The Jersey Court of Appeal recently handed down a long-awaited judgment in the Z Trusts case. The decision considers important questions regarding the equitable rights of former trustees and whether those rights have priority over the rights of other claimants to the assets of a trust (including successor trustees) whose liabilities exceed its assets. As such, trustees must consider the practical implications of this judgment and whether and how they should be mitigated.
The Jersey Royal Court recently ruled on the extent of its powers to restrict a party that withdraws proceedings to start afresh in a judgment that considered, for the first time, the implications of a 2014 English Court of Appeal decision on the public interest in there being finality in litigation. This is an important decision for maintaining the public interest in the finality of litigation and the efficient administration of justice.
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It is well known that new investment company listings have been relatively sporadic of late – this is not entirely due to Brexit, but it is clear that Brexit has stalled a number of fundraisings which have gone out to market. Fortunately, once there is some clarity on the way forward, there may be a race to market. Data from the London Stock Exchange (LSE) to the end of January 2019 shows that Guernsey is home to more non-UK incorporated companies listed on the LSE than any other jurisdiction globally.
The first-ever challenge to a decision of Channel Islands Financial Ombudsman Douglas Melville has been heard by the Jersey Royal Court. The court upheld the ombudsman's decision that local mortgage broker and lender Future Finance pay two individuals more than £63,000 in compensation.
Two recent cases in the Guernsey Royal Court – one relating to the variation of a settlement and one relating to the winding up of a trust – demonstrate the complex trusts cases that regularly come before the court. The first case involved an application from two mothers on behalf of their children, whose father is a famous professional footballer. In the second, an investment firm, as the sole member of a discretionary class of beneficiaries, applied for a trust to be terminated and the trust fund to be distributed to it.
The Income Tax (Substance Requirements) (Implementation) Regulations 2018, as amended, came into effect on 1 January 2019 and apply to accounting periods commencing on or after that date. The new economic substance requirements apply to certain Guernsey tax-resident companies and have been passed in order to comply with the EU Code of Conduct Group on Business Taxation. This article summarises the current position relating to the substance requirements for fund management companies.
Anyone that has been refused planning or building permission or disagrees with a condition that has been attached to a planning or building permission or anyone that owns or occupies a building or land where a building, place or tree has been listed can appeal against a planning decision. However, Jersey planning appeals raise numerous questions regarding costs and the appeal process.
The Taxation Law 2019 has introduced new economic substance requirements which apply to certain Jersey tax-resident companies. The requirements were passed to comply with the EU Code of Conduct Group on Business Taxation for the purpose of demonstrating that the profits generated by Jersey companies which carry on certain specified geographically mobile activities are commensurate with their economic activities and substantial economic presence in Jersey.
Increasingly stark and startling messages relating to the environment and climate change are now commonplace in the media. That is why it is so refreshing to know that Guernsey is taking a leading role on the world stage and using its strengths to produce a significant positive impact, including through the implementation of the Guernsey Green Fund.
The government and the Cayman Islands Monetary Authority are well aware that it is imperative that the Cayman Islands is not only perceived to, but does in fact, play a central role in the global fight against money laundering and terrorist financing. At the same time, there is a deep understanding of the need to remain competitive and commercial. This article addresses a number of key questions concerning the 2018 amendments to Cayman's anti-money laundering regime.
Employers want maximum restriction on employees who leave but must be careful not to overstep the mark as covenants which are unduly restrictive risk being struck out by the courts. As such, employers should be aware that disgruntled employees can file complaints with the Guernsey Competition and Regulatory Authority and might also bring civil actions for damages pursuant to Section 42 of the Competition Ordinance.
Jersey's environmental legislation covers areas including water pollution, nuisance, planning, wildlife and waste disposal. Further, the minister for planning and the environment has the power to exercise enforcement in a number of ways. This system ensures that all development within Jersey is carried out in accordance with the local legislation and any specific conditions imposed by the minister. However, even with active and engaged enforcement, legislation can only go so far.
This article addresses how the landscape for the structuring of offshore investment funds established in the Cayman Islands is changing and how this change is being driven by the evolving relationship between investors and investment fund managers – in particular, how the balance of power has in many cases shifted from the manager to the investor.
A recent Royal Court judgment has indicated that delays in bringing an application to set aside a transfer of property to a Jersey trust due to mistake will be considered by the court when exercising its discretion as to whether to grant relief. In particular, this decision clarifies that delay is a factor that the court will consider when determining whether the mistake is of so serious a character as to render it just to make a declaration setting aside a disposition into trust.
The Association of Investment Companies Code of Corporate Governance (AIC code) is a framework of best practice for the governance of investment companies. The new AIC code applies to accounting periods which began on or after 1 January 2019. As such, Guernsey boards are urged to (among other things) review their existing corporate governance arrangements and determine which code is applicable to their companies.
The government has approved new regulations which impose an economic substance test on Guernsey tax-resident companies in order to meet the requirements of the EU Code of Conduct Group. The regulations, which came into force on 1 January 2019, establish tests for tax-resident companies carrying on 'relevant activities', including fund management.
Personal assets that most commonly need to be accessed in Jersey following the death of a non-domiciled person are shares in Jersey companies and Jersey bank accounts and investments. If individuals are domiciled outside Jersey, they need not prepare a separate will to cover their Jersey personal estate if they already have a valid one which covers their worldwide personal estate; however, doing so can offer significant benefits.
New legislation recently came into force in the Cayman Islands requiring in-scope entities that carry on particular activities to have demonstrable economic substance in Cayman. Relevant entities must make an annual report as to whether they are carrying on one or more of a defined list of activities (relevant activities). If they are, they must satisfy an economic substance test in Cayman in respect of such relevant activities.
A recent Royal Court decision arose out of an attempt by the settlors of trusts to exercise their power to revoke the trusts. The trustee in this case was concerned and so petitioned the Royal Court for directions. Among other things, the court's decision highlights that trustees should be aware of how a trust fund might be distributed on revocation of a trust. Trustees should also review their terms and conditions of business to ensure that they are protected against any potential adverse consequences.