Jersey and Isle of Man get early Christmas present from the EU

The European Union’s Council of Ministers has finally given its formal approval to the zero-ten business tax regimes in Jersey and the Isle of Man.
The approval was given by Ministers in Brussels on 19th December, a month earlier than expected, after the EU Code of Conduct Group had accepted that the Islands' moves to remove certain deemed distribution and attribution elements to their ‘zero-ten’ tax regimes in September, meant that the Code’s criteria would be satisfied.
Whilst approval was something of a formality for EU Ministers, because the Code Group had already confirmed in the Autumn that it viewed the Islands' amended regimes as compliant, the formal confirmation was nonetheless very welcome for the finance industries in Jersey and the Isle of Man, as it provides clarity and certainty for the Islands' long-term future.

The changes that Jersey has effectively been required to make in order to obtain the approval of the EU are expected to cost the Island in the region of £10 million in lost taxation.  Nevertheless, given the enormous importance to the Island's economy of a stable and attractive finance industry, the developments have largely welcomed in the Island. 

Guernsey, meanwhile, will have to wait a little longer to clarify its position, although it is to be expected that it too will eventually come to an arrangement with the EU that allows the preservation of its own zero-tax product.  Ecofin chose to deal with Jersey and the Isle of Man first, and suspended its investigation of Guernsey's arrangements 18 months ago, to give Guernsey time to conduct its own independent review.  However, in the absence of a resolution to Guernsey's internal review, in the late Autumn Ecofin determined that it would resume its own process. Guernsey will therefore be hoping that it will not take too long to catch up with its larger neighbour and the Isle of Man.

OV Group continues its Asian expansion apace

OV Group (the merged business of Offshore Incorporations Group and Vistra) is becoming a force to be reckoned with in the world of trust, fiduciary, corporate and fund services. Despite the global economic gloom, OV has continued with an aggressive expansion plan through a combination of organic growth into new territories and a series of acquisitions designed to add scale and geographical reach to the business.

Although they could have been forgiven for taking some time out from the acquisition trail to focus on post-merger integration, in fact the OV Group appears not to have slowed down its ambitious growth plans as 2011 draws to an end.  Vistra has recently announced the launch of Vistra Fund Services Asia Limited, a new Hong Kong based operation which will complement its fund administration operations in Jersey and Luxembourg, and the acquisition of Cynosure, a 20-man specialist corporate services provider focused on the establishment of Wholly Foreign Owned Enterprises (WFOEs) in China.  This latest acquisition means Vistra now has a considerable presence in mainland China, with offices in Shanghai, Beijing and Guangzhou.

In focusing on Asia as an area for expansion, Vistra is not alone, as many other companies in the sector are also trying to establish a foothold there.  However, Vistra will benefit from the relatively high profile in Asia of the OIL business, and has gained scale from the merger of Acceptor & Credence Trust, and now the acquisition of Cynosure, and as such should be well placed to make an impact in the region.

OV Group has clearly set out to become one of the small number of "super-consolidators" emerging in the sector, such as TMF.  And so far it seems to be making big strides to achieving that.