Ogier

St Helier

Jersey, the largest of the Channel Islands, is one of the world's major international finance centres. The successful combination of stability and reliability has kept Jersey at the forefront of global finance for almost half a century. Government determination to encourage high quality business to the Island, and the support offered by the sophisticated and comprehensive infrastructure of laws and regulations, combine to promote investor confidence.

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Updates

Banking

Virtual currency regulation takes effect
Jersey | October 28 2016

The value and volume of virtual currency trading is skyrocketing globally, but regulating virtual currencies and virtual currency exchangers is challenging. Under the new Proceeds of Crime (Miscellaneous Amendments) (Jersey) Regulations 2016, exchangers must comply with the island's anti-money laundering and terrorist financing laws, regulations, policies and procedures.

Welcome to the virtual currency sandbox: let's play
Jersey | October 21 2016

While virtual currencies may divide opinion, it is undeniable that they are booming and becoming part of the mainstream. Jersey has answered the question of how to seize this opportunity by introducing a 'regulatory sandbox' for developers and innovators to build, test and experiment with products, services, business models and delivery mechanisms in a live environment without immediately incurring all of the normal regulatory consequences and costs.

Company & Commercial

Court rules on limitation period for breach of directors' duties
Jersey | August 13 2018

The Jersey limitation period for claims against directors for breach of duty under Article 74 of the Companies (Jersey) Law 1991 has not been definitively decided by the Jersey Royal Court. However, the UK High Court recently found that the prescription period for claims against directors of Jersey companies for breach of their duties under Article 74 was 10 years. While this decision is not binding on the Jersey courts, it is likely to carry considerable weight.

Guernsey Register of Beneficial Ownership: what you need to know
Guernsey | October 30 2017

The Beneficial Ownership of Legal Persons (Guernsey) Law 2017 came into force on August 15 2017. From that date, the incorporation or creation of any Guernsey entity requires details of its beneficial owner to be submitted to the Guernsey registrar of beneficial ownership of legal persons. Existing Guernsey entities must do the same by October 31 2017, with the exception of companies, which have until February 2018.

Companies Law: migrations into and out of Guernsey
Guernsey | December 12 2016

The Companies Law contains provisions relevant to the migration of companies into and out of Guernsey. For example, whether migrating into or out of Guernsey, the law requires a formal application to migrate to be made to the registrar of companies. However, where a company intends to be or is already a 'supervised company' – that is, a company which requires regulation by the Guernsey Financial Services Commission – written consent from the commission must be obtained.

Competition & Antitrust

CICRA issue new merger control guidance
Guernsey | September 28 2017

The Channel Islands Competition and Regulatory Authorities (CICRA) have issued new guidance on the process for obtaining their approval of a notifiable merger or acquisition in the Channel Islands. The guidance implements some procedural aspects of the recommendations for the islands' merger control regime overhaul which CICRA published in September 2016.

Employment & Benefits

Disability to be a protected characteristic under Jersey discrimination law
Jersey | May 23 2018

Effective from September 1 2018, the Discrimination (Jersey) Law 2013 will be amended to include disability as a protected characteristic. The amending regulations will give individuals the right to complain to the Employment and Discrimination Tribunal when they believe that they have experienced discrimination. While many employers and groups will be familiar with the way that the regulations work, they should be taking steps to ensure that they are compliant ahead of the implementation date.

Harvey Weinstein and you: what employers should be doing about sexual harassment
Guernsey | March 07 2018

What started with complaints against an Oscar-winning film producer has led to a movement that has toppled government ministers and reduced much-loved figures from the entertainment world to pariahs. Although Guernsey may feel far away from Hollywood or Westminster, the issue of sexual harassment is just as real. So what should an employer do to protect its employees and its business from harassment?

Can I enforce a dress code at work?
Jersey | February 21 2018

Employers can enforce dress codes only within the confines of the discrimination law. For example, a requirement for a female receptionist to wear high heels is illegitimate since no equivalent requirement is placed on male employees. Employers that want to enforce a dress code should consider the discrimination law and whether their proposals meet it. A recent Jersey case illustrates how this works.

Are you too interested in former employees' post-termination restrictions?
Jersey | November 08 2017

Lawyers are often asked to review employment contracts, including post-termination restrictions. It is increasingly common to see covenants that either restrict the former employee from holding any interest in a competing business or limit the amount of shareholding that they can have. If a contract uses this language, it could lead to the entire restrictive covenant being unenforceable.

£10,000 compensation cap applies per complaint, not per overall claim
Jersey | October 26 2016

A recent Jersey Employment and Discrimination Tribunal case has provided guidance on the Discrimination (Jersey) Law 2013. The case highlights some important points for businesses to remember, including that the £10,000 limit per complaint applies to each type of complaint (ie, direct discrimination, indirect discrimination or harassment).

IT & Internet

General Data Protection Regulation in Jersey: what is it, why should I care and what should I do about it?
Jersey | April 04 2017

While the media's attention has recently been lavished on Brexit and President Trump, there is one news story that will affect businesses across Jersey sooner than might be expected: the implementation of the General Data Protection Regulation. Jersey businesses must ensure that they comply with the new regulation when it comes into force in May 2018. That means starting work now to assess the impact of the regulation and decide what changes will be needed to ensure compliance.

Insolvency & Restructuring

Cross-border insolvency and restructuring
Jersey | August 03 2018

As a jurisdiction, Jersey is at the heart of cross-border insolvency and restructuring. Inevitably, situations arise where insolvent companies' assets or important evidence are located overseas, or an overseas liquidation regime would be best for creditors. Conversely, there will be situations where a foreign insolvency process requires steps to be taken in Jersey.

Reinstatement of a company
Jersey | November 03 2017

The procedure governing the reinstatement of a dissolved Jersey limited company is contained in the Companies (Jersey) Law 1991. Where a company has been dissolved or, most commonly, struck off the register by the registrar of companies after failing to file an annual return, the Royal Court has the power to declare the dissolution void and order the reinstatement of the company.

First appointment of provisional liquidator in Royal Court
Guernsey | July 07 2017

A recent Royal Court judgment is important as it appears to be the first time that a provisional liquidator has been appointed by the court over a solvent Guernsey company. This case adds helpful guidance to the Guernsey insolvency regime as it demonstrates that the Royal Court adopts a pragmatic and flexible approach when exercising its discretion, particularly where the parties face unusual circumstances.

Practice and trends in restructuring and insolvency law
Jersey | May 26 2017

Jersey has a familiar range of legal processes and remedies for the restructuring and insolvency of corporations. While certain reforms are often discussed, Jersey seeks to position itself as a jurisdiction with a system in which creditors can have confidence. Further, the Royal Court has been willing to engage in cross-border insolvencies, whether by granting recognition to overseas office holders or seeking assistance from other jurisdictions.

Litigation

Important changes to civil procedure
Jersey | August 14 2018

In Summer 2017 Jersey's Royal Court Rules were amended and 11 new practice directions came into force. These aim to improve access to justice, streamline the civil justice process and, where possible, reduce the risks and costs associated with litigation by encouraging the early resolution of cases to avoid court proceedings.

Private Client & Offshore Services

Refusal of consent under AML reporting regime: Royal Court weighs in
Guernsey | August 16 2018

The Financial Intelligence Service's recent refusal to consent to a proposed transaction under Guernsey's anti-money laundering reporting regime has resulted in the Royal Court deciding its first private law action between the person claiming the asset and the financial institution holding it. The decision clarifies the legal framework for determining the source of funds, which will be highly relevant to all regulated entities in Guernsey.

Important changes to civil procedure
Jersey | August 09 2018

In Summer 2017 Jersey's Royal Court Rules were amended and 11 new practice directions came into force. These aim to improve access to justice, streamline the civil justice process and, where possible, reduce the risks and costs associated with litigation by encouraging the early resolution of cases to avoid court proceedings.

Court rules on limitation period for breach of directors' duties
Jersey | August 09 2018

The Jersey limitation period for claims against directors for breach of duty under Article 74 of the Companies (Jersey) Law 1991 has not been definitively decided by the Jersey Royal Court. However, the UK High Court recently found that the prescription period for claims against directors of Jersey companies for breach of their duties under Article 74 was 10 years. While this decision is not binding on the Jersey courts, it is likely to carry considerable weight.

Reform of civil forfeiture orders
Jersey | August 02 2018

MONEYVAL's 2015 inspection of Jersey's anti-money laundering regime and its subsequent report issued in May 2016 encouraged Jersey legislators and regulators to actively prosecute more financial crime and, in particular, introduce a non-conviction-based confiscation regime to apply in parallel with the conviction-based system. The Draft Forfeiture of Assets (Civil Proceedings) Jersey Law is a paradigm shift in regulatory approach to achieve the objectives set by MONEYVAL.

Cross-border insolvency and restructuring
Jersey | August 02 2018

As a jurisdiction, Jersey is at the heart of cross-border insolvency and restructuring. Inevitably, situations arise where insolvent companies' assets or important evidence are located overseas, or an overseas liquidation regime would be best for creditors. Conversely, there will be situations where a foreign insolvency process requires steps to be taken in Jersey.

Disability to be a protected characteristic under Jersey discrimination law
Jersey | May 17 2018

Effective from September 1 2018, the Discrimination (Jersey) Law 2013 will be amended to include disability as a protected characteristic. The amending regulations will give individuals the right to complain to the Employment and Discrimination Tribunal when they believe that they have experienced discrimination. While many employers and groups will be familiar with the way that the regulations work, they should be taking steps to ensure that they are compliant ahead of the implementation date.

At a glance: guide to Jersey's new charity law
Jersey | May 17 2018

The next phase of the Charities (Jersey) Law 2014 was enacted on May 1 2018, allowing entities to finally register as charities under the law. The remaining provisions of the law are expected to come into force on January 1 2019, which will amend Jersey taxation legislation in relation to charities. This is an exciting opportunity for Jersey to reinforce and develop its status as a centre of excellence for philanthropy both in private wealth management and impact investing.

Changes to JFSC codes of practice
Jersey | April 05 2018

The revised Jersey Financial Services Commission codes of practice came into force on March 21 2018. As a matter of urgency, regulated businesses should therefore review the changes to the codes and consider whether any new implementation measures are necessary. The changes to the codes have considered industry feedback and include both new and revised regulations to align Jersey with the Group of International Finance Centre Supervisors standard.

Generation games and avoiding family disputes
Jersey | April 05 2018

The use of private trust companies is becoming more common as a method of retaining family control through the generations. This, of course, all needs to be balanced against tax and reporting considerations, as well as practical ones. That said, however good the adviser, it is difficult to plan for family disputes; therefore, the main emphasis should be on maintaining flexibility so that the trustee can react to changes of circumstances and wealth passing through the generations.

Capacity and Self-Determination (Jersey) Law
Jersey | March 29 2018

The Capacity and Self-Determination (Jersey) Law, which is due to come into effect in October 2018, will give people the opportunity, while they still have the capacity, to make their own decisions regarding their financial and personal affairs and welfare. It provides a framework that will give people the opportunity to make their own decisions in respect of medical treatment insofar as possible, including advance decisions to refuse treatment.

JFSC Supervision Examination Guide
Jersey | March 29 2018

The Jersey Financial Services Commission (JFSC) recently published its Supervisory Examination Guide. The guide, which is effective immediately, gives a detailed overview of the supervisory examinations conducted by the JFSC. Examinations are a key tool used by the JFSC to detect and deter breaches of regulatory standards and improve compliance.

What inheritance rights does an adopted child have?
Jersey | March 01 2018

An adopted child is treated in law as the biological child of his or her adoptive parents and not the child of any other person. In terms of inheritance, this means that any reference to 'children' in adoptive parents' will or wills includes adopted children. If the parents do not leave a will or wills, the adopted child will have the same legal right to benefit from their estates as any biological child would have.

Buying Jersey property with a partner who has no housing qualifications
Jersey | March 01 2018

An unmarried couple, both with housing qualifications, can buy property in joint names and have the security of jointly owning their home. For unmarried couples where only one partner has housing qualifications, the position is more difficult. For freehold property, only the qualified partner can own it. It is therefore important that couples in this situation enter into an equity agreement in order to protect the unqualified partner's position so far as legally possible.

Harvey Weinstein and you: what employers should be doing about sexual harassment
Guernsey | March 01 2018

What started with complaints against an Oscar-winning film producer has led to a movement that has toppled government ministers and reduced much-loved figures from the entertainment world to pariahs. Although Guernsey may feel far away from Hollywood or Westminster, the issue of sexual harassment is just as real. So what should an employer do to protect its employees and its business from harassment?

The importance of trustee minutes
Guernsey | February 22 2018

In today's climate, in which professional trustees are held to increasingly high standards by regulators, courts and clients, it has never been more important for fiduciaries to record their decisions. A court's ruling may turn on the content of trustee minutes, and regulatory authorities are entitled to scrutinise all available evidence of a licensee's conduct in assessing its corporate governance and compliance with anti-money laundering and counter-terrorist financing legislation.

How to handle assets in a client's estate
Jersey | February 22 2018

Jersey is a separate legal jurisdiction from the United Kingdom, with a separate body of law. Many clients do not realise this, which can cause issues when it comes to administering their estates. The law of succession and probate in Jersey differs significantly from that in the United Kingdom and creates responsibilities for the executors and administrators of those who leave behind assets in Jersey.

Can I enforce a dress code at work?
Jersey | February 22 2018

Employers can enforce dress codes only within the confines of the discrimination law. For example, a requirement for a female receptionist to wear high heels is illegitimate since no equivalent requirement is placed on male employees. Employers that want to enforce a dress code should consider the discrimination law and whether their proposals meet it. A recent Jersey case illustrates how this works.

Probate for residents: what you need to know
Jersey | February 15 2018

Many people do not realise what is involved in administering a person's estate until they have to do it themselves and they encounter a minefield of previously unknown terminology and complex legal procedures. For example, in Jersey, 'probate' is the term used for both the grant of probate itself and the process of applying for the right to deal with the estate of someone who has passed away.

Legislative changes to look out for in 2018: a Q&A
Jersey | February 15 2018

The Capacity and Self-Determination (Jersey) Law 2016, due to come into effect in April 2018, will be a long overdue update to the old customary laws. This new law will give people the opportunity, while they still have capacity, to make decisions regarding their financial and personal affairs and welfare which will take effect should they lose capacity. There are also likely to be amendments to the Wills and Succession (Jersey) Law 1993, which was the subject of an independent report in 2015.

Anti-anti-suit injunctions
Guernsey | February 01 2018

An anti-anti-suit injunction is a relatively rare form of anti-suit injunctive relief granted by a particular court in order to stop a party from pursuing an application for an anti-suit injunction in another court. In a recent decision, the Guernsey Court of Appeal stated that "particular caution" should be applied in granting an anti-anti-suit injunction.

Funds litigation: Guernsey on map after £1 billion, seven-year case
Guernsey | December 21 2017

The Royal Court recently issued its judgment on what is thought to be the largest civil case in Guernsey's history. The decision has cleared a Guernsey investment fund that went into insolvency in the wake of the financial crash in 2008 of liability over its collapse. The scale of the case underlines Guernsey's position as not only one of the world's largest offshore finance centres, but also a venue capable of handling complex and demanding funds litigation cases.

Resigned trustee wins court approval for reappointment – what this means for trusts industry
Jersey | December 21 2017

The Royal Court recently assessed a case where the representor of a trust had sought to retire as trustee and provided the notice required under the terms of the trust to the company. Despite the fact that the trustee had reminded the company, no replacement was lined up when the company was dissolved. The case focused on the distinction between a trustee's fiduciary responsibilities and its powers and discretions provided for by the terms of a trust.

Scope of powers for trustee in bankruptcy where concurrent domestic insolvency proceedings exist
Guernsey | December 07 2017

The recognition of the powers of an English trustee in bankruptcy in Guernsey is generally pursued either by way of a letter of request issued by the foreign court or an application via common or customary law. A recent decision examines the position – not previously encountered in Guernsey – of an application for recognition under common law in a situation where there were already désastre proceedings in Guernsey.

Providence: Royal Court approves litigation funding agreement
Guernsey | November 16 2017

The Royal Court recently considered, for the first time in open court, the issue of whether an agreement with a third party to fund litigation would be void as a matter of Guernsey law on the basis that it was champertous. The lieutenant bailiff's judgment provides valuable guidance as to the contractual provisions that should be considered when third-party funding takes place.

Are you too interested in former employees' post-termination restrictions?
Jersey | November 09 2017

Lawyers are often asked to review employment contracts, including post-termination restrictions. It is increasingly common to see covenants that either restrict the former employee from holding any interest in a competing business or limit the amount of shareholding that they can have. If a contract uses this language, it could lead to the entire restrictive covenant being unenforceable.

Listed funds: a Q&A
Guernsey | November 02 2017

An 'investment fund' refers to any vehicle which allows investors to pool their money for investment by an investment manager in accordance with a defined investment policy. A 'listed' fund is an investment fund which has been admitted to trading and/or listing on a stock exchange. There are many reasons to establish a fund, including exposure to assets not otherwise available to single investors.

Reinstatement of a company
Jersey | November 02 2017

The procedure governing the reinstatement of a dissolved Jersey limited company is contained in the Companies (Jersey) Law 1991. Where a company has been dissolved or, most commonly, struck off the register by the registrar of companies after failing to file an annual return, the Royal Court has the power to declare the dissolution void and order the reinstatement of the company.

Guernsey Register of Beneficial Ownership: what you need to know
Guernsey | October 26 2017

The Beneficial Ownership of Legal Persons (Guernsey) Law 2017 came into force on August 15 2017. From that date, the incorporation or creation of any Guernsey entity requires details of its beneficial owner to be submitted to the Guernsey registrar of beneficial ownership of legal persons. Existing Guernsey entities must do the same by October 31 2017, with the exception of companies, which have until February 2018.

Setting aside subsequent transfers to trusts – statutory law of mistake in operation
Jersey | October 26 2017

The enactment of the Trust (Amendment 6) (Jersey) Law 2013 saw Jersey introduce a statutory basis for relief to be granted for mistake in the form of Article 47E of the Trusts (Jersey) Law 1984. Although there have been a number of Royal Court decisions in this area since then, a recent decision represents the first time that the court has granted relief for mistake squarely within Article 47E.

Trust variation to benefit children of same-sex and unmarried parents – facts, considerations and implications
Jersey | October 19 2017

A recent Jersey Royal Court decision provides welcome guidance with respect to Article 47 applications to vary a trust. In particular, the court considered the interplay between a settlor's wishes and the court's assessment of 'benefit', a point which it had never previously considered. The decision also examines Article 47 applications alongside public policy considerations affecting a modern society.

Ongoing responsibilities under Register of Beneficial Ownership and Control
Jersey | October 19 2017

The deadline recently passed for legal entities to file details of beneficial ownership and control with Jersey's Companies Registry. Under the revised rules, even if there had been no change to the relevant information since incorporation, legal entities were still required to file the relevant form. While the deadline for the initial disclosure has passed, there are ongoing compliance obligations for affected entities to keep in mind.

CICRA issue new merger control guidance
Guernsey | September 28 2017

The Channel Islands Competition and Regulatory Authorities (CICRA) have issued new guidance on the process for obtaining their approval of a notifiable merger or acquisition in the Channel Islands. The guidance implements some procedural aspects of the recommendations for the islands' merger control regime overhaul which CICRA published in September 2016.

Tax residency of Jersey companies – reminder and update
Jersey | September 21 2017

A recent UK tax case involving three Jersey companies sounds a note of caution with regard to interaction between offshore subsidiaries and UK parent companies and the role of directors. The case serves as a timely reminder that Jersey resident directors cannot provide a purely 'administrative' service for the benefit of the parent owner.

Development in use and role of protectors
Guernsey | August 03 2017

A protector – whether it is an individual, a corporate or a committee – can be highly valuable in assisting with the administration of a trust. Recent Royal Court judgments have clarified the position of protectors in Guernsey trusts law – in particular, the background and recent developments to the roles of protectors, as well as the thought required in appointing a suitable protector.

FURBS and firewalls
Guernsey | July 27 2017

A recent Royal Court case involved a funded unapproved retirement benefits scheme (FURBS) – a type of Guernsey trust which holds assets of significant value for the benefit of the sole member of the FURBS and, if he or she dies, for the benefit of his or her spouse. In this case, the husband and wife were going through a divorce in England and the wife sought to join the trustee into the family proceedings for the purposes of disclosure – that is, she wanted to know what assets were vested in the trust.

Novel use of provisional liquidator in Royal Court
Guernsey | July 06 2017

A recent Royal Court judgment is important as it appears to be the first time that a provisional liquidator has been appointed by the court over a solvent Guernsey company. This case adds helpful guidance to the Guernsey insolvency regime as it demonstrates that the Royal Court adopts a pragmatic and flexible approach when exercising its discretion, particularly where the parties face unusual circumstances.

Ultra-high-net-worth clients and the call for bespoke structuring
Jersey | July 06 2017

According to a 2016 report, 212,615 individuals in the world hold a total of over $30 trillion in wealth. By 2020 the number of ultra-high-net-worth individuals is anticipated to reach 318,000 with compound annual growth of 9%. It seems clear that clients will continue to want structuring options in stable and established jurisdictions. This means that Jersey remains an attractive proposition for Middle East and Far East ultra-high-net-worth individuals.

Infrastructure funds can sometimes create a catch-22
Guernsey | June 29 2017

From a structuring perspective, infrastructure funds are most frequently established as either a limited partnership or a limited company. Partnerships are the familiar vehicle for private funds, whereas companies will be used for listed vehicles. The ultimate structure of a fund will depend on where the assets are located, where the investors are based and how investment will be structured.

Differences between Jersey and English processes on probate and wills of real estate
Jersey | May 25 2017

Jersey's law of inheritance and probate differs significantly from that of England and creates responsibilities for the executors and administrators of those who leave movable assets in Jersey on their death. This affects inheritance and probate issues, and non-Jersey practitioners can minimise complexities and delays by taking advice and guidance on Jersey law at an early stage.

Practice and trends in restructuring and insolvency law
Jersey | May 25 2017

Jersey has a familiar range of legal processes and remedies for the restructuring and insolvency of corporations. While certain reforms are often discussed, Jersey seeks to position itself as a jurisdiction with a system in which creditors can have confidence. Further, the Royal Court has been willing to engage in cross-border insolvencies, whether by granting recognition to overseas office holders or seeking assistance from other jurisdictions.

Strategic focus on high-quality regulation continues to yield dividends
Jersey | May 18 2017

While the Panama Papers led to headlines about the offshore world, the work that has been done to carve out Jersey as a financial services centre that bases its reputation and 'sales pitch' on the strength and quality of its regulation is continuing to pay off. That work is going to continue and themes for 2017 include work for international families looking for bespoke structures to facilitate succession planning, asset protection and wealth structuring.

Jersey real estate – an investment that doesn't go out of fashion
Jersey | May 18 2017

Investment into Jersey property and, in particular, into office developments in Saint Helier, has continued to be popular. This points to an appetite for high-quality, large-scale investment properties backed by solid covenants. With the market steadily improving, the island is looking forward to increased investment activity across the investment property sector. Maintaining an attractive investment market in the context of the relevant tax principles' impact on investment will be a vital part of this.

Jersey Financial Services Commission – revised outsourcing policy
Jersey | May 11 2017

The Jersey Financial Services Commission's recently published outsourcing policy achieves much by doing away with the distinction between delegation and outsourcing, which has historically been a source of confusion for registered persons conducting financial services business in Jersey. However, it has added an extra layer of regulatory burden on registered persons and non-regulated entities alike by broadening the definition of 'outsourced' activity.

Role of non-executive directors against ever-changing regulatory backdrop
Jersey | May 11 2017

The importance of non-executive directors, while sometimes questioned, is fairly well established. The guidelines for Jersey directors go as far as to suggest that boards composed wholly of full-time executive directors are potentially weak if they become insular. Clearly the expectation is high: non-executive directors contribute something extra, something more, than executive directors alone. So what are the duties and responsibilities of non-executive directors in 2017?

Jersey private funds
Jersey | April 27 2017

With the release of the Jersey Private Funds (JPF) Guide, Jersey has introduced a welcome simplification of its funds regime by providing for a single JPF product. The JPF will replace the three existing fund products which cater to private funds in Jersey, namely Control of Borrowing (Jersey) Order only funds, private placement funds and very private funds.

Transitional period from 2008 Guernsey corporate law reform ends – what to do next
Guernsey | April 27 2017

When the Companies (Guernsey) Law was enacted, special temporary transitional rules were also enacted which allowed pre-existing Guernsey companies to retain their pre-2008 memorandum and articles and not comply with all of the provisions of the Companies (Guernsey) Law. Those transitional rules ended on December 31 2016. Accordingly, all Guernsey companies, whenever they were incorporated, must now comply with all of the Companies (Guernsey) Law.

Arrangements to deceive as to beneficial ownership will not be upheld
Jersey | April 13 2017

The Royal Court recently clarified that any arrangement which detracts from the ability of regulators or law enforcement authorities to identify beneficial owners of companies or beneficiaries of trusts will not be recognised on grounds of public policy. This judgment sends a clear message that the court will not allow regulatory and enforcement systems to be undermined by arrangements designed to mislead the relevant authorities and reiterates that attempts to do so will lead to criminal penalties.

Escaping from mistakes as to tax consequences
Guernsey | April 13 2017

The Guernsey Royal Court recently considered whether to set aside a distribution on the grounds of equitable mistake in circumstances where that mistake led to adverse UK tax consequences. In particular, the court's clear guidance that not every mistake as to tax consequences based on incorrect or negligent professional advice will be corrected by the courts is noteworthy.

What the first Jersey insolvency case of its kind in 40 years means for 'back door' to English administration
Jersey | April 06 2017

A trilogy of recent decisions concerning the high-profile insolvency of a Jersey company has provided a salutary reminder to the international insolvency community and to creditors of Jersey companies that Jersey has a sophisticated insolvency regime which will be used in cross-border insolvencies. These decisions demonstrate that it cannot be assumed that the door to UK administration is always going to be open.

Fee estimates in liquidation: importance of getting in early
Guernsey | April 06 2017

A recent decision from the Guernsey Royal Court is of fundamental importance to Guernsey insolvency practitioners as it provides cautionary guidance on the practical implications of Practice Direction 3/2015. The practical lesson to take away from the decision is that where an insolvency practitioner is faced with circumstances that appear to be out of the ordinary, a pragmatic and proactive approach must be followed to seek an increase to the cost cap as soon as possible.

General Data Protection Regulation in Jersey: what is it, why should I care and what should I do about it?
Jersey | March 30 2017

While the media's attention has recently been lavished on Brexit and President Trump, there is one news story that will affect businesses across Jersey sooner than might be expected: the implementation of the General Data Protection Regulation. Jersey businesses must ensure that they comply with the new regulation when it comes into force in May 2018. That means starting work now to assess the impact of the regulation and decide what changes will be needed to ensure compliance.

How to deal with assets left in Jersey by a deceased UK resident
Jersey | March 23 2017

A formal grant of probate issued in the United Kingdom is not sufficient to release assets held in Jersey unless the Jersey estate is worth less than £10,000. On production of a UK grant of probate, the clerks will issue a Jersey grant of probate through a fast-track process; however, for Jersey property, a will that has been court-sealed and certified in accordance with Jersey law is required.

Country-by-country reporting – Jersey legislation
Jersey | March 23 2017

The States of Jersey recently passed the country-by-country reporting regulations in order to demonstrate Jersey's commitment to the Organisation for Economic Cooperation and Development's Base Erosion and Profit Sharing project. Among other things, the regulations require Jersey entities and, where applicable, constituent entities to notify and, if required, to file a country-by-country report.

Country-by-country reporting – Guernsey legislation
Guernsey | March 23 2017

The Channel Islands have demonstrated their commitment to the Organisation for Economic Cooperation and Development's Base Erosion and Profit Sharing project by introducing local regulations to ensure that country-by-country reporting is conducted in accordance with the minimum requirements prescribed by the project. Guernsey's regulations require constituent entities which are resident for tax purposes in Guernsey to notify and, if required, to file a country-by-country report.

Investment funds outlook for Channel Islands in 2017
Guernsey | March 16 2017

Whereas 2016 brought controversy and uncertainty, 2017 promises to be a much more positive year, especially from the perspective of the investment funds industry in the Channel Islands. Statistics from 2016 show 12.3% growth in the net asset value of funds under management and administration in Guernsey. These numbers are encouraging and serve as a starting point for the year to come.

Jersey funds legal and regulatory quarterly update
Jersey | January 26 2017

Among other developments in the legal and regulatory sector, the Jersey Financial Services Commission (JFSC) recently issued a consultation paper in relation to the proposed rationalisation and consolidation of Jersey's private funds and unregulated funds regimes. The JFSC also recently received feedback regarding whether Jersey should introduce a regime equivalent to the EU Markets in Financial Instruments Directive.

Lessons to be learned from recent Guernsey regulatory matter
Guernsey | December 15 2016

A bank made a suspicious activity report to the Financial Investigation Unit due to its concerns about the potential source of funds in an account. The concerns were raised due to two articles which had been discovered in the public domain relating to an individual and his conviction by a Brussels court for value added tax fraud. It was the bank's belief that the individual was primarily the source of wealth for the account, but it did not know whether the funds were the proceeds of crime.

Companies Law: migrations into and out of Guernsey
Guernsey | December 08 2016

The Companies Law contains provisions relevant to the migration of companies into and out of Guernsey. For example, whether migrating into or out of Guernsey, the law requires a formal application to migrate to be made to the registrar of companies. However, where a company intends to be or is already a 'supervised company' – that is, a company which requires regulation by the Guernsey Financial Services Commission – written consent from the commission must be obtained.

Innovation islands – how the Channel Islands are innovating in funds arena
Guernsey | December 08 2016

The Channel Islands' funds sector is a product of the success of innovation in the islands. In particular, Guernsey has already adopted an innovative, manager-led product scheme that reduces compliance duplication by focusing attention on managers and not underlying funds. This manager-led product scheme could be another game changer in reducing costs both at the fund formation stage and throughout the life of the fund.

Court sets aside subsequent transfers due to mistake
Jersey | November 10 2016

The Royal Court recently applied Jersey's statutory mistake provisions for the first time in order to set aside transfers of shares to Jersey trusts, which had been made a number of years after the trusts were established and in circumstances where the mistake gave rise to contingent, rather than crystallised, tax liability. The court also clarified that, notwithstanding the fact that foreign law governed the transfers, the question of their validity had to be determined under Jersey law.

Virtual currency regulation takes effect
Jersey | October 27 2016

The value and volume of virtual currency trading is skyrocketing globally, but regulating virtual currencies and virtual currency exchangers is challenging. Under the new Proceeds of Crime (Miscellaneous Amendments) (Jersey) Regulations 2016, exchangers must comply with the island's anti-money laundering and terrorist financing laws, regulations, policies and procedures.

Dishonest or fraudulent breaches of duty know no limits
Jersey | October 27 2016

Limitation is a perennial concern for plaintiffs, and knowing when time started to run is particularly troublesome where plaintiffs were unaware of their potential claim due to a lack of information or, worse, dishonesty. The Royal Court recently indicated that neither a trustee of an express trust nor a fiduciary who has acted dishonestly in breach of his or her trust or fiduciary duties can successfully plead a limitation defence.

£10,000 compensation cap applies per complaint, not per overall claim
Jersey | October 20 2016

A recent Jersey Employment and Discrimination Tribunal case has provided guidance on the Discrimination (Jersey) Law 2013. The case highlights some important points for businesses to remember, including that the £10,000 limit per complaint applies to each type of complaint (ie, direct discrimination, indirect discrimination or harassment).

Welcome to the virtual currency sandbox: let's play
Jersey | October 20 2016

While virtual currencies may divide opinion, it is undeniable that they are booming and becoming part of the mainstream. Jersey has answered the question of how to seize this opportunity by introducing a 'regulatory sandbox' for developers and innovators to build, test and experiment with products, services, business models and delivery mechanisms in a live environment without immediately incurring all of the normal regulatory consequences and costs.

Jersey managers and funds marketing into Europe
Jersey | September 01 2016

The European Securities and Markets Authority recently recommended that Jersey be included in the first wave of third countries whose managers can seek authorisation for the marketing passport under the EU Alternative Investment Fund Managers Directive. Once the marketing passport becomes available, Jersey will be able to offer a broad range of marketing and organisational options to managers, whether they are targeting European or global investors.

Funds legal and regulatory quarterly update
Jersey | August 25 2016

The Jersey Financial Services Commission (JFSC) recently released consultations regarding amendments to codes of practice and the potential introduction of an EU Markets in Financial Instruments Directive equivalent regime. The JFSC also sought input, among other things, on proposed changes to define key terms in order to remove the distinction between delegation and outsourcing in relation to certified funds and fund services businesses.

ESMA advises "no significant obstacles" to application of AIFMD marketing passport to Channel Islands
Jersey | August 25 2016

After much anticipation, the European Securities and Markets Authority (ESMA) has published further advice in relation to the application of the EU Alternative Investment Fund Managers Directive (AIFMD) passport. ESMA concluded that there are no significant obstacles impeding the application of the AIFMD passport to Jersey, which is one of only five jurisdictions to achieve an unqualified assessment.

Remedies for mistake under Jersey law
Jersey | July 14 2016

As a matter of law, the doctrine of mistake allows a settlor that settles property on trust to apply to the court to set aside or unwind transactions where there was a mistake on the part of the settlor, the settlor would not have entered into the transaction but for the mistake or the mistake was of so serious a nature as to render it unjust. The Royal Court recently dealt with such a case, finding that a mistake regarding the tax consequences of a transfer to a trust is considered a mistake.

Crowdfunding: an opportunity for Jersey?
Jersey | July 14 2016

Crowdfunding is a way in which individuals and businesses raise money to finance or re-finance their activities through online platforms. These online platforms are often known as 'crowdfunding platforms' and typically adopt either a loan-based model or an investment-based model to attract a broader range of individual funders. While Jersey has no crowdfunding platform, it could become one of the keys to developing Jersey's digital economy.

Continuing obligations – updates on Chapter 8 debt securities
Jersey | July 07 2016

The Channel Islands Securities Exchange (CISE) has adopted a flexible and pragmatic approach to regulation and developed listing rules that places a premium on clarity and an appropriate level of corporate governance. This update highlights the principal requirements and key issues to be considered when listing debt securities on the CISE, including recent updates to the CISE's annual fees.

Royal Court and Court of Appeal scrutiny over Guernsey Financial Services Commission sanctions
Guernsey | July 07 2016

Two recent decisions illustrate how sanctions imposed by the Guernsey Financial Services Commission are subject to the scrutiny of the Royal Court and the Court of Appeal. The decisions have revealed that there is no statutory right of appeal against the publication of a statement on the commission's website and that in assessing which sanctions to impose, the commission can consider the impact that the contravention may have on public interest.

Migration of companies in and out of Jersey
Jersey | July 07 2016

The Companies (Jersey) Law 1991 allows a company registered in a foreign jurisdiction to migrate from its home jurisdiction to Jersey. Jersey companies may also migrate to a foreign jurisdiction and continue as a foreign incorporated company. However, the procedure to migrate out of Jersey can be lengthy and thus companies must liaise with their foreign advisers to ensure that all relevant formalities are met.

Testing Jersey's firewall
Jersey | May 05 2016

The Royal Court recently considered orders made by the English Family Court in relation to a Jersey discretionary trust and therefore the operation of the so-called 'firewall' provisions contained in the Trusts (Jersey) Law 1984. The court confirmed that trustees are not prevented from taking steps which are in the best interest of their beneficiaries simply because doing so might also be seen as giving effect to a decision by a foreign court.

Funds legal and regulatory quarterly update
Jersey | April 28 2016

The Jersey Financial Services Commission (JFSC) recently delivered its 2016 Business Plan to the financial services industry, setting out the JFSC's key priorities for 2016. Further, the Jersey Common Reporting Standard (CRS) regulations, which provide details of the jurisdictions committed to the adoption of CRS, have been amended. Further amendments are expected as jurisdictions confirm their intentions.

Costs in trust proceedings – further Royal Court guidance where fiduciary powers not validly exercised
Jersey | March 24 2016

The Royal Court recently issued a judgment on the costs of proceedings, in which it reviewed and applied the key principles concerning the recoverability of costs by fiduciaries and beneficiaries in cases of this kind. The judgment shows the court's willingness to look at the substance of matters when assessing cost consequences, rather than slavishly seeking to apply categorisations or hard rules.

CISEA: Chapter 8 debt listings
Jersey | March 17 2016

The Channel Islands Securities Exchange Authority Limited (CISEA) was established with the intention of providing recognised facilities for the listing and trading of a broad range of debt securities. It currently lists equity-linked notes, convertible notes, payment-in-kind notes, eurobonds and warrants. This update highlights the principal requirements and key issues to be considered when listing debt securities on the CISEA.

Funds legal and regulatory update
Jersey | February 11 2016

The Jersey Financial Services Commission (JFSC) recently published a consultation paper which proposes amendments to various codes of practice, including to the codes' notification requirements and the way in which consumer complaints are handled. Further, the JFSC has issued regulations to give effect to the Organisation for Economic Cooperation and Development's Common Reporting Standard.

Aircraft registry established
Jersey | February 11 2016

The Jersey Aircraft Registry was launched on November 6 2015. The registry provides a platform for the registration of aircraft, as well as the creation, registration and enforcement of aircraft mortgages and aircraft engine mortgages. Further, the registry provides lenders with the opportunity to finance the lease or purchase of aircraft and aircraft engines which are registered in Jersey.

Escaping from mistakes over tax consequences in respect of Jersey trusts
Jersey | February 04 2016

The Royal Court recently considered the extent of relief available under the doctrine of mistake in Jersey trust law in circumstances where the mistake led to adverse tax consequences for the settlors. The court demonstrated the extent of the considerations that it will take into account, finding that even where a lack of financial impact existed, justice lay with setting aside the transfers and holding that the funds were held on bare trust for the settlors.

Trust removal proceedings – service out of jurisdiction and effect of administration clauses
Jersey | February 04 2016

The Royal Court recently had cause to revisit the principles applied to trust proceedings where service out of the jurisdiction is considered and construing a governing law or forum for administration clause. Although this case involved some exceptional circumstances, the Royal Court's decision demonstrates that it continues to adopt a clear analytical approach to issues surrounding where trust disputes should be heard.

Transfers of long-term insurance business
Guernsey | January 21 2016

The transfer of any long-term insurance business in Guernsey is governed by the Insurance Business (Bailiwick of Guernsey) Law, which states that any such transfer must be sanctioned by an order of the Royal Court. It is often the case that an application made in Guernsey for the transfer of long-term business is made in conjunction with similar applications made simultaneously in other jurisdictions.

Channel Islands Securities Exchange introduces SPAC listing product
Jersey | December 10 2015

The rules for listing debt securities on the Channel Islands Securities Exchange contain requirements and features for special purpose acquisition companies, including shares, trading and share rights, obligations for management and directors, requirements in relation to escrow and expenses and requirements during acquisitions.

Funds legal and regulatory update
Jersey | November 12 2015

The European Securities and Markets Authority recently concluded that no obstacles exist in relation to the extension of the Alternative Investment Fund Managers Directive's passporting regime to Jersey. Further, the definition of 'alternative investment funds' in the Alternative Investment Funds (Jersey) Regulations 2012 has been amended to include limited partnerships registered in England or Scotland, under certain conditions.

Continuing obligations – Chapter 8 debt securities updated
Jersey | November 05 2015

Company directors that have or are listing debt securities under Chapter 8 of the Listing Rules should be aware of the continuing obligations that issuers must observe once any of their securities have been admitted to listing. This update sets out these continuing obligations, including general disclosure obligations, the duty to notify and annual fees.

Royal courts approve cross-border pooling of insolvent companies' assets and liabilities
Jersey | October 29 2015

The Royal Courts of Guernsey and Jersey recently held that where the affairs of two insolvent companies (incorporated in Jersey and Guernsey, respectively) are so intermingled that the expense of unravelling them would adversely affect distributions to creditors, the companies may be treated as a single entity. These decisions represent a welcome development in cross-bailiwick cooperation and insolvency and restructuring law.

No alternative: when can a trustee surrender its discretion to the court?
Jersey | October 08 2015

In a recent case before the Royal Court, the trustee was concerned that there was a conflict of interest between limiting its liability and its duties to the trust. As such, it sought to surrender its discretion to the court in relation to the powers outlined in the divorce agreement. The court accepted that no sensible alternative existed and thus granted the surrender. This judgment serves as a reminder that trustees should investigate whether any sensible alternatives exist before proceeding.

Dormant account law to be introduced
Jersey | October 01 2015

Banks may soon be able to close dormant bank accounts by depositing the account balance into a central fund. Any money that is not reclaimed from the fund will be used for charitable and social purposes. The draft law will allow banks to remove the liabilities associated with dormant accounts from their balance sheets.

Application to vary a trust under Trusts (Jersey) Law 1984
Jersey | October 01 2015

The Royal Court was recently asked to approve variations to a settlement on behalf of the settlement's minor, unborn and unascertained beneficiaries in accordance with the Trusts (Jersey) Law 1984. In finding that the variations in question were for the benefit of the relevant beneficiaries, the court demonstrated that tax planning and the management of trust funds may also be considered benefits under the act.

Treatment of companies managed outside Jersey
Jersey | September 24 2015

In light of the United Kingdom's plans to reduce its corporation tax rate, the Jersey government recently announced its commitment to identifying appropriate legislative changes to ensure that Jersey companies managed and controlled in the United Kingdom or elsewhere will not be deemed resident in Jersey. While these changes have not yet been identified, they are expected to include a reduction of Jersey's 20% corporation tax rate.

The ombudsman cometh – update
Jersey | September 24 2015

Jersey's first Financial Services Ombudsman will begin investigating and resolving complaints on November 16 2015. Once the ombudsman scheme is in operation, the ombudsman will adjudicate complaints from individual customers in relation to financial services provided in Jersey and will be able to make awards to return complainants to the position in which they would have been had the problem not occurred.

Tracing a new path: the final word
Jersey | September 17 2015

The Privy Council has handed down a landmark judgment concerning the doctrine of tracing, which confirms the approach taken by the Royal Court and the Jersey Court of Appeal regarding the previously unsettled question of whether so-called 'backwards tracing' is permissible under Jersey law. For those holding assets for others, this judgment underlines the importance of understanding the ultimate source of funds received.

Family-friendly rights and sex discrimination
Jersey | September 17 2015

Statutory provisions recently came into force which grant employees family-friendly rights – including maternity leave, paternity leave and the right to request flexible working – for the first time. These rights came into effect at the same time as sex discrimination legislation. If employers are flexible with regard to these rights, they can use them to manage their workforce effectively.

Company Law amendments
Guernsey | September 03 2015

New amendments to the Companies (Guernsey) Law 2008 will enter into force on September 3 2015 following approval by the States of Guernsey. Transitional regulations will assist this change process. Key amendments include simplifying the distribution process and providing greater certainty in relation to its operation, and allowing certain companies to waive the requirement to prepare directors' reports if members pass a waiver resolution.

A guide to Jersey property unit trusts
Jersey | August 27 2015

Jersey property unit trusts (JPUTs) are frequently used to acquire and hold interests in UK commercial real estate, due to the ease with which they can be established and the fiscal advantages that they can offer. These fiscal advantages, combined with the flexibility to tailor the terms of the trust instrument in order to meet commercial and operational requirements, are key to the popularity of JPUTs.

Reduction of capital by Jersey companies
Jersey | July 30 2015

One of the many improvements made by the Companies (Amendment 11) (Jersey) Law 2014 was to allow Jersey companies to carry out a reduction of capital without court approval. While the old mechanism for court approval is still in place, the new procedure allows Jersey companies to reduce their capital accounts more easily and supplements their ability to distribute from certain capital accounts.

Jersey trusts and divorce – submission and exclusion
Jersey | July 16 2015

Two linked Jersey Royal Court judgments have provided further insight into the court's exercise of its supervisory jurisdiction over Jersey trusts in relation to trustees faced with overseas divorce proceedings concerning members of the beneficial class. The trustee sought the court's blessing for two momentous decisions: to submit to the jurisdiction of an overseas divorce court and to exclude the wife as a beneficiary.

Update on civil liability for breaches of codes of practice
Jersey | July 09 2015

The Financial Services Commission (Jersey) Law 1998 was recently amended to include provisions that enable the Jersey Financial Services Commission to impose civil financial penalties for material contraventions of the codes of practice and the Anti-money Laundering and Counter-terrorist Financing Handbook. If they have not already done so, registered persons should conduct a thorough gapping analysis to ensure compliance with the higher standards.

Review of 2014 amendments to substantive offences under Proceeds of Crime Law
Jersey | May 21 2015

The reform of Jersey's anti-money laundering (AML) practices and laws has been high on the legislative agenda, particularly after Jersey became a member of the Committee of Experts on the Evaluation of Anti-money Laundering Measures and the Financing of Terrorism (Moneyval). As such, the Jersey Financial Services Commission has introduced new laws in order to strengthen the AML framework and ensure that it is in line with the Moneyval recommendations.

Jersey probate where no Jersey assets?
Jersey | April 23 2015

A recent Royal Court decision regarding the estate of an individual who died domiciled in Jersey with unadministered assets in Australia has affirmed that the court will direct the judicial greffier to issue a grant of representation in instances where, although there is no Jersey estate requiring administration, the administration of the deceased's estate in other jurisdictions would be adversely affected by the refusal to issue a grant.

New Charities Law – bright new dawn
Jersey | April 16 2015

Certain parts of the new Charities (Jersey) Law 2014 recently came into force. This represents a quantum leap forward for Jersey in the charity field, as the law has introduced a new test to determine what is considered charitable, has created the post of charity commissioner and the charity tribunal and will introduce standards by which charities operating in Jersey must abide.

White Collar Crime

Refusal of consent under AML reporting regime: Royal Court weighs in
Guernsey | August 20 2018

The Financial Intelligence Service's recent refusal to consent to a proposed transaction under Guernsey's anti-money laundering reporting regime has resulted in the Royal Court deciding its first private law action between the person claiming the asset and the financial institution holding it. The decision clarifies the legal framework for determining the source of funds, which will be highly relevant to all regulated entities in Guernsey.

Reform of civil forfeiture orders
Jersey | August 06 2018

MONEYVAL's 2015 inspection of Jersey's anti-money laundering regime and its subsequent report issued in May 2016 encouraged Jersey legislators and regulators to actively prosecute more financial crime and, in particular, introduce a non-conviction-based confiscation regime to apply in parallel with the conviction-based system. The Draft Forfeiture of Assets (Civil Proceedings) Jersey Law is a paradigm shift in regulatory approach to achieve the objectives set by MONEYVAL.