Countries who sell their passports are often frowned upon but the reality is that all countries try to encourage immigration by the wealthy by granting residency which leads to nationality, or nationality itself, in return for investment – it is just the price and timescale that differs. Many of you will recall the rush by Hong Kong persons to obtain the insurance of a right to abode elsewhere in the lead up to 1997. Canada and Australia were the favoured jurisdictions as they had relatively clear rules and a relatively modest level of investment required in order to grant foreign nationals a residency. And those new residents had to wait only a relatively short time before becoming eligible for, and normally being granted, citizenship. Many of those taking out these residencies did not necessarily want to emigrate but did want to know that they could do so if things didn’t work out for them in Hong Kong after 1997. In the end things turned out swimmingly and lovely and many of those who moved abroad came back or shelved any plans they might have had to move away. There are still many countries where the future is uncertain either politically or economically and this encourages their citizens to either emigrate or take out an alternative residency or citizenship as an insurance policy in case things get worse. There are many from the more troubled areas of the world who fear for the future and may more who have money to invest and choose to do so in countries which will give them some kind of formal status in return.
If you are considering a second residency or passport then there are factors worthy of consideration:1. How much do you need to invest to get residency (if anything) 2. How long does it take before you are eligible for citizenship? 3. Do you have to remain in the new country for a certain minimum number of days in order to be eligible for citizenship?4. Does your new country allow you to maintain your old citizenship or prohibit dual citizenship?5. Does your old country allow you to keep your existing passport or does it prohibit dual citizenship?6. Does the passport issued by your new country give you easy travel i.e. does it have arrangements with lots of other countries for visa free entry?7. Are there any requirements for national service (joining the army)?8. What are the costs of living including the tax rates and tax incidence?
Imagine being offered immediate citizenship by Rumbabwe only to find that they do not allow you to keep your old passport, their citizens are unwelcome everywhere else in the world so you need a visa to go anywhere and visas are not necessarily readily available because Rumbabwe freely offer citizenship to other nationalities, that you immediately have to sign up for the army and they are currently engaging war with Freestate and their taxes are 95% on worldwide income and capital gains with no planning opportunities to avoid those taxes.
One of the more interesting possibilities for immediate, well the process takes about 3 months, citizenship is currently available from St. Kitts and Nevis. They have run a successful “nationality by investment” programme since 1984 which allows citizens of other countries to become passport holders in St. Kitts and Nevis in return for a one off investment of US$350,000 in a qualifying property. Applicants must continue to own the property for 5 years or risk losing citizenship. After that they are free to sell the property if they wish. And there is no difficulty in financing the purchase so applicants need only put up about US$200,000 in cash with the rest of the purchase price being borrowed from a bank. There are conditions attached but they are not unattractive. One property developer even offers a scheme whereby applicants can buy a share in a company which owns property for US$400,000 and the developer will buy back those shares for the same US$400,000 after 5 years. This scheme qualifies the purchaser for citizenship. In all cases expect government and other fees of about US$100,000.
St. Kitts and Nevis allows dual nationality and is an UK commonwealth country which many think makes the place rather credible. Their passport gives visa free access to around 190 countries and allows visa free travel within Europe as it has signed agreements with the Schengen countries which is all of Europe apart from the UK. The UK allows visa free access for all Commonwealth citizens. This seems pretty attractive.
The only equivalent programme that we can find is the Economic Citizenship programme run by the Commonwealth of Dominica (do not confuse this with the neighboring Republic of Dominica) where they will offer immediate citizenship in return for an investment in government bonds of US$75,000. Unfortunately the visa free access is much more limited. This programme that has been running quite successfully for quite some time but has recently fallen out of favour as St. Kitts has gained favour.
No other countries seem to legitimately offer the same immediate citizenship program. From time to time I have been approached by others purporting to represent countries which are now offering economic citizenships but the first question to them is to show us the clause in the nationality law which allows citizenship by registration in return for investment. Frequently the laws do not allow it so the scheme seems to rely upon something rather more sinister and should be avoided at all costs.
Other countries offer a swift route to residency in return for a relatively modest investment which in time will lead to citizenship. Canada continues to attract new immigrants under its investment program which requires US$800,000 in investment. This can be financed so the cash contribution is only US$200,000. Citizenship should follow within five years.
Bulgaria has recently announced an interesting program. Bulgaria is full member of the European Union and will grant residency in return for an investment on BGN 1,000,000 which is about US$500,000. Once residency has been granted it is relatively easy to travel freely within Europe. Citizenship should follow 2 years after residency and once granted the EU principle of free movement of labour and right of establishment should allow the new immigrant to live and work anywhere within the European Union without further authorization. This could be very attractive and has attracted many non-EU immigrants. The US, of course, still has many different ways to enter. Each year, 50,000 immigrant visas are made available through a lottery to people who come from countries with low rates of immigration to the United States. None of these visas are available for people who come from countries that have sent more than 50,000 immigrants to the United States in the past five years. Anyone who is selected under this lottery will be given the opportunity to apply for permanent residence (a Green Card). If permanent residence is granted, then the individual will be authorized to live and work permanently in the United States. Successful applicants are allowed to bring their spouse and any unmarried children under the age of 21 with them. The number of places are awarded according to quotas for each country but they treat it as a form of foreign aid so award different countries different quotas depending on their close connection with the US and then the perceived need to help their citizens. One of the biggest recipients is the Philippines so if you are a Philippine citizen you have the biggest chance of winning a green card if you enter the lottery. It is free to enter although many offer to assist with the entry process for substantial fees.
Monday, March 12, 2012
Nationality by Investment
Thursday, December 15, 2011
До свидания, оффшор! До свидания?
Приведенные далее ответы на часто задаваемые вопро-сы помогут разобраться иностранным покупателям и инвесторам в недвижи-мость в ближневосточном регионе в послед-ствиях внедрения Земельным департа-ментом этих новых правил, а также в том, как данные изменения влияют на последую-щую процедуру регистрации собственности на имя оффшорных компаний.
Для чего человеку использовать оффшорную компанию при покупке недвижимости в Дубае?
Существует ряд причин, объясняющих растущую популярность использования оффшорных компаний при регистрации недвижимости. Наиболее очевидная –желание избежать непривычного местного законодательства при наступлении ситу-ации наследования. Компания никогда не умирает. Если ваша собственность заре-гистрирована на бюджетную оффшорную компанию, вы (а также члены вашей семьи или партнеры) могут владеть акциями ком-пании в соответствии с долевым участием или исходя из предпочтений. Таким образом, вместо вашего имени (физического лица) на официальном документе о владении собственностью (Title Deed), будет указано название компании (юридическое лицо). Это самый простой способ для совместных инвестиций, который в то же время добав-ляет дополнительной конфиденциальности при владении недвижимостью.
Получается, на сегодняшний день, единственной оффшорной компанией, на которую я имею возможность заре-гистрировать недвижимость, является оффшорная компания «Джебель Али»?
Совершенно верно. Однако это касается только Дубая. Например, вы можете приоб-рести недвижимость в Абу-Даби, зарегистри-ровав её на имя компании в оффшорной зоне БВО (Британские Виргинские острова). Согласно решению Земельного департамента Дубая от 1 января 2011 года, недвижимость, приобретенная на территории Дубая, может быть зарегистрирована на имя оффшорной компании в «Джебель Али».
Может ли иностранная компания владеть оффшорной компанией «Джебель Али»?
Да. Вы можете, например, использо-вать компанию на БВО, или траст для вла- дения акциями вашей компании в СЭЗ «Джебель Али». Однако вам необходимо будет предоставить требуемый минимум информации на владельца компании и недвижимости, включая сертификаты акций и копий паспортов.
Как проходит процедура регистрации, если недвижимость еще не сдана в эксплу-атацию? Если договор купли-продажи был подписан до января 2011 года от моего лица, могу ли я перерегистрировать право собственности на имя компании?
Земельный департамент Дубая имеет два реестра: первый – временной реги-страции собственности, и главный –реестр учета недвижимости, уже сданной в эксплуатацию. В момент регистрации в главном реестре (что происходит после сдачи недвижимости в эксплуатацию), можно будет изменить имя собственника с физического лица на оффшорную компа-нию в «Джебель Али», предоставив соот-ветствующее подтверждение о не смене владельца, т. е. свидетельство, подтвержда-ющее факт, что бенефициаром компании выступает владелец недвижимости.
Должен ли я буду оплачивать допол-нительный взнос за перерегистрацию собственности, если в настоящее время договор купли-продажи оформлен не на имя оффшорной компании в «Джебель Али»?
Для совершения процедуры пере-регистрации прав собственности на имя компании, застройщик должен выдать «Сертификат об отсутствии возражений» (NOC) на перевод недвижимости на имя оффшорной компании в «Джебель Али». Как отмечалось ранее, застройщику необходимо предоставить доказатель-ство того, что лицо, указанное в дого-воре купли-продажи, является факти-ческим владельцем новой компании.Стоимость сертификата обычно не пре-вышает 3500 дирхамов ОАЭ.
Если сертификаты об отсутствии воз-ражений предоставлены застройщиком и СЭЗ «Джебель Али», процедура пере-регистрации проводится без взимания дополнительной оплаты, опять же по предоставлению доказательства того, что лицо, указанное в договоре купли-продажи, является фактическим владель-цем новой компании.
Что делать, если моя недвижимость уже зарегистрирована на имя оффшорной компании на БВО?
Изменения в регистрации недвижимо-сти относятся только к случаям, имевшим место до 1 января 2011 года, и не затраги-вает существующие структуры владения собственностью.
Позволяют ли оффшорные компании в «Джебель Али» владеть недвижимостью по всей территории Дубая?
В соответствии с циркуляром СЭЗ «Джебель Али» от 2006 года, оффшорные компании в «Джебель Али» могут владеть недвижимостью в любом проекте Дубая, при-надлежащем таким застройщикам, как Dubai World, Dubai Holdings и Emaar Properties.
В принципе, хотя и не существует никаких ограничений на регистрацию недвижимости на имя оффшорной ком-пании в «Джебель Али», владельцу ком-пании необходимо получить «Сертификат об отсутствии возражений» от СЭЗ «Джебель Али», для того, чтобы зарегистри-ровать собственность в Земельном депар-таменте Дубая. По состоянию на сегодняш-ний день мы не сталкивались с отказом в выдаче «Сертификата об отсутствии возражений» на недвижимость вне пере-численных выше проектов.
Как проходит регистрация офф-шорных компаний в СЭЗ «Джебель Али»? Сколько это будет стоить инвестору?
Процедура регистрации довольно про-ста, требования по предоставлению доку-ментации на владельца компании стандар-тна. Когда сооветствующие документы пре-доставлены, регистрация занимает около 4-5 рабочих дней. От акционеров компании требуется единовременное посещение СЭЗ «Джебель Али» для подписания учреди-тельных документов (или предоставление доверенности на третье лицо). Стоимость регистрации компании составляет US$ 4500, ежегодное продление лицензии – US$ 2050.
Компания Sovereign Corporate Services является одним из первых агентов, зареги-стрированных в СЭЗ «Джебель Али». Услуги по регистрации и сопровождению компаний осуществляется квалифицированным персо-налом в составе 25 человек.
Расскажите, как проходит процудура продажи недвижимости, которая зарегистрирована на имя компании (юридическое лицо)?
У вас есть два варианта: вы можете либо продать имущество компании, просто под-писав соответствующие документы от имени её директора, или продать акции компании (предполагается, что компания владеет только одним активом – недвижимостью).
Земельный департамент Дубая должен быть уведомлен о внесении изменений в структуру компании, для этого в него необходимо предоставить копии соответствующих заверенных доку-ментов. Мы будем рады помочь со сбором и предоставлением документов.
На все последующие вопросы специалисты компании Sovereign Corporate Services с удовольствием вам ответят. Пожалуйста, обращайтесь:
Анастасия Белова, менеджер по развитию бизнеса
abialova@sovereigngroup.com
+971 4 448 6010
+971 50 785 9180
Wednesday, December 7, 2011
Sovereign supports rising team
Sovereign supports rising team
IT’S all change for basketball team Manzur this season with a new sponsor, a new name and a combined force of players going into division two of the Yorkshire Guernsey league.
Last year the side had an A team and a B team playing for divisions two and three but a strategic decision to combine top players meant the side sits neatly in division two.
Changes to league means the side will also have the opportunity to play against division one teams in a combined division knockout tournament so the team will be exposed to a highly competitive level of basketball.
This coincides with a new sponsorship deal with Sovereign Trust, which has agreed to support the side.
Now named Sovereign Trust, the basketball team includes two Most Valuable Players (MVPs) from last season. Coach Matthew Sarl was voted as the best player in division two and in division three it was Liam Doherty, who also finished highest on the scoreboard.
Mr Doherty, trainee compliance officer at Sovereign Trust, said it was a huge opportunity to pit themselves against more experienced players.
‘A lot of the players in division one frequently travel off island to play national games so the standard is just much higher. Getting to compete at that level is really exciting for us and will no doubt improve our basketball. I have high hopes. I’m obviously biased but by pooling our talent I think we could do really well this season,’ he added.
Managing director of Sovereign Trust, Rob Shipman, said: ‘Liam approached me earlier this year about getting involved with the team. We’re always keen to support staff and the community in general so were happy to assist. I look forward to seeing how they progress in this division and wish them good luck,’ he added.
Exclusive IFAS Programme introduced by Sovereign Trust
For the exclusive use of IFAs Sovereign Trust (Channel Islands) Limited “Sovereign Trust” has introduced the International Financial Adviser Support or ‘IFAS’ Programme, a unique technical support programme to provide a one-stop shop for information on international pensions.
The technical expertise is provided by Isle of Man based PenTech Limited, specialist Pension Technicians, which has signed an exclusive deal with Sovereign Trust. Sovereign Trust, which already enjoys a sizeable share of the international pensions market, both QROPS and QNUPS, is part of an international group that provides financial services but is independent of any bank, law firm or IFA group.
The PenTech designed IFAS Programme is a unique web-based service that provides IFAs with access to live data and fast responses to queries about existing UK or international pensions schemes for the benefit of their clients. To access the service IFAs simply need to register and create their own profile.
Once approved, IFAs are able to log on to a secure, confidential service portal through which they can ask questions and track and review all of their cases. Each request is handled by experienced and qualified Technicians and all correspondence is recorded and can be revisited at any time. The comprehensive and unique service also includes provision of basic critical yield reports and, if required, the production of an all-important independent Pension Transfer Report (‘TVAS’).
Sovereign Trust’s managing director Rob Shipman said: ‘UK and international pensions are increasingly complex due to ever changing legislation. The Sovereign sponsored ‘IFAS Programme’ is a fantastic resource for IFAs wanting to give the best advice to their clients.’
Director of PenTech Peter Davis added: ‘The service has been far more successful than we could have ever anticipated. We are continually updating it as our clients’ needs evolve. It is completely live and offers total technical support for IFAs.’
Contact Sovereign Trust for more details of how to access this unique facility.
ENDS
Enquiries to: Rob Shipman
ci@SovereignGroup.com
Sovereign Trust (Channel Islands) Limited
Tel: +44 (0)1481 729965
www.SovereignGroup.com
Thursday, October 6, 2011
Family Affairs
Nobody likes to think about their own mortality. It is a surprising statistic that in the UK two thirds of the population die without leaving a will. I would presume that the figure in similar in other countries. In the majority of cases this is not the biggest problem in the world because there is not much of an estate to bequeath and what there is automatically goes to the next of kin- which, if they should care, is probably exactly in line with their wishes. For wealthier people, as typified by those who play golf or read golfing magazines, this is likely to be a major problem but such persons normally take a little more care over their wealth and how it is passed on.
The alternative to a will is a trust. Trusts can have huge advantages. They allow the distribution of the wealth to be controlled so that children get looked after but do not necessarily get a huge lump sum of cash which might cause them to go party mad and disincentivise them from having a career or job. Frequently wealthy bread winners want their spouse to be well looked after but they do not want to risk the spouse re-marrying and the new partner running off with all the money. They want the bulk of their capital to be preserved for the children or even grandchildren. All this can be achieved through trusts. Setting up a trust also forces the settlor to put his affairs in order early by transferring the assets to the trustees so that on death there is little or nothing to be done thereby saving those left behind the heartache, worry, expense and delays which are necessarily involved in administering an estate. Even a simple estate can cost up to 6% of its value in fees to administer and take a minimum of two years to get sorted. This is not attractive for anybody-apart from the lawyers. Trusts provide a means of avoiding all that.
The disadvantage of a trust is that it involves… well… a level of trust. Assets have to be passed over to trustees and the settlor loses control. In a previous article I wrote about the joys of private trust companies. These provide a method of setting up a trust and retaining a good degree of control. They remain attractive and are being used increasingly by the sophisticated client.
There is another option. This is being increasingly used by UK domiciled persons who are restricted in their ability to transfer assets into trust by the 20% lifetime inheritance tax charge which applies to substantial transfers. These entities will be attractive to a whole range of persons because they are simple and easy to understand and relatively simple to set up and administer. They are known as Family Investment Companies (FICs) in the UK. We also refer to them as common law foundations as they are similar to the civil law foundation found in Lichtenstein and elsewhere but are much easier to understand by those brought up by in a common law system.
FICs are a company. The usual form of a company is limited by shares. A share has three important characteristics being: a)The right to vote and therefore control the company; b)The right to receive income in the form of dividends; c) The right to the capital and the underlying assets owned by the company. Usually a share will carry all three rights but it is quite possible for it to carry only one or two of these three. By splitting the rights and obligations we can create interesting results.
For example, let us assume that Mr. A is an UK national living in Hong Kong. He does not intend to spend the rest of this life in Hong Kong so is almost certainly UK domiciled and subject to UK IHT on his worldwide estate. His first preference would be to pass the assets into trust to avoid UK IHT but he cannot do so as the transfer to the trust would attract the 20% charge. If he gives assets away to another individual seven years before his death then he avoids UK IHT and the 20% charge entirely but that would leave him without assets to look after himself and therefore reliant on his beneficiaries. He would also lose control of those assets. Neither is attractive. Instead we set up an FIC. Mr. A is issued with all the voting shares and therefore keeps total control. He also jointly retains, along with his wife, the income producing shares because although he does not envisage spending the capital he does want to ensure his lifestyle and spend the income. The capital shares can be given away to his wife and children whilst he is in good health. This structure means that all his assets are conveniently bundled together in one package so his executors do not have to try and find them, take control and administer them according to the will. UK IHT is massively reduced as he has given away the capital seven years before death. Clearly the income producing shares do have some value but it is minor compared to the capital shares. Sweet and simple.
This type of structure would be effective for most persons who are in danger of being subject to inheritance tax or estate duty in their home country or anywhere else in the world. There is no estate duty in Hong Kong but just because you are resident in Hong Kong does not mean you are exempt from estate duty everywhere else in the world. Assets are frequently charged to estate duty in their country of location irrespective of who owns them. If they are owned by a company then, because a company never dies, local estate duty is eradicated. Hong Kong residents will often have estate duty considerations in their own county of birth and anywhere they have invested but this type of structure can remove those liabilities.
The structure above will also be of relevance to those who have parents back in their home county with wealth to pass on. We frequently get asked about whether we can help reduce estate duties on their estate. Funnily enough the beneficiaries are often more concerned about this! For those living in the UK a trust is going to be unattractive because of the 20% charge. Giving away assets seven years before death is going to be unattractive because of the reasons I gave above i.e. loss of control and having to rely on relatives for future upkeep. There is nothing to stop a UK resident from setting up one of these structures. For most it will not give income or capital gain tax advantage without further planning but that is not the aim. It is a way of eradicating or considerably reducing estate duties.
The plan can further be refined by using a company limited by guarantee or a company limited by both guarantee and shares. Most people will be familiar with companies limited by guarantee even if they do not know it as this is the basis of most clubs and societies. When you join a club you become a member, rather than a shareholder , of a company limited by guarantee. That membership is retained only for as long as you are alive or for as long as the club (company) committee decides you are worthy and suitable and abide by the club rules. This type of company can be sued as an FIC. Using an FIC avoids the need for a will and probate on the underlying assets as they are all owned by the company. A probate is still required to pass on the voting and income producing shares. So if the votes and income rights are held by members rather than shareholders those rights would expire on the death of the owner and then new members could be elected with those rights thereby transferring them without the need for further procedure and the avoidance of probate entirely. Hybrid companies are able to issue both shares and memberships so the various rights and obligations can be mixed and matched between the two to create whatever result is required and suits the circumstances of the family.
This type of structure is the latest big news in UK estate planning but can be used by anyone anywhere else in the world to good effect. It doesn’t remove the need for a will as there will always be personal assets outside the structure but it does provide a convenient and relatively cheap and simple method of dealing with the majority a person’s estate.
Wednesday, April 6, 2011
Executive aircraft – toy or tool?
Since the implementation of the Córdoba Agreement in 2006 – when restrictions were removed to permit direct flights from Spain – Gibraltar residents may have noticed an increasing number of small, private aircraft using the airport. We have certainly seen an increase in corporate jet activity and I expect to see this increase when the new terminal opens. I understand there will be services dedicated to the business aviation industry based from the terminal, so that is another reason to look forward to its completion.
But how, in these economically strained times, can such “toys” be justified? Surely this is yet another example of the type of corporate excess that should have been consigned to history. A number of large companies certainly seem to think so – they have either sold or downsized their aircraft fleets in recent years. But is there any place for expensive business aircraft in the post-crisis economic world in which we now find ourselves?
In my opinion, there is. Executive aircraft come in all sorts of shapes and sizes and there are many ways to own or operate them from full to fractional ownership, or simply chartering on an ad hoc basis. Under the right circumstances, the sensible use of a private jet – however this is done – can not only be economically justified, it can be a very attractive option both to business people and the companies they represent. Read on.
Consider this example. Imagine you are in Gibraltar with five colleagues and you need to get to Nice for a meeting. There are no direct flights from here and although Málaga is only a hundred miles up the coast, surprisingly there are no direct flights to Nice from there either. Our party of six business executives is now faced with a dilemma and at least two flights – first to London or Paris, then an onward connection. How much more simple it would be to charter a business jet for a direct flight from Gib to Nice – and presumably back again, although of course that may not be necessary.
The advantages speak for themselves. The party simply turns up at the airport very close to departure time and, in this example, the round trip could easily be achieved in just one day. Naturally the formalities remain but they are generally easier to complete and there’s no need to arrive up to two hours before departure as with commercial trips. A direct flight straight to the airport closest to where you want to go could be just what your company needs. There will be a considerable saving of down time and any of the usual difficulties one can encounter when using scheduled airline services – cancellations, overbooking, delays – will be avoided. In addition, confidentiality is assured and, because the fellow passengers are likely to be colleagues or associates, the flight time can be spent more profitably.
What is the likely price for such convenience? As always this can vary widely but, as an example, local private charter firm GibJets (www.gibjets.com) charges around £2,500 per flying hour. Divide that between the six passengers that its aircraft might typically carry, and one can start to appreciate the commercial sense of using this option. Add to that the fact that executive jets can use a much greater range of airfields than those available to commercial airliners, then the expense becomes even easier to rationalise. Business jets can land at airports with limited facilities and very often – depending on the type of aircraft – they can be operated by just a single pilot.
So much for the theory. In these days of economic austerity what is the state of the market for business jets? They range in price from the so called “Very light Jet” or VLJ (sometimes referred to as “Entry Level Jets”) to airliners such as the four engine Airbus A340 used by a very select band of billionaires and royalty for their private, or executive, use. The price tags match this wide range, starting at a couple of million dollars but easily rising to US$100m or more for the airliner-size versions.
My colleagues at Register An Aircraft.com, Sovereign’s aviation division, report that the sector has certainly seen a noticeable downturn since the onset of the global economic crisis. The use of business jets as a corporate tool was much criticised at the height of the crisis; who can forget the outcry over bankers and automakers flying to Washington in their private jets to testify at congressional hearings into the massive government bailouts they were receiving?
As the economic situation stabilises, at least in certain countries, the use of corporate jets is once again becoming more acceptable for many international businesses (and more importantly their shareholders). The business case for such use has not changed – the time and money saved, together with more confidentiality and better use of time spent flying. What has changed is the perception of the press and the public in relation to the “Jet Set”.
The business jet charter market is certainly recovering; we are seeing a number of these aircraft landing at Gibraltar on a more regular basis. And it is interesting to note that, while new aircraft sales in Europe are still slow, business has been increasing in other parts of the world. In particular, dealers are reporting higher levels of interest in the Middle East, India, China and South America – especially Brazil where a local manufacturer, Embraer, has developed into a world leader.
So as we all look forward to using our own brand new airport terminal later in the year, I hope to see even more of these remarkable aircraft flying into and out of the Rock. Next time you see one, rather than seeing it simply as a toy for spoiled executives, consider instead that it might just be a serious business asset that is adding to the bottom line in clear and demonstrable ways.
Aircraft landing and taking off at Gibraltar will of course fly over the marinas where super yachts seem to be perpetually moored. Pleasurable these vessels undoubtedly are; practical, sometimes, maybe. But one cannot drift on an executive jet. They are designed to get one from A to B far more efficiently than commercial flights. That is the difference and the reason why I, for one, believe that given the right circumstances they can be ideal business tools. This is also why I am looking forward to welcoming them to Gibraltar in ever greater numbers. And the wealthy people they carry, of course!
Monday, March 14, 2011
India to get bank details from Switzerland starting April: Government of India
NEW DELHI: India will be able to access banking information from Switzerland in specific cases beginning April 1, 2011, Parliament was told today. India and Switzerland had signed an agreement on August 30, 2010 to amend the Double Taxation Avoidance Agreement (DTAA) to facilitate exchange of information between the two countries.
"The amended DTAA (with Switzerland) will enable India to get banking information in specific cases for a period beginning April 1, 2011 and thereafter", Minister of State for Finance S S Palanimanickam told the Rajya Sabha in a written reply.
The revised DTAA with Switzerland was signed by Finance Minister Pranab Mukherjee and Micheline Calmy-Rey, head of Swiss Federal Department of Foreign Affairs. While the India has completed the formalities for implementation of the revised DTAA, Switzerland has yet to ratify the agreement, Mukherjee said in reply to another query.
"The amending Protocol will enter into force on completion of the internal process by Switzerland. Switzerland has informed that they have still not completed their internal process as the Amending Protocol has yet not been ratified by their Parliament", Mukherjee said.
The revised DTAA, according to Palanimanickam, will, "specifically provide for exchange of banking information as well as information without domestic interest". The Amending Protocol, he added, "contains a provision wherein the requesting state has to provide the name of the person under examination or investigation and, if available, other particulars facilitating that person's identification such as address, date of birth, marital status and tax identification number."
The revised agreement with Switzerland, however, will not allow "fishing expeditions", a term used for seeking general information. "The Amending Protocol also provides that these clauses contain important procedural requirements that are intended to ensure that fishing expeditions do not occur. Nevertheless they need to be interpreted in order not to frustrate effective exchange of information", the Minister added.
Pointing out the government does not have any verifiable information on the total amount of money deposited in Swiss banks by Indian nationals, Palanimanickam said the Finance Ministry was getting a fresh study done on unaccounted income and wealth within and outside the country.
"The proposal (of study) was approved by the government in January 2011. The study is likely to be completed within a timeframe of 18 months", he added.
The government is committed to tax undisclosed income of Indian residents within and outside the country, the Minister said, adding "this also include undisclosed deposits in other countries including Switzerland. Since this in an on-going process, no time frame can be fixed for the same".
Monday, March 7, 2011
Confusion over UAE Inheritance Law for Expats
Sovereign Group, Abu Dhabi Office
There have been many conflicting views on inheritance laws in the UAE. "If I were to pass away in the UAE and my bank accounts are frozen, how is my wife to access my funds? What about my will written in the UK?" As these questions among others - were directed to a panel of legal experts at a symposium held at Abu Dhabi Chamber of Commerce and Industry (ADCCI) on 28th February 2011, not all elicited easy answers.
The panellists, who admitted to a gaping conflict of views on inheritance laws in the UAE, said they would persuade the government to bring about greater clarity on such matters.
"A lawyer can say to you we cannot guarantee you anything because in a civil code country, judges are not bound by judgments of previous cases," said Cynthia Trench, Principal of legal firm Trench & Associates, which organised the symposium at the ADCCI.
"We have a lot of conflicts here because of which courts are giving conflicting judgments, lawyers are giving conflicting advice and the press is giving conflicting articles," she said.
To illustrate her point, Trench referred to different sections of the law and said on the one hand, we can look to the law of domicile of expatriates, Article 17 (1), to determine the distribution of properties or assets. On the other, Article 17 (5) says the laws of the UAE shall apply to wills made by expatriates disposing of their property in the state. And there's Article 2 (Civil Transactions Code), which says the principles of Islamic jurisprudence shall be relied upon in interpreting these provisions. "What law should we apply?" she wanted to know.
Cynthia further cited recent Dubai Court Cases and explored that
1. Presently the majority of the judges apply Sharia Law and ignore any Foreign Wills;
2. Even if you manage to obtain the ears of a sympathetic judge, it would take over 12 months and could cost more than Dhs 50,000 (Advocate fees, notarisation and legalisation of the Foreign documents, translation costs and foreign lawyers’ fees).
Dwelling on a document issued by the Notary Public on wills for non-Muslims which says, "Write it, Attest it, Keep it", Trench referred to Para 12 which in effect notes that the decision would not be upheld by the competent court.
To avoid such unfavourable implications, the most certain way moving forward is to take the ownership of your assets, bank accounts and properties offshore. The UAE laws at the moment allow Expatriates to own any assets under an offshore company, which in effect takes the assets outside UAE jurisdiction for inheritance purposes.
Tuesday, March 1, 2011
UK sees “non-dom” departures as £30,000 charge kicks in
HM Revenue & Customs reported, on 13 January 2011, that the number of UK "non-domiciled" residents had declined from 139,000 to 123,000 in the year prior after the launch of the £30,000 remittance basis charge in April 2008.
McGrigors, the law firm that secured the figures under a Freedom of Information request, said the 11.5% decline was the first for five years and was likely to have been repeated in 2010 as more long-term non-doms became liable to the change.
The UK coalition government has pledged a review to assess whether non-doms were making “a fair contribution to reducing the deficit” and a Treasury spokesman said last night that the review was “ongoing” and a further announcement would be made at the appropriate time.
About 5,400 people paid the £30,000 non-dom levy for the 2008/09 tax year, more than the 4,000 predicted by the Treasury prior to the tax’s introduction. This collected around £162 million, with £350 million forecast for 2009/10. The Treasury has estimated that non-doms pay around £4 billion in income tax each year, on top of the tax they pay on capital gains on UK assets, stamp duty and value added tax on spending, which brings the estimated total to £7 billion.
Monday, February 28, 2011
Channel islands appoint head of new Brussels office
Guernsey and Jersey announced, on 25 January 2011, that Steve Williams, currently British Ambassador to Bulgaria, had been appointed to head up the new Channel Islands’ office in Brussels. Williams, whose title will be director of European affairs, will assume the post on 4 April.
The new Channel Islands Brussels office will represent the political and economic interests of Guernsey and Jersey, which previously were handled by the Brunswick public relations and lobbying firm. The Isle of Man has also announced plans to open a representative office in Brussels.
Williams has worked for the UK Foreign & Commonwealth Office for almost 30 years, with postings including Oslo, Buenos Aires, Sofia and the UK Permanent Representation to the EU in Brussels. Jersey Chief Minister, Senator Terry Le Sueur, said: “We are pleased to have someone of Williams’ calibre and experience representing us in Brussels.