Why Offshore Trusts in Jersey Are More Competitive

Jersey is currently revising and bringing up to date its offshore trust laws and becoming an even more competitive jurisdiction

There is great competition between the leading offshore financial centres such as Jersey, Guernsey and the Isle of Man and new competitors such as Dubai for example – each jurisdiction needs to be seen as the most competitive, best legislated and so on and so forth if they are to win and retain business.  Therefore and to that end, the financial services authorities in Jersey are currently reworking a great many of their laws and regulations pertaining to all things offshore to ensure they remain one of the most successful offshore tax havens in the world.

One of the most closely worked upon pieces of legislation at the moment relates to the establishment, protection and management of trusts in Jersey.  In this article we look at why offshore trusts in Jersey are more competitive now as a result of the ongoing action to revise and hone trust law in the Channel Islands.

Old tax haven favourites such as the Channel Islands, Isle of Man, Luxembourg and Switzerland have taken something of a significant hammering in recent years because of EU legislation to erode taxation competition between member states and third countries, and because the likes of Dubai, Bahrain, Hong Kong and Singapore have come up hot on their European tax haven counterparts’ heels in terms of the sophistication and competitive nature of their own offshore legislation.

It’s a well known fact that the likes of Jersey and Switzerland have lost out on savings related offshore business because of the EU Savings Tax Directive to Hong Kong and Singapore – so now that Dubai has entered the world of offshore trusts, Jersey is absolutely committed to remaining at least as competitive as the new contender.

For those considering the establishment of an offshore trust, more competition is currently boding well for you because until last year Jersey’s trust laws had not been revised since the early 1990s and to this day there are still certain definitions within the law that date back to the 17th century! 

Fortunately Jersey now has a working party revising all trust laws specifically those relating to the guidance given to Jersey’s court for foreign challenges to trusts.  Additionally outmoded legislation will be brought up to date and greater clarification will be given relating to disclosure to beneficiaries.

The current working party is looking at bringing in the fifth batch of amendments to trust law in Jersey that the jurisdiction has seen in just over a year…so as you can see, Jersey is absolutely committed to remaining competitive and totally determined to retain and win offshore trust related business even in the face of stiff and sustained competition from both old and new tax havens.