by the credit crunch than other regions, but local equity and property markets have come under intense pressure, and developing countries in the region have suffered from much weaker conditions in the high-income countries in the region. Remittances, services exports and FDI flows from these countries and high-income Europe are expected to fall in 2009 – cutting into incomes. Growth is projected to halve to 3.1 percent in 2009, then edge up to 3.8 percent in 2010 and 4.6 percent in 2011, partly because the slowdown has been less pronounced in MENA than in other regions and oil demand and prices are expected to remain low.

South Asia has witnessed considerably diminished capital inflows and a falloff in investment growth. GDP is projected to expand 4.6 percent in 2009, down from 6.1 percent in 2008. Regional output is then expected to increase by 7 percent in 2010 and 7.8 percent in 2011. However, threats to long-term growth include the possibility of heightened fiscal pressures if the global recession is prolonged, and large fiscal deficits.

Sub-Saharan Africa has been hit hard by reduced external demand, plunging export prices, weaker remittances and tourism revenues, and sharply lower capital inflows, notably FDI. Growth is expected to decelerate sharply this year to 1 percent, down from 5.7 percent on average over the past three years. By 2010, growth is forecast to rise by 3.7 percent. Sharp cuts in remittances and official aid flows also represent a risk for the region, because many Sub-Saharan countries rely on aid flows for budget support and because remittances are a vital cushion against poverty.

Complete report as one file (4.5 MB)

OECD Global Forum on Tax Treaties and Transfer Pricing

Transfer Pricing and Treaties in a Changing World

OECD Conference Centre, Paris, 21-22 September 2009

More than 600 participants from all over the globe will gather in Paris for what is expected to be the transfer pricing event of the year.

Some of the world’s leading specialists will share their expertise on cutting-edge transfer pricing and treaty developments that affect governments and multinational enterprises in a changing world.

The conference programme will also offer ample opportunities to exchange views with representatives from more than 100 governments and from the business community, universities and international organisations.

Key topics on the agenda:

● Adjustments and corresponding adjustments:
The role of Articles 7, 9 and 25 of the Model Tax Convention

● Information powers and transfer pricing:
Documentation requirements, exchange of information and burden of proof issues

● Deductibility of interest in related party situations

● Transfer pricing in a downturn economy

● Attribution of profits to Permanent Establishments: designing a modern Article 7

● Transfer pricing and customs

● Treaty and transfer pricing aspects of intangibles characterization

● Recent developments in the areas of transfer pricing and treaties

Tax Co-ordination in Europe: Assessing the First Years of the EU-Savings Taxation Directive

This paper reviews the economic effects of the EU Savings Taxation Directive. The Directive aims at enabling taxation of foreign interest payments received by individuals in accordance with the rules of their State of residence. The data suggest that the Directive, which is based on automatic information exchange, has not led to major shifts in international savings. However, this result has to be interpreted with caution since the available data is scarce and not always conclusive.

Download paper

Hong Kong - Review of the Trustee Ordinance and Related Matters

What are the merits of modernising the Trustee Ordinance (“TO”)?

Reforming Hong Kong’s trust law is a key component in the Government’s strategy to enhance Hong Kong’s position as a major asset management centre in Asia. Our asset management business has huge potential notwithstanding the recent setback under the financial tsunami.

Modernising our trust law will strengthen the competitiveness and attractiveness of our trust services industry. It will encourage more local and overseas settlors to choose Hong Kong law as the governing law of their trusts and to administer their trusts in Hong Kong.

A modern and user-friendly TO will benefit the settlors, trustees and beneficiaries by providing more clarity and certainty in law. It will provide trustees all modern powers necessary for the efficient management of trusts.

Why review is needed?

Some of the provisions in the TO, especially those concerning the powers and duties of trustees, are outdated. They were last enacted in 1934. The rules against perpetuities and excessive accumulations of income in trusts under the Perpetuities and Accumulations Ordinance (“PAO”) are complex and fail to meet market needs.

How is the review conducted?

We have benefited from the inputs of the Hong Kong Trustees’ Association Limited (“HKTA”) and the Society of Trust and Estate Practitioners (Hong Kong Branch) (“STEP”). In addition to working closely with the relevant Government departments and financial regulators, we have also engaged some lawyers, academics and practitioners specialised in the trust field.

Comparable common law jurisdictions like the United Kingdom (“UK”) and Singapore have reformed their trust laws in recent years. We can leverage from their reform experience. We have also critically reviewed some of the reform proposals in the light of the experience learned from the financial crisis. (For example, instead of following the UK and Singapore in giving trustees a general power of investment, we are inclined to retain the range of authorised investments in the Second Schedule (“Schedule 2”) to the TO as “safe harbour” limits that can be overridden by trust instruments or orders of the court.)

We will also invite public views on several proposals put forward by the trust services industry to promote the use of Hong Kong trust law. These proposals are mainly based on the experiences of off-shore jurisdictions such as the British Virgin Islands, Cayman Islands and Jersey. We will form a view on these proposals after hearing the views of all stakeholders.

Charitable trusts may need to be treated differently in several areas, such as trustees’ power to employ agents and professional trustees’ entitlement to receive remuneration. We will engage them in the consultation process.

What is the consultation and review timeframe?

The consultation will last 3 months (from 22 June to 21 September). We aim to draw consultation conclusions by the end of 2009, with a view to introducing legislative amendments into the Legislative Council in 2010-11.

Consultation Paper (PDF format)

Reply Form ( PDF or DOC format )

FAQ (PDF format)

Growth in Global Derivatives Business Stalls in 2008 - Value of Exchange Turnover to Drop 25% in 2009

• 13 per cent fall in OTC derivatives in second half 2008: first ever decline recorded by BIS
• Exchange-traded derivatives turnover value drops 47 per cent in year to Q1 2009 and could fall by up to 25 per cent in 2009
• Call for reforms to derivatives business to preserve availability of products and not disadvantage London
• Future growth of OTC derivatives dependent on opening up of new global markets

The long period of rapid growth in the global derivatives industry was checked in 2008, with both over- the- counter (OTC) and exchange-traded business slowing in the final months of the year. The findings are revealed in the new edition of Derivatives, a research report from International Financial Services London (IFSL), the independent organisation promoting UK financial services worldwide.

Moves to centralise the clearing of some OTC derivatives contributed to a 13 per cent decline in notional outstanding value of contracts in the second half of 2008, from $684 trillion in June to $592 trillion at the year end. This marked the first such fall since the Bank for International Settlements (BIS) started collecting statistics in 1998.

Centralised clearing has now become more common for some classes of OTC derivatives contracts. This includes interest rate swaps, commodities and credit default swaps (CDS). Moves to centralised clearing have been prompted by concerns about systemic risk particularly related to damage caused by collateralised debt obligations.

CDS saw an even larger drop of 28 per cent in the second half of 2008, with voluntary termination of contracts also playing a role. London is the leading global centre for OTC derivatives, with 43 per cent global market share, compared with 24 per cent in the US. London is also central to the development of niche OTC markets in energy, freight and carbon trading.

The global decline in OTC trading volumes comes as regulators consider greater future regulation of OTC derivatives. While there are differing views on the role of OTC derivatives as a contributory cause to the crisis, the drive for regulatory repair in both the United States and Europe will include much closer oversight of these markets, the imposition of comprehensive trade reporting to the regulatory authorities and widespread use of central clearing.

Sir Stephen Wright, Chief Executive, International Financial Services London, said: “It’s vital that London’s leading position is not undermined by any future reform to the conduct of derivatives business in the United States or the European Union. IFSL urges that any changes to the regulatory framework surrounding derivatives ensure that these products remain widely available as a risk management tool.”

All four London-based exchanges – NYSE Liffe, LME, ICE Futures Europe and EDX London - had a record year in number of contracts traded in 2008, with NYSE Liffe passing 1 billion contracts for the first time. This reflects London’s continuance as a major location for global exchange-traded derivatives trading. 98 per cent of NYSE Liffe turnover by value, for example, takes place on the London exchange, while more than 45 per cent of Eurex trades have originated in the UK since 2003.

However, while some exchanges had a record year, this was based primarily on high turnover in the early months of 2008. The overall aggregate value of global exchange traded turnover slumped by 47 per cent in the year to the first quarter of 2009, although most of this decline was during 2008: the fall had slowed to 3 per cent between the fourth quarter of 2008 and first quarter of 2009.

Duncan McKenzie, Director of Economics at IFSL, said. “Year on year the value of exchange turnover could drop by 25 per cent in 2009. While exchange trading could eventually be lifted by proposed reforms, future growth of OTC derivatives will be more dependent on opening up of new markets including those in emerging economies.”

Click here to view PDF of Derivatives 2009 report

Indicators on the importance of the financial sector in selected jurisdictions 2004-2006

Indicators on the importance of the financial sector in selected jurisdictions.  Latest available data in the 2004-2006 period
	The financial sector's share in GDP	The financial sector's share in employment	“Value creation” per employee in the financial sector. USD thousands
Jersey	50,0	22,0	303
Bermuda	32,5	17,9	209
Isle of Man	28,6	20,9	109
Guernsey	25,5	22,6	118
Bahrain	18,4	2,4	308
British Virgin Islands	18,1	6,3	176
Dominica	12,9	2,0	44
Cayman Islands	11,9	17,1	46
Seychelles	10,2	2,9	79
Singapore	9,5	5,0	108
Mauritius	8,0	2,7	69
Panama	7,8	1,2	88
USA	7,8	5,9	139
Bahamas	6,4	2,2	105
Source: IMF (2008), Ecowin (for USA)