The apparently relentless war waged against offshore financial centres in recent years has hit at the businesses of many of the world’s offshore financial centres. But the offshore jurisdictions are nothing if not resourceful, and while initiatives such as the Organisation for Economic Cooperation and Development’s ‘harmful tax regimes’ campaign and, more recently, the European Union’s (EU’s) Savings Tax Directive have deprived the offshore financial centres of some income streams, particularly in the private client area, other forms of offshore work have been booming. Just as one door is closed on them by onshore tax authorities and regulators, another opens; most recently this has come in the form of investment funds work.
In September, GuernseyFinance, the promotional body for the island’s finance industry, announced that the value of funds under administration in Guernsey had leapt by 37% in the space of 12 months to just under £115bn. This announcement followed similar growth in Jersey, where assets under administration surged by 32% in 2005, while the number of funds domiciled in the Cayman Islands grew by almost 20% in the same period to 7,160, according to the Cayman Islands Monetary Authority.
