In our latest webinar, Philip Hendy, head of Real Estate for CSC Jersey, and Shane Hugill, head of Executive Compensation Services for CSC Jersey, discussed Jersey’s position as a major international finance center.
Lying off the coast of northern France and just an hour’s flight from London Heathrow, Jersey benefits from being adjacent to but distinct from both the U.K. and the E.U. Jersey is a go-getting, forward-thinking place. Financial services are at the heart of its economy, contributing 40% of the island’s economic output.[1]
The small island, with a population of around 103,000,[2] has been a leading international financial center (IFC) for more than six decades. Part of the reason for that success is an independent, entrepreneurial spirit born of its history and geography. In many ways, it mirrors other IFCs, but also offers a series of distinctive features and benefits to international investors.
In the most recent webinar in our new limited series, the panel for Doing Business Internationally: Jersey discussed the appeal of Jersey for funds and businesses, and its expertise in areas such as managed executive compensation schemes.
Solid foundations for Jersey financial services
Jersey is politically unique in that it’s a crown dependency of the U.K. but with the freedom to make its own laws. Its self-governance has allowed it to create a favorable environment for financial services. It’s politically and economically stable, with a skilled workforce made up of Jersey natives and professionals from around the world. Nearly 14,000 islanders[3] are employed in a financial services sector that includes major banking and administrative outsourcing hubs.
Jersey is well regulated and internationally compliant. It’s recognized as a leading jurisdiction for tax information sharing. Personal and business taxes are low. For investors, tax neutrality is at the heart of the island’s appeal. It means that investors and companies are not taxed beyond what’s due in their home jurisdictions. This significantly cuts the administrative load for investors who want to pool funds. Institutions and individuals with different tax liabilities can invest side by side, without the risk of double taxation or undue regulatory scrutiny.
An optimal regulatory environment for special purpose vehicles through JPUTs and Jersey LLCs
Jersey is continually innovating as it seeks to attract international investors. One example is its commitment to sustainability. By 2030, Jersey’s vision is to be recognized as the leading sustainable IFC in the markets it serves.[4] Another example is the recent introduction of the Jersey Limited Liability Company (Jersey LLC) fund structure. This is a tax-transparent structure for Jersey and U.K. tax, but importantly it can be treated as either a partnership or company for U.S. tax purposes. It provides familiarity and comfort to U.S. managers looking for an entry point to Europe. The Jersey LLC joins a comprehensive range of structures, including standard companies, and general and limited partnerships.
In addition, Jersey property unit trusts (JPUTs) are designed for real estate holdings, while Jersey trusts split legal and beneficial ownership and are popular vehicles for family wealth and the assets of employee compensation schemes. Importantly the regulatory systems, such as Jersey private funds and Jersey expert funds, find a favorable balance between cost, flexibility, and investor protection.
Expertise in executive compensation through Jersey trusts
Trusts are popular for holding assets as part of executive compensation schemes, and Jersey is home to a highly developed outsourcing sector serving this market. Businesses are using ever more sophisticated compensation programs to attract and motivate key people.
Jersey finance: The complete package
Jersey is a stable, well-regulated, and innovative location for doing business. The government actively promotes financial services on the island, helping to make Jersey something of a Goldilocks destination for professional investors. Regulation is protective but not overly burdensome, and managers have a wide choice of flexible, cost-effective structures. A focus on sustainability will help Jersey future-proof its position as a major global player in financial services.
Why CSC?
CSC offers a full suite of corporate services in Jersey, from entity formation to liquidation, and everything in between.
CSC provides knowledge-based solutions for every phase of the business life cycle, helping businesses form entities, maintain compliance, execute transaction work, and support real estate, M&A, and other corporate transactions in hundreds of U.S. and international jurisdictions.
We work with some of the world’s largest banks and commercial lenders to reduce risk in their lien portfolios, improve their transaction speeds, and create a secure environment for their financial processing needs. We also provide solutions for secure real estate document preparation and recording.
We are the trusted partner for 90% of the Fortune 500®, nearly 10,000 law firms, and more than 3,000 financial organizations. Headquartered in Wilmington, Delaware, USA, since 1899, we are a global company capable of doing business wherever our clients are—and we accomplish that by employing experts in every business we serve. Missed this webinar? Watch it on-demand and register for the full series here.