IMF - Banking in a Steady State of Low Growth and Interest Rates

A prolonged low-interest-rate environment presents a significant challenge to banks and is likely to entail major changes to their business models over the long-run. Lower returns to maturity transformation in the face of flatter yield curves and an inability to offer deposit rates significantly below zero combine to compress bank earnings in this environment. Smaller, deposit-funded, less diversified banks are hurt most, increasing consolidation pressures and reach-for-yield incentives, presenting new financial stability challenges.To the extent that such an economic environment reflects a new, steady-state with lower equilibrium growth driven by population aging and slower productivity growth, lower credit demand is likely to drive banking toward provision of fee-based, utility services.

Working Paper No. 18/192

IMF - Monetary Policy with Negative Interest Rates: Decoupling Cash from Electronic Money

Monetary policy space remains constrained by the lower bound in many countries, limiting the policy options available to address future deflationary shocks. The existence of cash prevents central banks from cutting interest rates much below zero. In this paper, we consider the practical feasibility of recent proposals for decoupling cash from electronic money to achieve a negative yield on cash which would remove the lower bound constraint on monetary policy. We discuss how central banks could design and operate such a system, and raise some unanswered questions.

Working Paper No. 18/191

L'île Maurice, le paradis de la «criminalité en col blanc»

Samedi 25 août sur une radio privée, Basant Roi, Gouverneur de la Banque de Maurice a affirmé qu’il se peut que le montant d’argent sale dépasse les estimations de la MRA qui est de 35 milliards. Alors qu’on se focalise uniquement sur les provenances liées au trafic de drogue illicites, il se pourrait que la criminalité en col blanc soit beaucoup plus profitable. Tout comme nos hommes politiques parlent beaucoup de l'évasion fiscale des particuliers, mais peu de celle des entreprises.

www.zinfos-moris.com

Mauritius: FSC issues Practice Notes regarding Corporate Trusteeship Services

The objective of these Practice Notes (the “Notes”) is to provide for the implementation of a common set of standards for Qualified Trustees and Management Companies (“Trust Services Providers - TSPs”) when they provide corporate trusteeship services.

Practice Notes for Qualified Trustees and Management Companies when providing Corporate Trusteeship Services

Royal Reserve Collection: King In The North

Brewery Ommegang and HBO Licensing & Retail have announced the newest beer in their collaborative series inspired by the award-winning drama Game of Thrones. King in the North, a beer brewed for Jon Snow, is the fourth and final beer in this year’s Royal Reserve Collection, a series of four limited release beers, each designed and brewed as an homage to one of four epic figures engaged in the battle for the Seven Kingdoms.

Brewed to sustain a leader through a long, dark night, King in the North is a barrel-aged imperial stout. The beer will be available at the brewery and at retail as of Black Friday, November 23, on draft and in 750ml bottles. The suggested retail price per bottle is $12.99.

King in the North will be released alongside a one-of-a-kind gift pack, just in time for the holidays. The gift pack features one 12-ounce bottle of each of the four Royal Reserve Collection beers and a collectible Game of Thrones glass. The suggested retail price for a gift pack is $24.99.

“There was only one character with whom we could end the Royal Reserve Collection,” said Doug Campbell, Brewery Ommegang president. “I don’t think we’re alone in our hopes for Jon Snow. And for those who missed one of the Collection during the year, we’re pleased to offer the opportunity to get all four at once, along with a glass in which to serve them.”

“We’ve now arrived at our fourth and final Royal Reserve beer which celebrates Jon Snow with a big, bold, barrel-aged stout for the long cold nights to come,” said Jeff Peters, vice president of licensing & retail at HBO. “We expect this one to bring our fans to their feet to toast the King in the North!”

King in the North pours jet black with a thick tan head. Aromas of roasted malt, coffee, and chocolate blend with those of oak, bourbon, and vanilla. The flavour is rich and full with notes of chocolate, vanilla, coffee, and roasted malt up front followed by smooth bourbon and a hint of oak. The finish is thick and chewy with oatmeal creaminess, and pleasant lingering roast. King in the North pairs well with funky aged cheeses, rich dark meats and decadent desserts. It also makes a great dessert on its own.

The Royal Reserve Collection features four new beers in the brewery’s Game of Thrones-inspired series with HBO. All of the beers will be available on draft and in 750ml bottles. The series began in April with Hand of the Queen, a barleywine, and was followed in June by Queen of the Seven Kingdoms, a sour blonde blend. Mother of Dragons, a smoked porter and kriek blend, will arrive in September before King in the North and the gift pack.

English Court of Appeal Denies Angolan Sovereign Wealth Fund Bid to Reinstate Worldwide Freezing Order Against Quantum Global

The English Court of Appeal denied a request for permission to appeal by the Angolan sovereign wealth fund to reinstate a $560 million worldwide freezing order against Quantum Global, the fund manager, and its chairman Jean-Claude Bastos de Morais.

The Court of Appeal further ordered costs against the Fundo Soberano de Angola (FSDEA) in relation to its request.

The Court of Appeal’s decision essentially means that most of the FSDEA’s underlying claim has failed in the UK.

During the original hearing last month, Quantum Global presented evidence in court showing that it had managed the FSDEA funds under valid contracts with rigorous and transparent reporting, that its fees were in line with industry standards, that the mandate was won after a proper selection process and that any conflicts of interest were properly declared.

Quantum Global is still challenging similar court injunctions in Mauritius, which have prevented the company from managing its investments in Africa and paying its staff for five months. Unlike the UK case where Quantum Global successfully challenged the misleading claims made against it, the Mauritius authorities have refused officially to disclose the reason for the injunctions despite repeated calls for a fair hearing according to due process of law.

African Blockchain Report 2018

The African Blockchain Report 2018 takes a look at the early pioneers of the technology across Africa, highlighting some of its potential use cases and applications, as well as exposing some of the challenges that lie ahead.

Find out why blockchain is being postioned alongside the cloud, Internet of things (IoT) and Artificial Intelligence (AI) as the emerging technologies that will help build a bright digital future for Africa.

Jersey Finance Encourages Industry Engagement in Vital Consultations

Jersey Finance is encouraging firms to engage with two key consultations currently under way in Jersey, which provide evidence of the jurisdiction’s willingness to combat financial crime and meet global standards of financial regulation.

A consultation launched last month by the Jersey Financial Crime Strategy Group makes a number of proposals aimed at implementing recommendations made by the Financial Action Task Force (FATF) to strengthen Jersey’s credentials in fighting financial crime. In particular, the consultation puts forward measures to tackle the financing of weapons of mass destruction, provide further clarity around transparency, and be tougher on corruption. The closing date for submissions is 30 September. 

A further consultation launched by Jersey’s government earlier this month aims to get feedback on proposals to satisfy concerns previously raised by the EU’s Code of Conduct Group around the concept of ‘economic substance’. The proposals draw on thinking from both the OECD and EU relating to economic substance, as well as the legal and regulatory requirements that already exist in Jersey. The deadline for submissions is 31 August.

Both consultations follow the recent introduction of new legislation designed to strengthen Jersey’s capabilities to fight financial crime. Amendments to the Proceeds of Crime (Jersey) Law were approved by Jersey’s government in June to ensure Jersey complies with recommendations highlighted in the 2016 MONEYVAL report. 

Geoff Cook, CEO, Jersey Finance, said: “Taken together, these two vital consultations are evidence of the positive steps Jersey is taking to work with the international community to support global moves to clamp down on financial crime and promote sound financial regulation. As a jurisdiction we stand united with the global community on this front, and we’d strongly encourage industry to engage with both of these consultations as we continue to demonstrate Jersey’s leading position on these issues.”

English High Court Issues Milestone Judgment in Favour of Quantum Global

The English High Court today issued a milestone judgment in favour of Quantum Global Group and its founder Jean-Claude Bastos de Morais in their dispute with the Angolan sovereign wealth fund.

The Court confirmed its earlier decision to discharge in full a $3 billion worldwide freezing order (WFO) imposed on Quantum Global and Mr Bastos in April. It strongly criticised the eight areas of unfair and misleading presentation to the court by Norton Rose Fulbright, the legal advisors to the Fundo Soberano de Angola (FSDEA).

“There was a high degree of culpability in the failures,” Mr Justice Popplewell said of the misleading presentation.

“The breaches of duty are sufficiently serious and culpable to warrant discharging the WFO and not granting fresh relief, irrespective of the other grounds of challenge,” the judgment reads.

Furthermore, in respect of one major category of claim, “lawful means conspiracy”, the Judge expressly agreed with the defendants and held that the merits of the claim were so weak they did not pass the threshold of raising a serious issue to be tried on the facts alleged by the FSDEA.

Mr Justice Popplewell also decided against the FSDEA on most matters of jurisdiction: “My conclusion is that there is only a small rump of causes of action in respect of which jurisdiction is established,” he said. This judgment essentially means that most of the FSDEA’s underlying claim has failed in the UK, pending an application to the Court of Appeal against the discharge order, which is expected to be decided this week.

Addressing unsubstantiated allegations originating in the “so-called Paradise Papers” cited by Norton Rose, the judgment states: “There is no evidence to suggest that the use of offshore structures by the group was anything other than the normal and legitimate way the group structured itself for tax, regulatory and other proper business purposes; or that Mr Bastos’ personal use of such structures was not his normal modus operandi for legitimate personal reasons.”

Quantum Global will now focus on resolving issues in Mauritius and Switzerland, where the authorities’ freezing of Quantum Global’s bank accounts and suspension of its business license have severely damaged the company’s business, in a case mirroring that in the UK.

The English High Court judgment also addresses facts that are central to the case in Mauritius. The ruling states that limited partnerships in offshore jurisdictions “are not unusual for private equity investments; that they were known about and not disapproved by Deloitte at the time; that the structure was not a matter of criticism by E&Y in their investigations; and that the drawing down of the full committed amounts into the accounts in the names of the Limited Partnerships so as to put them beyond the control of FSDEA was for a legitimate political objective.”

The actions by the Mauritius authorities have prevented Quantum Global from managing its investments in Africa and paying its staff for five months. To date, the Mauritius authorities have refused officially to disclose the reason for their actions against Quantum Global and Mr Bastos despite repeated calls for a fair hearing according to due process of law.

IFC Economic Report Summer/Autumn 2018 - Blockchain: IFCs

Ongoing advances in blockchain and fintech have the potential to radically alter the global financial industry, and IFCs are well positioned to take full advantage. The 10th issue of the IFC Economic Report explores how IFCs are future-proofing their services in a bid to maintain a strong competitive edge. The IFC Economic Report brings together a full spectrum of industry participants, practitioners, academics, regulators and government bodies to ensure that all angles and developments are covered – giving you a comprehensive view of the latest developments impacting the movement of global wealth.

Introduction of substance requirements for companies tax resident in Jersey

The purpose of this consultation is to get feedback from key stakeholders (including companies, industry associations, practitioners and any other interested parties) on the actions required for the Government of Jersey to address concerns raised by the EU’s Code of Conduct Group (Business Taxation) regarding economic substance.

The Government of Jersey is seeking views on the outline proposal contained within this consultation and how the actions within the outline proposal can be implemented. The proposal draws on thinking within the Organisation for Economic Co-operation and Development (OECD) and EU relating to economic substance, as well as looking at legal and regulatory requirements that already exist in Jersey.

Feedback provided will inform the drafting of the relevant legislation and allow government to ensure a smooth transition for companies carrying out relevant activities.

The Finance (Miscellaneous Provisions) Act 2018: Changes to the global business sector

AXIS in association with BLC Robert is pleased to share with you the salient features of legislative amendments touching the global business sector which have been introduced by the Finance (Miscellaneous Provisions) Act (the “Finance Act”) passed by the  National Assembly on 31 July 2018.

The Finance Act gives effect to the measures announced in Budget Speech 2018-2019 to revamp and further modernise the global business sector. In this document, in Part I, we address 5 main aspects of the legislative developments: (A) Changes to the existing regulatory regimes, (B) New obligations for structuring vehicles (C) Changes to the existing tax regime, (D) Changes to the banking and finance legal regime, and (E) AML/CFT compliance. In Part II, we address other legislative amendments which are relevant to the activities within the global business sector.

Please click here to access the document and to have more details.

Jersey: JFSC launches ground-breaking online application tool for Jersey Private Funds

The Jersey Financial Services Commission (JFSC) has today launched its online application tool for Jersey Private Funds (JPF).

The online application is ground-breaking for both the JFSC and Industry, and will transform the way in which applications are processed for new licences.

This development forms a key part of the JFSC’s Change Programme and is core to its e-enablement strategy, by speeding up application turnaround times and improving efficiencies, resulting in the regulator being an easier organisation with which to do business.

Jill Britton, Director of Supervision, commented:

“The JPF online application is really exciting and hugely important for the Island, as it lays the foundation blocks for enabling our future online capabilities, as a regulator, and is the first step in providing end-to-end authorisations for new licenses across all sectors that we supervise.”

In order to develop the application and test the portal prior to launch, the JFSC worked with an external user group of financial services firms.

Paul Monahan, Director from Langham Hall Fund Management (who was part of the user group), added:

“The JFSC’s new online portal looks set to change how Industry interacts with our regulator and all applications and notifications will be paper-free by early 2019. The system is autonomous and provides the potential for instant approvals for suitable applicants, which could be a real gamechanger when it comes to application timescales.”

Nespresso single origin coffees

Our Coffee Experts have been working hard to ensure Nespresso continues to provide you with the best coffee experience. That's why we're launching a new range of single origin coffees, mastered by craftsmen, inspired by the land.

This new range will be revealed in a few weeks. As part of this launch, Nespresso will gradually discontinue its existing Pure Origin range of coffees.

Pure Origin (Dulsão do Brasil, Indriya from India, Rosabaya de Colombia, Bukeela ka Ethiopia)

Master Origin (India, Indonesia, Colombia, Nicaragua, Ethiopia)