We're six weeks into 2020 and Brexit has happened. So now what do Jersey Financial Services and it's clients need to consider? It's time to look ahead to the rest of 2020 (and beyond) and consider what changes are on the horizon. However, whether anyone can truly do so with the clarity of 20/20 vision is questionable. What we do know is that the world in which our clients and we operate in continues to be one of uncertainty.
Perhaps, firstly, we can say that 2020 will continue to be a period of both challenge and opportunity, given the background of Brexit and a changing world geo-politically. However, against such a climate, Jersey continues to be a rock of stability. A safe harbour for clients and businesses seeking to safeguard their assets whilst operating out of a reputable and well-regulated jurisdiction.
A new Registry Law will be introduced during the latter part of 2020. While the rationale for the change is to provide Jersey with a registry law fit for today's world, significant changes will include the introduction of a public Register of Directors from 1st January 2021. The full details of the information that will be publicly available are yet to be confirmed. It is unlikely that the requirements will be any more or less than those of other jurisdictions such as the UK. The law will also see the introduction of an "agent" which will allow firms such as Fiduchi to be able to assist our clients better.
We will be communicating with our clients more fully on the requirements and potential impact if any, as the detail is published.
Jersey is introducing Mandatory Disclosure Rules which are in line with the OECD model. This is to meet the commitment given to the EU Code of Conduct Group (Business Taxation) in December 2018. The rules will oblige providers such as Fiduchi to report on CRS avoidance and opaque offshore structures. These are anti-avoidance measures and designed to provide information to a relevant jurisdiction upon which they may act against the report subject.
The first reporting under the economic substance rules introduced in 2019 will be made in 2020. Fiduchi continues to work with our clients that undertake relevant activity to meet the requirements of the legislation to ensure ongoing economic substance compliance. We are, of course, able to assist new clients in this regard.
A new funding model has been introduced by the Office of the Information Commissioner in Jersey. This will see an additional fixed fee of £50 for all Jersey registered corporate vehicles in Jersey where service providers such as Fiduchi are appointed.
Beyond 2020, clients also need to be aware that there will be a transitioning of interbank offered rates to alternative reference rates. This follows the financial crisis, which has seen the demise of interbank offer rates which will be replaced by the end of 2021. This means that existing funding or financing facilities should be reviewed and updated for alternative reference rates. Reviewing existing agreements now is essential, as agreements may need to be amended to account for the transition to an alternative reference rate and systems. Calculation models may also require an update, particularly where the rates are imbedded into technology platforms. Fiduchi is already working with its clients on this and can assist you.
The above summarises some of the more specific changes that are coming. The broader uncertainty that remains still presents opportunities. Jersey is well placed as a well-regulated jurisdiction to assist you in pursuit of these opportunities, and Fiduchi is there to assist its clients and you in that.
The Government of Jersey has a long-standing commitment to Jersey being a well-regulated international finance centre, which complies with international standards in transparency. Such an approach can confuse clients as to the applicability of EU legislation to Jersey.
As future information requirements are identified, so we will look to engage with clients and their advisors as much as we are able, or legislation and regulations allow.
Protecting clients and their rights have been the focus of regulators across a range of industries for many years. None more so than in the financial services industry. The financial crisis brought to the fore the importance of how firms in the financial services industry manage clients and their assets.
Fiduchi’s foundations are built on those of the chartered accountancy profession, which is itself built upon the foundations of integrity and professionalism. Fiduchi has embedded at its heart integrity and how clients’ interests should be met. Therefore, Fiduchi is more than well placed to continue being able to meet the requirements of regulation as it evolves and more importantly to ensure that the interests of clients continue to be met well into the future.