Jersey and IoM ministers express satisfaction with latest OECD report

Government ministers in the Isle of Man and Jersey said they were pleased with relevant findings contained in the latest report by the OECD’s Global Forum on Transparency and Exchange of Information on Tax Matters, which evaluates the information exchange practices of various countries.

The report assessed the exchange of information standards and other key tax- and information-reporting measures of six jurisdictions, and was issued last week following a meeting of the Global Forum in Yaoundé, Cameroon.

The report, like the meeting itself, was among the latest manifestations of the Paris-based Organisation for Economic Co-operation and Development’s continuing work aimed at boosting and harmonising global standards of tax information exchange policies and transparency.

As the OECD noted, the meeting took place in the immediate aftermath of the release earlier this month of the so-called “Paradise Papers” trove of documents by a US-based investigative journalism organisation, which in turn had obtained them last year from the Bermuda offices of the Appleby law firm.

Some 200 delegates from more than 90 delegations attended the OECD’s meeting in Yaoundé, for what the OECD said was  the tenth meeting of the Global Forum on Transparency and Exchange of Information for Tax Purposes.

In addition to the Isle of Man and Jersey, the other jurisdictions that were covered in the latest Global Forum peer review process were  Curaçao, Denmark, India and Italy. The reports of these six jurisdictions brought to 16 the total number of  second round reviews of the Forum’s 147 member countries and jurisdictions, based on its international standard of transparency and exchange of financial account information on request.

An earlier report, covering 10 other jurisdictions, was published in August, and considered the standards of compliance on offer in Australia, Bermuda, Canada, Cayman Islands, Germany, Ireland, Jamaica, Mauritius, Norway and Qatar.

The transparency standard was reinforced last year to tackle tax evasion more effectively, particularly in areas covering the concept of beneficial ownership.

‘Important progress’

In their report, Jersey’s Global Forum peers found the Channel Islands’ jurisdiction to have made “important progress…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”, the report, which may be viewed and downloaded here, notes.

“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 EOI [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.”

Jersey chief minister Ian Gorst said he welcomed the OECD’s Global Forum’s “recognition that Jersey is fully committed to the highest standards of tax transparency and cooperation with international standards”, and added: “at a time when transparency is more important than ever, Jersey continues to demonstrate its steadfast commitment to international cooperation.”

Jersey Finance chief executive Geoff Cook, pictured left, described the rating as “an unequivocal endorsement” both of Jersey’s world-class tax transparency framework and its ability to make sure that this framework is working well in practice.

Cook added that, because The Global Forum’s second round of reviews was a “rigorous assessment”, for Jersey to have been found to be “entirely compliant” in each area is a “fantastic achievement, underlining our commitment to combatting financial crime and tax abuse.

Cook obliquely referred to the negative publicity that Jersey was subject to in the recent so-called Paradise Papers revelations, saying that it sent out a “strong message” that Jersey was serious about tax transparency, “while also serving to reinforce just how unjustifiable the claims sometimes made against Jersey’s position on tax transparency really are.”

IoM: ‘continues to be compliant’

As for the Isle of Man, the Global Forum researchers concluded that it “continues to be ‘compliant’ with the international standard on transparency and exchange of information upon request”, observing as well that its legal framework for the availability of ownership, accounting, and banking information “is in place, and legal obligations are subject to proper oversight”.

To address a gap relating to entities that are not required to engage an anti-money laundering obliged service provider, they note, the island’s government passed new beneficial ownership legislation in 2012, which it has extended the obligation to identify the beneficial owner or owners of legal entities on the island “to all relevant entities except for general partnerships”.

“The Isle of Man also addressed a weakness identified in its practice during the last round of reviews, namely the sharing information received under an EOI request with the financial intelligence authority,” a summary of the Global Forum researchers’ findings continues.

“In terms of exchange of information, the Isle of Man has been commended by peers for its highly efficient and cooperative EOIR [exchange of information on request] practice.”

 Isle of Man treasury minister Alfred Cannan MHK, pictured left, said that the Isle of Man’s “high levels of international cooperation” deserved to have been recognised by the OECD.

“It has become much harder to reach the standard required to achieve a top rating as the bar has been raised for this second round of reviews,: he added.

To read and download the Global Forum’s report on the Isle of Man,  click here.

To read and download the reports on Curaçao, Denmark, India and Italy, click here.

In a separate matter, also at the Yaoundé meeting, the Global Forum on Tax Transparency delegates also agreed that the countries and jurisdictions working within the Global Forum as well as within the inclusive framework on Base Erosion and Profit Shifting (BEPS) could provide support to the European Union on its current listing exercise to identify third country jurisdictions that fail to comply with tax governance standards

A decision to continue the Global Forum’s Africa Initiative, in order to ensure that benefits “from advances in tax transparency” may be achieved, also was made. 

ABOUT THE AUTHOR
Eugene Costello
Eugene Costello has been a journalist for some 20 years, and has written for a wide variety of UK and international newspapers and magazines.

Read more from Eugene Costello

preloader
Close Window
View the Magazine





You need to fill all required fields!