Jersey confirms its status as a leading jurisdiction in global standards of international tax transparency.
By Mirek Gruna, Managing Director.
What is the Global Forum?
The Global Forum on Transparency and Exchange of Information for Tax Purposes is a multilateral framework of tax transparency and information sharing with over 140 jurisdictions participating on this initiative.
The Global Forum monitors and reviews the implementation of international standard of exchange of information on request and automatic exchange of information. The legal and regulatory framework of each jurisdiction is assessed as is the implementation of the exchange of information framework in practice. The final result is a rating for each of the essential elements and an overall rating.
First round peer review
During the first round assessment in 2014 two reports were evaluated against Terms of Reference for both the legal implementation of the exchange of information standard as well as its operation in practice and concluded that Jersey was rated “Largely Compliant”. The particular elements of the evaluation that were assessed as largely compliant as opposed to compliant were (i) access to information (ii) rights and safeguards (iii) exchange of information mechanism and (iv) confidentiality.
Second round peer review
The second round peer review reveals the important progress made by Jersey in the implementation of the international standard, leading to the upgrade of its overall rating from Largely Compliant to Compliant with all elements determined to be in place and rated Compliant. Notably, Jersey took the necessary actions to fix deficiencies identified in its 2014 peer review report regarding effective use of information gathering powers, protection of confidentiality and ensuring that requests for clarification do not create unduly delays to the exchange process.
Jersey processed 262 requests over its new review period (1 July 2013 – 30 June 2016), which represented almost the double of the requests received during its previous review period (2010-2012), and has been able to respond to almost all of these requests in a timely manner. The multilateral Convention was extended to Jersey by the United Kingdom in 2014, allowing a large number of jurisdictions requesting information to Jersey. It is believed that exchange of information activity will continue to increase. Jersey has dedicated appropriated resources to its exchange of information program and is viewed as a cooperative and efficient partner by its peers.
What does this mean for Jersey?
This positive evaluation reinforces Jersey’s key position as one of the best- regulated international financial centres in the world. It also shows how serious Jersey is about the importance of global tax transparency and sets aside any unjustifiable claims made against the island in relation to the fairness of its tax system. The result also shows Jersey’s absolute commitment to tackling financial crime and tax evasion.
How can we help?
Our client administration teams and our directors have unparalleled technical expertise in tax-related matters, and in particular with regards to UK taxation. In addition, our ability to efficiently and timely implement tax structuring advice in close cooperation with our clients and their tax advisors as well as our understanding of underlying tax concepts and tax-related risk management processes set us apart from our competition.
If you would like to discuss this article, please contact Mirek Gruna.