Offshore News: October 2008

30.10.2008 A Tax Information Exchange Agreement (TIEA) has been signed by the British Virgin Islands and Australia. This was announced on October 27 by the Australian Assistant Treasurer Chris Bowen and the Premier of the BVI Ralph O'Neal. The agreement provides for full exchange of information on request in criminal and civil tax matters. Also, it indicates legislation in the BVI and Australia that provides for mutual legal assistance in criminal matters. Under the terms of the agreement, both countries will not apply prejudicial or restrictive measures based on harmful tax practices to nationals or residents while the Tax Information Exchange Agreement is effective. Australia will remove the governmental references to the British Virgin Islands as a "tax haven", and now it will list the offshore jurisdiction as an "information exchange country" in the Taxation Administration Regulations 1976.

23.10.2008 On October 21, leaders of the Organisation of Economic Cooperation and Development (OECD) member countries met in Paris to discuss a new crackdown on offshore centres aimed to establish tighter regulation of the global financial system. This initiative was led by the governments of Germany and France. It could lead to compiling a new "blacklist" of offshore jurisdictions that are non-uncooperative. This meeting was boycotted by such jurisdictions with a measure of banking secrecy as Switzerland, Austria and Luxembourg.
It should be noted that from an offshore viewpoint, the recent rhetoric from the French government about the current banking crisis is worrying. Also, last week, President of France Nicolas Sarkozy asked why banks that have received backing from the government continue operating in tax havens.

11.10.2008 Deutsche Bank has been granted full Custody Licence in Guernsey to offer an enhanced, full range of custody services in this jurisdiction. The licence was granted by the Guernsey Financial Services Commission in September. A custody service was offered by Deutsche Bank for more than 25 years through its office in Jersey, and it acts as custodian for assets valued at more than EUR 12 billion there. The bank's new custody business is expected to attract those who may be time-zone sensitive but interested in tapping into other global financial centres through Deutsche Bank's global network.