bl magazine issue 45 july/august 2016

ISSUE 45 JULY/AUGUST 2016

BL MAGA

ZINE ISSUE 4

5 JULY/AUGUST 2016

the channel islands react to brexitWhat now?

2 july/august 2015 www.blglobal.co.uk

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Welcome

we clearly live in a very different world now

As much as nature and politics abhor a vacuum, business abhors uncertainty. If

there’s only one thing we can be sure of in the aftermath of the Brexit vote, it’s that we’re now in what is likely to be the most uncertain and unstable period we’ve endured in the past 70 years. Quite what the end result will be for the UK, the Channel Islands, the EU and, indeed, anyone who does business with us is far from clear, and is unlikely to be clear for some time.

As I write this, a matter of days after the UK voted to leave the EU, we have already seen sterling tank, trillions wiped off company valuations, resignations at the highest levels of UK politics, and the possibility of a Scottish ‘veto’.

By the time you read this, who knows what the state of play may be. It’s likely, however, that the UK may not have even started its exit from the EU. David Cameron has said that it will be the responsibility of the incoming (unelected) Prime Minister to trigger Article 50, signifying the start of the process.

It’s impossible for me to write dispassionately about the result of the referendum. It has always been editorial policy at BL to remain as politically (and constitutionally) neutral as possible and to let the commentators in our articles present the arguments. However, with the wounds of the result still fresh, I simply can’t comprehend the fact that the majority of the British public were willing to go against the overwhelming expert opinion that leaving the EU was not only too big a risk to take, but that it would irrevocably damage the country’s economy and its future on the global stage.

I completely understand that a large number of people in the UK have lost faith with politicians and feel massively disenfranchised. What we heard time and again, as the votes came in on the morning of Friday 24 June, was that a large number of people were using the referendum as a protest vote – to ‘kick the establishment’ and stick it to the ‘elites’.

It is bitterly ironic, then, that those people may find themselves with a new Prime Minister in the form of Alexander Boris de Pfeffel Johnson – the Eton- and Oxford-educated former MP for Henley and current MP for Uxbridge and South Ruislip.

EMOTIONAL AND ECONOMIC TURMOILIn the run-up to the referendum, the UK witnessed one of the most acrimonious political ‘debates’ in living memory. It’s not that there wasn’t serious and eloquent commentary, it’s just that so many people stopped listening to it when all they could hear were two sides screaming at each other in a political equivalent of The Jeremy Kyle Show.

Where do we go from here?

Since the result, emotions seem to be running even higher. Those who voted Remain have taken to the internet and social media to decry the outcome. A petition for a second referendum has garnered millions of signatures, and there is anger that some of the key arguments for Leave – most notably that the £350 million paid to the EU would be redirected to the NHS – have proved false. Causing even greater anger and concern is that the Leave campaigners don’t actually have a demonstrable plan for moving forward.

Here at BL, as the referendum approached, we were faced with an unusual challenge. With a deadline that originally fell on the same day as the vote, we had to devise two separate covers – one that reflected Brexit and one that didn’t. While the cover of this issue – a brilliant illustration by Marthinus Slabber – is powerful and eye-catching, it’s one we hoped we’d never have to use. But here we are.

As the UK prepares for a torrid time in the years to come, the Channel Islands also face some considerable uncertainty. While not part of the EU, Jersey and Guernsey are – as Crown Dependencies and through ties with the City of London – inextricably linked with the mainland.

The governments of both islands, along with Jersey Finance and Guernsey Finance, moved quickly to reassure the public and business that, while there were challenges ahead, they believed the islands would deal with them as robustly and with as little disruption as possible. Whether that optimism is warranted, only time will tell.

We clearly live in a very different world now.

Nick Kirby, Editor-in-Chief, BL magazineThis editorial was written on Monday 27 June.al

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Contents

INSIDE

DR LIZ ALEXANDERIt’s a noisy old world out there, and in order to get

heard you need to let everyone know how

knowledgeable you are. But in a world full of

experts, how can you make yourself ‘visible’?

Liz explains all.

JACK FLANAGANTech geek and financial writer Jack gets the best of both worlds and looks

at why there will never be an Uber of banking. That said, he discovers the banks need to be on top of change in a whole host of areas.

KIRSTEN MORELMaking sense of the Panama Papers was always going to be

something of a major challenge, so who better to take on the task than

BL stalwart Kirsten. And a stellar job he

makes of it too!

DAVE WALLERBL regular Dave goes all European in this issue

before taking to the high seas. First up, he looks at the AIFMD passport, then

it’s on to EU rules for data protection, before

hopping on board a luxury cruise. Lucky boy!

contributors

7 BREXIT: reactionsA round-up of how Channel Island organisations reacted to the result of the UK referendum on Europe

12 AppointmentsRecent key hires for Channel Island firms

16 InterviewSteve Falla, head honcho at Orchard PR, on social media, transparency and two-way communication

Finance20 the insider viewAfrica, the Far East, the US and the Middle East are scrutinised by our experts

24 PANAMA PAPERSJust months on from the Mossack Fonseca leak, what have we really learned?

30 no uber of bankingIf you’re hoping that an upstart startup will come along and disrupt the banking world, you might have a long wait

37 eu passportingJersey and Guernsey may have received AIFMD ‘passport’ approval, but when might it come into effect?

40 INVESTINGIt’s bad enough that markets are all over the place, but investors also have to contend with fund managers charging when they underperform

opinion44 Beware the PC crowdDexter Flynn from Voisin law lays into political correctness and has a swipe at Jersey’s new discrimination law

business46 expertiseWith everyone claiming to be an expert, what is it that makes the real experts stand out?

50 managementTen signs that an employee is ready to step up to management

52 business digestA quick collection of titillating business trivia

technology54 data protectionChanges to European data laws look set to put the individual in control at last

LIFESTYLE64 CRUISINGAll aboard the high-end cruises that offer style and exclusivity for those with a bit of cash

58 bl guernseyNews highlights, plus changes to employment and population law

62 bl JerseyA review of the biggest business developments and finance news stories

30

The AgendaOur lifestyle section heads down to Rio to soak up the sun, spirit and Olympic excitement!

69

24

© Chameleon Group Limited, all rights reserved. Reproduction in whole or in part without written permission is prohibited. Views expressed by our contributors are their own and do not necessarily represent the views or policies of Chameleon Group. While every effort is made to achieve total accuracy, Chameleon Group cannot be held responsible for any errors or omissions.

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CEO, CHAMELEON GROUPCarl Methven

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EDITOR-IN-CHIEFNick Kirby

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ART DIRECTORAngela Lyons

SUB EDITORKate Wheal

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NEWS AND [email protected]

GENERAL [email protected]

BLMAGAZINE

Cover illustration Marthinus Slabber

Brexit


THE RESULT OF the UK referendum on the EU has sent shockwaves around the globe. As politicians across Europe scramble to make sense of what happened and attempt to predict (and mitigate) the fallout, the Channel Islands are also facing up to how the vote may affect their relationship with both the UK and the continent.

Even as we started to compile this collection of statements and comment from government, organisations and firms in the Channel Islands, things were changing rapidly. By the time you read this, there will certainly have been further developments and additional commentary.

So, with the heavy caveat that the situation could be considerably different at the moment of reading, here’s how Jersey and Guernsey reacted in the immediate aftermath of the vote.

GOVERNMENT REACTIONThe States of Guernsey and States of Jersey moved quickly to issue reassuring statements that they were well placed to weather any changes that might happen, highlighting the nature of their relationships with the UK and the EU.

The States of Guernsey press release noted: ‘The UK decision to leave the EU should not directly impact Guernsey’s historic relationship with the UK, which predates its relationship with

the EU. Guernsey is not a member of the EU and not part of the UK. Under its Protocol 3 relationship with the EU, Guernsey is part of the customs territory which allows for the free movement of goods. For most purposes, the islands are treated as third countries and outside of the EU. Guernsey has negotiated market access, or equivalence, with the EU in a number of areas, including the trade in services. Guernsey’s long-standing policy has been that it is not seeking to change its formal relationship with the EU. Guernsey was a third country to the EU before the vote, it remains a third country to the EU now, and, it will remain a third country and outside the EU when the UK eventually leaves the Union.

‘However, Guernsey’s Protocol 3 relationship, shared with the other Channel Islands and the Isle of Man, will fall away when the UK leaves the EU and will need to be replaced by new trade in goods arrangements.’

how the Channel Islands reacted

Brexit:

Gavin St Pier Ian Gorst

Words: Nick Kirby

Immediately after the result of the UK referendum, organisations and firms in Guernsey and Jersey rushed to issue statements on how the islands might be affected. Here we bring you some of the key opinions


Brexit

▼

have always demonstrated real tenacity in the face of change, whilst Jersey’s government is on the front foot in representing its interests to the UK and Europe, which will continue to be major partners for Jersey. This should all give confidence to investors.”

Jersey Finance is running a section on its website (www.jerseyfinance.je) entitled Spotlight on Brexit – this will be updated as the situation evolves.

Dominic Wheatley, Chief Executive of Guernsey Finance, was equally rigorous in his view on how Guernsey might be affected. He commented: “Although the [vote] is clear, we have yet to see how it will be implemented and the new world that will be formed in this process. We will be monitoring developments closely to assess the impact of this on Guernsey and the financial markets in which we operate.

“What is clear is that Guernsey is robust, innovative and responsive to its markets and the international business environment… Guernsey will remain committed to its position at the forefront of global standards of regulation, tax co-operation and transparency, and AML.

“This position, alongside the substance and expertise of our finance industries, and the commitment and professionalism of the Guernsey Financial Services Commission and our government, makes us very confident that we can adapt and succeed in this new world as it evolves.”

Echoing many of the above sentiments, Fiona Le Poidevin, CEO of the Channel Islands Securities Exchange (CISE), said: “Guernsey and Jersey are both in a strong fiscal position and have diverse financial services industries, which will help the islands weather any storm. Indeed, as the local economies adjust to the prospect of a UK outside of the EU, it is a time to look for opportunities so that we can continue to prosper in the future.

“London will remain a major financial centre, and it is our largest business introducer centre. However, the islands

Deputy Gavin St Pier, President, Policy and Resources Committee at the States of Guernsey, said: “Nothing will change overnight in the relationships that Guernsey has with the EU, or the UK for that matter. We will be monitoring the economic impact of this significant constitutional change for the UK and we will be engaging with business, with the Committee for Economic Development, to understand this knock-on effect to our economy.”

Shortly after the statement was issued, the Policy and Resources Committee lodged a Policy Letter with the States Greffe about managing the implications for Guernsey. The latest position on all matters relating to the referendum can be found at www.gov.gg.

For the States of Jersey, Chief Minister Senator Ian Gorst commented: “Jersey ministers and officials have worked hard to ensure that the UK government understands Jersey’s interests and will take them into account in its future negotiations with the EU. We have been clear that, whatever the result of those negotiations, the government of Jersey believes that the island’s best interests lie in maintaining the substance of our current relationships with the EU, as set out in Protocol 3, and with the United Kingdom.

“The Council of Ministers have met to discuss what [the] announcement means for Jersey, and to reach an agreement on the work that we will now undertake.

“Finally, I would like to take this opportunity to say to those currently living and working in Jersey, who are nationals of EU member states or of countries further afield, that we are determined to preserve their contribution to the island community, which is both welcome and greatly valued.”

On Monday 27 June, the States of Jersey issued a Brexit Information Report, detailing what the UK’s exit means for Jersey and how it will protect the island’s interests. This is available at www.gov.je.

THE FINANCE INDUSTRYAs the largest employer and contributor to GDP in both islands, the finance industries in Jersey and Guernsey were likewise quick to respond to the result of the referendum.

Geoff Cook, CEO of Jersey Finance, said: “Jersey’s constitutional relationship with the UK will not be affected by the UK’s decision to leave the EU, and we remain convinced that the UK’s long-term position as a financial services powerhouse will continue. In addition, Jersey is already outside of the EU itself and maintains strong access to European markets through its broad and robust third-country agreements. These also remain unaffected.

“Meanwhile, given the increasingly global outlook of Jersey’s finance industry, spanning Asia, the Middle East and Africa as well as Europe, it is in a strong position.

“Jersey’s financial services businesses

Geoff Cook Fiona Le Poidevin

Dominic Wheatley Ben Robins


Brexit

are also becoming increasingly diverse in terms of exporting their financial services globally and I expect this trend to continue.

“In addition, in terms of EU market access for financial services, we remain third countries and, as such, we will continue to negotiate directly with the EU through the Channel Islands Brussels Office (CIBO).

“At the Exchange, a significant proportion of our business relates to the investment funds industry and we have seen before that, in times of turmoil, the sector remains robust due to the diversification into different alternative asset classes, including private equity. We have seen a strong start to the year despite the uncertainty that the referendum created and so, once confidence returns, we expect to see ‘business as usual’ and we will continue to monitor developments in the UK in the coming weeks and months.”

On the specific matter of the funds industry, Ben Robins, Chairman of the Jersey Funds Association (JFA), said: “Jersey’s funds industry is increasingly globalised but retains particularly strong connections to the City of London and, to a lesser extent, financial centres in the rest of the EU. The political and market uncertainty and volatility that inevitably follows a Brexit vote will have a significant impact on the global asset management industry, and particularly the UK and EU industry, and is therefore likely to have an impact, in the short term at least, on the transaction flows we experience in Jersey.

“In some areas of investment, transaction activity may be curtailed for a time but in others, currency and asset pricing movements may actually encourage trading activity. Jersey will feel those short-term market movements, both negative and positive.

“The JFA strongly endorses the Chief Minister’s statement that the island’s future best interests lie in maintaining the substance of our current relationships with the EU, so we can continue to enjoy the EU market access for financial services our funds industry already enjoys.

“But it is also a sensible time to re-emphasise the continuing importance of Jersey investing in stronger links with dynamic non-EU markets as a global player in the asset management industry.

“We succeed as a funds centre largely because of the quality of our people, just as the City of London does, and I fully expect Jersey and the City to thrive through and beyond this period of uncertainty.”

The Jersey Financial Services Commission (JFSC) commented: ‘The position in the immediate aftermath of the referendum result in both the UK and the EU is somewhat fluid and uncertain and the Jersey Government has prepared for and is leading the jurisdictional response.

‘The statutory responsibilities of the

JFSC remain the stability of the island’s regulated financial services community at individual, sectoral and systemic level, acting in the best economic and reputational interests of the island.

‘A major external event such as Brexit may have both short- and longer-term consequences for the island’s financial services industry, to the extent that it is impacted by external political and financial market developments.

‘The Governor of the Bank of England, Mark Carney, has already said that it has substantial contingency plans in the event

of a proposed UK exit from the EU to achieve continuing market stability and confidence in those markets that are of importance to Jersey, and we are significantly dependent on a successful outcome for these plans being delivered by the Bank.

‘However, in addition, the JFSC will seek to monitor carefully any material local developments within individual licensed firms in Jersey in terms of financial strength, conduct of business and business strategy that may occur as a result of the Brexit decision. This may be particularly relevant when Jersey-based firms operate as subsidiaries, branches or affiliates of UK or EU parents.

‘In general, we do not see the likelihood of significant changes in the short term, nor see the period of market volatility we are currently entering as threatening the financial stability of Jersey firms.’

THE BUSINESS VIEWThe Jersey Chamber of Commerce addressed the potential implications of the two-year withdrawal period once Article 50 is triggered. In a statement, it said: ‘There’s no doubt businesses in Jersey have already been affected by the period of uncertainty caused by the referendum. Chamber members locally reported a cautious trading environment, with decisions and deals delayed until after the [vote]. Now the UK has voted to leave the European Union, Jersey must prepare itself for a further period of uncertainty.

‘[After Article 50 is triggered], the UK will enter a period of withdrawal from the EU – negotiating new trade deals, access to EU markets, migration policies and the movement of its citizens within the EU zone. Whilst Jersey remains a Crown Dependency, it is unclear how the Channel Islands will feature in the UK’s negotiations with the remaining 27 EU member states. It is fair to say there are already concerns that Jersey could find itself at the back of the negotiation queues.’

President of the Jersey Chamber of Commerce Kristina Le Feuvre said: “The immediate impact on Jersey’s business community is difficult to predict. Jersey is outside the EU for most purposes, and the direct impact on Jersey would

it is unclear how the Channel Islands will feature in the UK’s negotiations with the remaining 27 EU member states

▼Kristina Le Feuvre

Linda Johnson

Chris Clark

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provide legal, tax or investment advice and the information in this document should not be regarded as such.

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Brexit

therefore be expected to be limited. Jersey’s free trade in goods and services with the UK (where most of our exports are directed) would remain unaffected. Whilst it is in theory possible that free trade in goods with the EU member states could disappear at the end of the two-year withdrawal period, in practice we would expect a new arrangement to have been put in place.

“It is imperative the island’s business community is kept well informed. Chamber members and islanders need to know our Chief Minister and his team are negotiating the very best deal possible with the UK, EU and global politicians. Ensuring the island’s interests are a priority and Jersey’s economy remains buoyant.”

Linda Johnson, Chair of the Guernsey branch of the Institute of Directors said: “The Brexit result represents an opportunity for the States of Guernsey to negotiate the best possible position for the island in relation to its national, international and global counterparts. The outcome of these negotiations will be significant for business.

“The Policy and Resources Committee has stated its four priorities in the event of this outcome and the IoD supports this approach. There is considerable depth of knowledge and expertise within the IoD membership and we would welcome the opportunity to consult with and support the Policy and Resources Committee in its endeavours to achieve the best outcome for the island, its people and its business community.”

Johnson’s counterpart, Chris Clark, Chair of IoD Jersey, said: “Whilst we are aware that this is not what the majority of our members expected or wanted as an outcome, it is imperative that we now look forward to ensure that Jersey businesses can continue to thrive.

“What is clear is that Jersey is still very much open for business. Our geopolitical stability as an international business centre will continue, acting as a safe, trusted and secure conduit for business to international markets via our existing well-regulated industries and agreements. In fact, it is possible that the UK’s exit from the EU could act as an opportunity to support international businesses that are concerned with the instability that will no doubt be experienced in the UK and across Europe over the coming months.

“To that end, bodies such as Jersey Finance and Locate Jersey will be vital in facilitating inward investment enquiries over the coming months and should get the political and economic support they need, whilst we would also encourage a flexible approach to licensing should significant organisations be considering relocating their businesses to the island.

“We are fortunate in Jersey to have a broad range of innovative businesses

trading locally and internationally, and they have proven time and again to be adaptable in times of change and will no doubt prove sufficiently resilient to weather this storm.”

THE LEGAL PERSPECTIVERobert Christensen, Managing Director at Volaw, reflecting on the result of the UK’s referendum and how the decision is likely to affect Jersey, raised concerns that other countries would seek to carry out their own referenda, which could pull Europe apart. Similarly, he highlighted the real difficulties faced in actually negotiating the UK’s exit, as well as the possibility of Scotland fighting to stay in the EU.

“All of these issues indicate a prolonged period of uncertainty for the UK, and challenges over the next 24 months. How will this impact upon Jersey, which interestingly (being outside the UK) played no part in the referendum? Again, it is too early to be certain, but it would be a fair bet that Jersey’s government will be seeking urgent talks with the UK government and the EU Commission to seek to preserve to the fullest extent possible the arrangements that are currently in place regarding:● The free movement of goods with the UK and EU member states;● The Common Travel Area that allows free movement of people between Jersey and all other parts of the British Isles

and the Republic of Ireland;● The island’s self-government status, including fiscal autonomy;● Jersey’s ‘third country’ equivalence rules and treatment, which allows access to EU markets for financial services;● Similar ‘third country’ status for trade in other services.”

OTHER SECTORSIn its Brexit Information Report, the States of Jersey made the following observations about other sectors in the island:● Tourism There is unlikely to be much, if any, negative impact on the tourism industry as the conditions that allow for tourism from the EU to Jersey – such as island air and shipping operators continuing to meet relevant EU standards – should remain in place.● Agriculture The vast majority of agricultural produce exported from the island is destined for the UK. On the reasonable assumption that the UK market will remain open for Jersey produce, the agricultural industry would be relatively unaffected if the UK’s withdrawal from the EU made exporting to the EU more difficult or costly. Recent growth in exports has been predominantly to countries outside the EU, so this business would also be largely unaffected. ● Fisheries The majority of fisheries produce exported from the island is sold in France and, in the event of a Brexit, may be subject to tariffs, unless or until a new arrangement with the EU is put in place.● Goods Exports of manufactured goods from the island are small in number. As regards imports of goods into the Channel Islands (including food, textiles, building materials and fuel), almost all come via the UK. The loss of Protocol 3 will therefore have minimal direct effect on Jersey in terms of imports, since we will have free trade in goods with the UK.● Digital services The continued development of the digital economy will reflect the position of financial services, in that many of the global attractions of Jersey as an international finance centre apply equally to other services. n

A more comprehensive reaction to Brexit from the commentators featured in this article can be found on the BL website, www.blglobal.co.uk

Guernsey and Jersey are in a strong fiscal position, which will help the islands weather any storm

Robert Christensen


Brexit

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12 JULY/AUGUST 2016

Appointments

Robert Luetkehaus has been promoted to Manager of the fund services team at

Moore Stephens. He will develop the firm’s fund offering in Jersey, and oversee

relationships with property managers, lawyers and auditors, as well as the structuring of funds and investment

vehicles. Robert joined Moore Stephens Fund Administration after relocating to

Jersey in 2011, starting as a Fund Administrator. Before joining Moore

Stephens, he spent a year in a consultancy role with Air France and three

years as a Director at Singapore-based financial services firm Portelet Asia.

First Names Group has appointed Teresa Lamy as its Chief HR Officer.

Based in the Group’s head office in Jersey, Teresa will oversee its group-wide HR department. She will also sit on the

Group’s Management and Operations committees. Teresa joins First Names

from professional services provider TMF Group, where as Global Head of HR she

was responsible for more than 120 offices in 80-plus countries. Prior to this she was with Equity Trust, where she developed and delivered an HR framework for the

management and development of the organisation.

Channel Islands airline Aurigny has announced two senior appointments

– Andrew Haining (pictured) as its new Chair and Meriel Lenfestey as Non-Executive Director. Andrew has

spent his career in private equity after working initially for Bank of America. He

takes over the role of Chair from Jon Moulton, who has led the Aurigny board for the past four years. Meriel worked for Microsoft and the BBC before setting up

her own digital design consultancy. She also serves as a Non-Executive Director of, among others, JT and

Startup Guernsey.

Airtel-Vodafone’s Head of Operations, Sid Ahlawat, has been promoted to Chief Executive Officer. He has taken over from

Ian Campbell, who left the company in May. Sid, who has 20 years’ experience in

customer service delivery and sales, joined Airtel-Vodafone in March 2006 and

played a key role in launching the company in the Channel Islands in 2007.

He previously worked for Bharti Airtel Group. He said: “Since launching in the

Channel Islands, the company has invested over £40 million in infrastructure.

I’m looking forward to helping drive innovation for mobile customers.”

Anna Guggenheim QC has been promoted to Partner within Babbé. An Advocate in the firm’s dispute resolute

team, Anna has been with Babbé since 2014. She was appointed Queen’s Counsel in England in 2001 and is the only Advocate in Guernsey to hold that status. She

has practised for more than 20 years in London, undertaking a wide variety of commercial litigation. Her

experience includes international arbitration and mediation, both as counsel and as arbitrator/mediator.

In 2006 she was appointed as Circuit Judge and tried civil and criminal cases in London for eight years before

moving to Guernsey.

JULY/AUGUST 2016 13

News

Ipes Group has named Jim Faulds as its new Chairman. Jim is an experienced

Non-Executive Director and Chairman. He spent his executive career in advertising, founding Faulds Advertising. Since then,

he has served as Chairman and Non-Executive Director on the boards of listed

and private equity-backed companies, including Wood Mackenzie and Giles

Insurance Brokers. He currently chairs Change Recruitment and Jumpstart. Jim

succeeds Pernille Fabricius, who has chaired Ipes since it was acquired in 2013 by Silverfleet Capital. She has moved on as CFO of Swedish firm Getinge Group.

Estera, formerly Appleby Fiduciary Business, has appointed Roger Siddle

as Non-Executive Chairman. Roger currently serves as Non-Executive

Chairman of consulting and software business Cordium, and ia also a Senior Corporate Adviser and Member of the National Development Board for the NSPCC. He has, in the past, been UK

Managing Partner of business consultancy Bain & Company, Chief Executive of

training company BPP Holdings and, more recently, Group Chief Executive of

home shopping, educational and healthcare business Findel.

Sean Bougourd has joined the board of SPF Private Clients as its Chief Operating Officer. Sean has 30 years’ experience in

the industry, focusing on traditional private client investment advice. He

joined SPF in March 2015 as Associate Director, developing the wealth

management and private office activities of the business and working with clients

to identify and implement tailored wealth management solutions. He also chairs

SPF’s Investment Committee. Before joining SPF, Sean spent 25 years with SG Hambros, latterly leading the

Guernsey Private Banking team.

EY Partner Wendy Martin has extended her role in the Channel Islands. Having been promoted to Tax Partner last July,

she is taking over as Head of Tax, replacing Peter Willey, who has returned to EY in the UK. A specialist in domestic

and international tax matters, Wendy has an in-depth knowledge of the automatic

exchange of information regimes. She advises banks, fund managers, trust

companies and administrators on how to address compliance challenges. Prior to

joining EY, Wendy was Director of Tax Policy with the States of Jersey,

developing tax policy for the island.

Telecoms group JT has appointed Thierry Berthouloux as Chief Technology and Information Officer, based in

Jersey. Thierry has 25 years’ experience in the European telecoms industry, most recently as Chief Technical Officer

for Monaco Telecom. In this role, he led domestic and international operations, before enlarging his scope to

include IT and creating a converged network and IT division in 2013. At JT he will oversee complex projects for European telecoms companies, including French operator

SFR. He replaces former Chief Technical Officer Dave Newbold, who is moving to a similar role with

broadband provider Gigaclear in the UK.

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GETTING HEARD ABOVE THE NOISE

Steve Falla

The

interviewWith more than 27 years in the PR industry, Steve Falla, Managing Director at Orchard PR in Guernsey, has seen

major changes in the Channel Islands, not least in the way organisations communicate with the wider world


Interview

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Words: Nick KirbyPictures: Chris George

Give us your personal career history in 60 seconds.I was a journalist for 10 years – straight out of school in Guernsey. I worked on the Guernsey Press and then the Oxford Mail before returning to the Guernsey Press.

I wasn’t entirely sure how I wanted to move on from there, but Wallace Barnaby, a full-service agency, was setting up the first professional PR firm in the island and I had the opportunity to join them as number two in the organisation. I worked there for seven years, running White Knight PR. I started Orchard in 1996 – we now have a team of 14 and work with a broad portfolio of clients across financial and professional services, consumer, utilities and the private and public sectors.

Orchard’s been going for 20 years – how has the PR industry changed during that time?Professional PR came to the Channel Islands relatively late in the 80s. When White Knight started, the demand was largely for an outsourced press office function. It’s now become much more about strategic communication.

I think the word ‘strategic’ is overused, but there’s definitely an element of strategy about what we do – and by that I don’t mean ‘spin’. The advent of digital means organisations now communicate across multiple platforms.

PR used to be about getting clients into the news media, now it’s more about what the client says in the media. We used to push messages out, but 21st century comms is more about having a conversation.

Have social media and the internet made managing PR a lot harder?I don’t think it’s made it harder, but it’s made it relentless – and there’s a sense that we’re ‘always on’. We no longer have the restricted news cycle around mainstream media deadlines. In one respect social media has made it easier, because organisations can talk directly to their stakeholders – they’ve had to become more transparent, more accountable and more accessible. In fact, we have one client that no longer uses the mainstream news media to communicate proactively; they use ‘owned media’ – their own media channels – to communicate with stakeholders.

Some professional business clients are nervous of using social media because of what happens when something goes wrong. I tell them that’s often the best opportunity they can have because the way you respond really shows the strength of character and culture of the organisation.

Yes, people can get it wrong – the social media function might have been delegated or you have the peril of the ‘late night tweet’. However, there’s no escaping the fact that social media is now absolutely an integral part of modern PR. In fact, it probably accounts for 50 per cent.

There’s that age-old phrase ‘there’s no such thing as bad PR’ – would you say the likes of Mossack Fonseca and, on a more local level, Condor Ferries have put that to bed?That adage is really about publicity, and that’s something else altogether. The notion assumes you have to do PR, but in reality people form a perception of an organisation as a result of what it says, what it does and what other people say about it. So PR exists whether one chooses to actively manage it or not.

This is where crisis or issues management becomes interesting – this is something we get involved in a lot. Unsophisticated communicators don’t always recognise that the very time they need to communicate more is when things are going wrong. When there’s an information vacuum, commentators and ‘opinion formers’ fill the void. It’s important you set out your stall properly when things go wrong.

So what constitutes ‘good PR’?It most definitely has to be ethical. And that means, particularly with digital, what we call ‘two-way symmetrical communications’ – listening as well as telling. We no longer push messages onto the audiences from whom we want to provoke a response. Social media’s created a new way of holding conversations with stakeholders and influencers and we can do that not just by starting new dialogues but by responding to the issues and challenges that arise. A phrase I love is ‘changing behaviour before unleashing words’. It’s about authenticity: organisations not just saying what they do, but doing what they say they do. The whole ethics piece is relatively newly embraced in communications, and a world away from spin, but people aren’t stupid and when an organisation behaves and communicates authentically they become a trusted organisation.

Do you think PR has a bad reputation, because of ‘spin’ and the way the industry is portrayed on TV?I think it’s part of life – and we’re not alone in that. Many professions have

been parodied on TV and in other ways. Take Ab Fab, which I find really funny – I don’t think most people judge PR based on having watched an episode or because someone’s poked fun at the profession.

I do think there’s often a slightly strained relationship between PRs and journalists, and that journalists, with their naturally cynical, inquiring minds, will believe PR is presented in a certain way. I hate the word ‘spin’, but PRs have to work openly, honestly and transparently or you come undone. You have to work hard to build relationships – it’s a relationship business, be it with clients, the media or politicians.

In the current economic climate, how is PR being affected – are you having to do more for less?PR is a time-consuming activity so there’s a limit to where you can pare down the amount of time that’s needed. Without a doubt we’re having to do more for less but I don’t think we’re alone in that. In the islands, businesses are taking comms more seriously, so what they also need to do is have the will to invest in it. It requires a budget, and professional comms works best when we’ve got that level of commitment at board level.

How difficult is it to attract talent into the profession? It’s important to distinguish between the Channel Islands and the UK. PR is an attractive career option for many people of a certain skill set – there are people who are instinctively brilliant at it, and I’ve been lucky enough to have some of those work for me. If we were based in the West End, we’d be spoilt for choice when hiring. In the islands it’s more limited because of the barriers to living and working here.

We’ve spent a lot of time developing a training culture at Orchard, which now includes an apprenticeship. We also put all of our graduate joiners through

there’s no escaping the fact that social media is now absolutely an integral part of modern PR


Interview

professional qualifications with the CIPR. As a result, we’ve grown people from the bottom rung of the ladder to Account Director on more than one occasion.

I see Orchard as having been something of a communications ‘academy’ – many former Orchard people are now working in-house in the islands, in consultancy in the UK or further afield, and some have even become clients.

As far as attracting talent goes, we’re looking for raw material that we can hone. Retaining the talent is really hard work. It’s not the best-paid work in the world, so you have to love it and be prepared to put in the time in order to progress.

You look after clients in all the Crown Dependencies, but only have a physical presence in Guernsey. Why is that?Guernsey’s where it all started, although very quickly we were working in Jersey. Where there previously may have been a need to open satellite offices, the digital revolution has changed that. Clients are comfortable with the communications function not being right on their doorstep.

We’ve worked for clients in the UK, Jersey and Isle of Man, and, from their perspective, what we can deliver is no different than if we were sitting a few hundred yards down the road.

Sometimes there’s the need for face-to-face meetings, and Orchard people do spend quite a lot of time in the air, but we’ve made a conscious decision to keep the team together as a cohesive unit.

How challenging has PR in financial services been in the past decade – and most recently with the Panama Papers?You never know what’s going to happen when you sit down at the start of the day, and financial services is one of those industries where the bombshell can drop.

I’ve experienced a lifetime of threats and challenges to international finance centres since I started in PR, and Panama is an interesting example – it’s presented a positive opportunity for the islands to restate their reputation and standards.

I’ve spent time with Guernsey Finance talking to columnists on the broadsheets in London off the back of Panama, and it’s opened doors that might not have been accessible. While no one would have wished for Panama and some of the issues it has raised, it’s actually been a good thing for the islands from a PR standpoint.

Do you think some firms simply don’t ‘get’ PR and how to manage reputation?The biggest issue isn’t necessarily firms getting it wrong, because most of them either have in-house or external support and senior people do tend to be strong communicators. The flaw is that many professional firms aren’t prepared to take the risk in communication – they’d rather not have it at all than risk it going wrong or being misinterpreted or misquoted.

This is something that’s an ongoing challenge for us because we’ll be called in

by a potential client who’s very nervous about speaking to the media or putting their head above the parapet. Yet because others are doing it, and because they want to grow their business and better educate their market about what they offer, they feel they need to do it. I think the firms that are behind the curve are missing out.

How do you feel the Channel Islands in general manage their PR?It’s a bit of a curate’s egg. Sometimes they are very good, especially when it comes to reactive activity when they’re responding to the UK government, for example. I’ve seen both islands doing a very good job recently. Take Guernsey’s open letter to David Cameron explaining why we couldn’t sign up to transparency because we didn’t have a government, as we were in the middle of our election. That was done well. But sometimes there’s a lack of cohesion across departments in the islands – the private and public sectors could work more closely together to get unified messages across.

Is PR going to become even more important as firms in all sectors battle it out in a noisy and crowded marketplace?Clearly I’m bound to say yes, because I think the importance of good communication isn’t going to go away and will be taken more seriously. Good PR is the opposite of noise – it enables organisations to stand out in the market with a clear, concise and authentic message. But it will continue to be two-way – we’re not going back from that – and that means organisations listening to stakeholders and taking action. And that might mean changing and adapting to what the market needs them to be. n

NICK KIRBY is Editor-in-Chief of BL magazine

FACT FILE

Name: Steve FallaAge: 55Position: Managing Director, Orchard PRMarried to: LoisChildren: Two teenagers – Elliot and HarveyHobbies: Music, theatre, guitar and bass guitar, and running half marathonsInteresting fact: I played Sweeney Todd in the Stephen Sondheim musical

Panama has presented an opportunity for the islands to restate their reputation


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20 july/august 2016

The Insider View

As the Channel Islands continue to attract business from around the world, BL asks leading figures in Jersey and Guernsey for their expert view on the challenges and opportunities in a number of global regions

LINDSAY BATEMAN, BUSINESS DEVELOPMENT DIRECTOR, BROOKS MACDONALD Economic uncertainty and regulatory requirements for foreign service providers pose challenges for Channel Islands-based firms marketing the benefits of offshore investment in Africa. However, there are significant opportunities for firms that are committed to structuring their businesses to support local requirements.

President Zuma’s decision to remove two South African finance ministers in just four days last year was a stark reminder of the political instability and economic uncertainty that remains in parts of Africa – even South Africa, which has historically been regarded relatively highly on the international stage.

As one of the most sophisticated financial services markets in the region, South Africa is an interesting case in point. The country is at an inflection point, balanced between implementing business- friendly policies – to support renewed economic growth – and a slippery slide to junk status, just as we saw with Brazil last year. This economic ambiguity, coupled with the fact that South Africa contributes less than one per cent to global GDP, provides a strong argument for residents

to diversify offshore. Yet the weakening of the domestic currency has made offshore investment relatively expensive, and complex tax and exchange controls mean investors looking to externalise assets must be selective over the firms they work with.

Economic and political difficulties pervade other parts of Africa. Nigeria remains a significant African economy, but is struggling through its lack of real diversification away from oil production, with allegations of corruption at their highest levels. Elsewhere, Zimbabwe, previously the breadbasket of southern Africa, is battling a prolonged economic crisis that’s led to job losses, closures

and declining consumer spending. The number of residents seeking to protect their remaining wealth through international diversification is declining, as the country continues to suffer increasing economic degradation. Lack of local regulation contributes to the difficulties experienced by providers in these regions.

While South Africa has a more robust regulatory framework, challenges remain. ‘Foreign service providers’ require regulatory approval from the Financial Services Board, which is accompanied by increased compliance liability and costs. Substantial opportunities in parts of the continent mean competition is increasing. Growing numbers of international entrants are making it harder for investment management firms with offshore capabilities to capture market share.

Channel Islands-based providers with the suitable regulatory licence (there are currently relatively few) stand in good stead to benefit from opportunities coming out of Africa. South Africa’s strong regulatory framework is largely based on UK regulation, allowing companies with experience of such regulation to support local firms, providing guidance on best practice.

Africa

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july/august 2016 21

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The weakening of the rand, and political and economic uncertainty over South Africa remain a strong argument for offshore diversification. Alongside relaxation of exchange controls and the Special Voluntary Disclosure Programme, announced as part of the 2016 budget, this environment has facilitated greater levels of offshore investment. In December 2015, the South African Reserve Bank reported that South African investment abroad had reached its biggest quarterly outflow on record – 24.2bn rand, compared with 10bn rand in the previous quarter.

Turning to the wider continent, estimates are that the African investment market will grow by seven per cent per annum over the next 10 years. Ghana and Kenya are often seen as the most promising emerging African markets, with increasing diversification across their economies and a growing middle and high-net-worth demographic.

Botswana and Namibia are often overlooked, although both also present opportunities. The former enjoys stability, steady economic growth and a sophisticated financial services capability. The latter, too, has smaller pockets of wealth, where offshore diversification opportunities are well received.

Regulated, independent international firms are well received by African clients seeking true international exposure. Jersey and Guernsey have both built strong reputations in Africa as reputable finance centres built on innovation and a supportive but robust regulatory framework. This places Channel Islands-based investment management firms in a strong position to provide African residents with a stable and secure investment environment against an often uncertain backdrop. n

far eastPAUL HODGSON, MANAGING DIRECTOR, BUTTERFIELD TRUST (GUERNSEY)The Asian region continues to present opportunities for fiduciaries based in the Channel Islands. The recent opening of the Guernsey office in Hong Kong is a logical development of its initial investment in a Shanghai office nine years ago. Jersey has had an office in Hong Kong since 2009 and now has a ‘launchpad’ presence in Shanghai through the China Britain Business Council.

These offices have seen recognition of the jurisdictions significantly improve. In the past, a Hong Kong lawyer told a local service provider they didn’t deal with Guernsey or Jersey as they would “only work with first-class offshore financial centres, such as the Channel Islands”!

Despite lower economic growth in the region from the very high levels of recent decades, factors continue to underpin opportunities for Channel Islands-based fiduciary service providers. The sophisticated structures in which the islands specialise are well suited to holding the range of assets accumulated by wealth-generating Asian families, including business assets, and allow principals to develop strategies for dealing with issues around succession planning and wealth protection. In particular, both islands are used to structure holdings in Asian-based businesses that are being listed, usually on the Hong Kong Stock Exchange. The current strength of the IPO market in Hong Kong is therefore expected to benefit local service providers.

It’s important to distinguish between the principal financial centres and understand which countries tend to favour them. Hong Kong is preferred by families from China, Taiwan and the Philippines; Singapore by families from Indonesia, Malaysia and Vietnam. Each of these countries has differing needs and attitudes towards structuring, so the region doesn’t represent a one-size-fits-all opportunity. This is why the Channel Islands’ mature wealth planning and structuring services are so well suited to this market.

Until recently, succession planning has been based on simple structures, as fee sensitivity has been high. However, as families have become more global in their residency patterns, they’ve been driven towards sophisticated structures. In doing so, we’re able to demonstrate our expertise in designing and implementing

complex structures. This could include the use of private fund structures such as Guernsey and Jersey limited partnerships.

An early challenge in such discussions is that the concept of giving away one’s assets to a third party is unnatural to business owners who want to keep control of their wealth. This often leads to consideration of innovative and complex structuring. One solution to this dilemma could be the transferring of assets into a vehicle that doesn’t conflict with the desire for control, such as a reserved powers trust.

Having identified the opportunities that Asia presents to local fiduciaries, it’s

also important to consider some of the principal barriers that

have historically meant, for some, that the region remains in the ‘too hard’ basket. This has included difficulty in obtaining and verifying due diligence and source of wealth to

the standard required by local regulations. But this is

changing as local standards in this area increase.

In addition, both Hong Kong and Singapore are themselves seen as alternative jurisdictions for structuring for non-residents. Particularly in Singapore, the level of competition has meant that fees have been driven to uneconomically low levels for Channel Islands-based practitioners.

Finally, for some potential users, Asian language capability is seen as a necessity and a presence in the region a benefit. For most local fiduciaries, these have been the reasons for losing opportunities that were otherwise attractive. Despite these challenges, families in the region are moving towards proven, expert and well-regulated jurisdictions such as Guernsey and Jersey, and the more sophisticated and robust structures in which we excel. n

The views expressed are those of the author and do not necessarily reflect the opinions or views of Butterfield Trust (Guernsey) or its affiliated companies.


Finance

GRAEME FAIRLIE, HEAD OF BUSINESS DEVELOPMENT, AND JUSTINE WILKINSON, DIRECTOR, FAIRWAY TRUST The Middle East offers huge opportunities to those financial service providers who are prepared to offer a long-term commitment to the region. This has been apparent from recent marketing visits from the Channel Islands to the region, which have included Bahrain, Dubai, Lebanon, Oman, Qatar and Saudi Arabia.

Local political instability and a growing trend to diversify away from the reliance on oil prices – coupled with the volatility in the region, which is likely to continue – have all resulted in an increased demand for offshore structuring services.

As the oil price falls, infrastructure subsidies in some GCC countries are under review and there have been discussions on introducing taxes in the UAE from early 2018 – the impact of which should be considered by clients from the region.

Whilst these all result in challenges for clients in terms of their local wealth, it also provides a number of opportunities as, in turn, those clients seek new investments and bespoke offshore structuring to house their assets. Clients are therefore investigating how and where they wish to structure their assets and family wealth going forward.

Wealthy Middle Eastern families are known to select their working partners very carefully. Experience and trust in the

relationship is as crucial a factor as the preservation and safeguarding of their family wealth. This type of confidence doesn’t happen overnight, so wealthy individuals build up their trust and relationship with those working partners over time. Clients want advisers who are not only professionally qualified and experienced but who also have a regular presence in the region. This is a pre-requisite to long-term relationship building.

For professional advisers with either a local presence or a commitment to the region with a regular visiting schedule, there is a great opportunity to develop and enhance the reputation of the Channel Islands as a world-class jurisdiction.

In the private client world, we’ve seen an increasing demand for bespoke private wealth structuring to preserve and protect family assets. Similarly, in the corporate client world, there’s been an increase in

the number of UAE-based managers wanting to establish regulated funds in order to hold real estate investment in the GCC countries. In each case, this has been driven by clients and investors in the region wanting the governance and additional scrutiny that comes with the highly regulated environment in Jersey or Guernsey.

The proximity of the Channel Islands to the UK is an added advantage in terms of accessibility to London and its professional advisers, and that’s coupled with the lack of language, time zone and currency barriers.

Whilst the islands themselves remain outside the European Union, the effects of the outcome of the UK referendum on the EU will be felt.

There’s no doubt, however, that Jersey and Guernsey will react quickly and efficiently to maintain their status as respected international finance centres. n

EMMA RUSSELL, PARTNER, CAREY OLSENWhile, at the time of writing, the UK faces uncertainty ahead of the EU referendum, the US has its own reasons to be unsettled, with the race to the White House well underway and Donald Trump as the presumptive Republican presidential nominee.

Financial markets have always been affected by the US presidential campaign, but this one seems to have brought a higher level of uncertainty to global economies and there is a general consensus that the US market is holding its breath.

The restrictions imposed by increasingly complex financial reporting are also having an ongoing impact, including those imposed on fund managers based outside the European Economic Area through the Alternative Investment Fund Managers’ Directive (AIFMD).

Increased competition from other investment fund jurisdictions, such as Luxembourg, also has a bearing, as does the Volcker Rule, which restricts US banks from making speculative investments that don’t benefit their customers, as part of the Dodd–Frank Wall Street Reform and

Middle east

united states Consumer Protection Act. All this, however, hasn’t prevented the Channel Islands from remaining the leading jurisdiction for establishing fund marketing on a global basis. Of the big four buyout funds (all Guernsey domiciled) coming to market this year, plus the recent $7bn raised by Coller Capital (also Guernsey domiciled), where there are numerous US investors, it continues to be a very positive climate for the islands and their relationship with the US.

With the introduction of the European Securities and Markets Authority (ESMA), which aims to improve the functions of European financial markets and strengthen

investor protection and co-operation between competent national authorities, the relationship between the US and the Channel Islands should continue to strengthen.

ESMA delivered an opinion to the EU Parliament, Council and Commission last year, issuing advice on the potential extension of the passporting regime to the management and/or marketing of funds by non-EU AIFMs and to the marketing of non-EU funds by EU AIFMs. The long-awaited announcement assessed that managers and funds based in Guernsey and Jersey may, once in receipt of their passport, be marketed to professional EU investors, subject to meeting a number of regulatory obligations. This is a positive step for US funds looking to market in the EU through the Channel Islands without the pitfalls that accompany greater regulation.

Guernsey and Jersey are particularly well positioned to nurture these relationships and to continue to educate the US market on their pedigree as leading offshore centres, with compliance and regulatory standards that are best in class. n

All opinions were written prior to the UK’s referendum on Europe on 23 June.

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Finance

Words: Kirsten Morel

The

The revelations in the leaked Mossack Fonseca documents were a journalist’s wet dream. But as the dust settles, what have we really learned? and did the whole situation give the Channel Islands a golden opportunity to differentiate themselves from less well-regulated offshore jurisdictions?


Finance

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2015 ‘John Doe’, the anonymous source of the Panama Papers leak, contacts German newspaper Süddeutsche Zeitung with the Mossack Fonseca files. It, in turn, contacts the International Consortium of Investigative Journalists for help working through the more than 11 million files. Analysis lasts for more than a year and includes in excess of 100 media organisations from over 80 countries.

PANAMA PAPERS – A TIMELINE

papersIT’S STRANGE TO think that it was only a few months ago that the Panama Papers exploded into the public consciousness. And explode they did – making 3 April a startling day for trust businesses, fund administration companies, tax advisers and countless other professional services firms.

Not only was it the day that Panamanian law firm Mossack Fonseca realised it should have invested more heavily in information security, but it was also the day the rest of the world got its first sense of the true scale of the ‘offshore’ system of finance.

The Guardian got straight to the point with its story Panama Papers: How the world’s rich and famous hide their money offshore. The leak gave an eye-watering glimpse of the different types of people and firms that use offshore centres.

The headlines tended to the salacious, but the stories themselves weren’t so much filled with evidence of wrongdoing, rather painting a picture of a two-tier system in which the wealthy can choose their tax systems while the rest are left to pay at home, in full.

The Guardian had been working for a year with the International Consortium of Investigative Journalists (ICIJ), which itself had enlisted the help of hundreds of journalists and dozens of media organisations to examine and analyse the cache of over 11 million documents that had been leaked by an unknown

source to German newspaper Süddeutsche Zeitung. There were individuals who fell foul of the leaks.

Most famously, Prime Minister of Iceland Sigmundur Davíð Gunnlaugsson was forced to resign over revelations of his wife’s ownership of a BVI company.

David Cameron was livid that his late father’s investment fund was drawn into the fray, but rather than come clean about something that wasn’t very damaging, he prolonged the agony in a move which made matters look worse than they were.

Then there was the news that some of Vladimir Putin’s most trusted aides owned a variety of offshore structures – and, perhaps to no one’s surprise, FIFA’s name came up more than once.

Given the scale of the leak, however, there were few signs of illegality – one instance saw five people arrested by Uruguay for money laundering on behalf of a Mexican drug cartel.

The Channel Islands governments most likely breathed a sigh of relief as it became clear that there was little in the Papers that was directly damaging, beyond Jersey’s name being linked to the money laundering of a gold bullion robbery – the 1983 Brink’s-Mat raid.

Both Jersey and Guernsey were also found to have used and been used by Mossack Fonseca, but neither island featured prominently, which says something

3 April 2016 The first news stories are published alongside 150 of the leaked files. The initial focus is on the scale of the use of international finance centres and the people who use them, even if legally. Much is made of the inclusion of key aides to Vladimir Putin.


Finance

5 April Iceland’s Prime Minister, Sigmundur Davíð Gunnlaugsson, resigns after acknowledging that his wife is a shareholder in an offshore company.

6 April Both the European football authority UEFA and its global counterpart FIFA find themselves caught up in stories breaking from the Panama Papers leak. Swiss police raid UEFA’s offices and FIFA official Juan Pedro Damiani resigns.

7 April In an attempt to restore confidence in Panama, the country’s President, Juan Carlos Varela, announces the establishment of an independent committee of international experts, including economist Joseph Stiglitz, to evaluate practices within the Panamanian financial sector.

12 April Panamanian authorities raid the offices of Mossack Fonseca.

▼ in itself, given that the Panama Papers have provided information on 214,000 entities.

There may not have been anything to directly harm the Channel Islands, but the Papers have been effective in fomenting international opinion against the perceived injustice of the global financial system.

“The leaks have created an unprecedented public outcry about the use of these jurisdictions for all sorts of activities,” says Monica Bhatia, Head of the Secretariat of the Global Forum on Transparency and Exchange of Information for Tax Purposes at the OECD. “The Panama Papers have made political leaders realise that there is a problem and someone needs to be doing something about it.”

TARRED BY THE SAME BRUSH Whether they like it or not, Jersey and Guernsey are perceived to be a part of that ‘problem’. “There’s a perception that all offshore centres are the same, but this isn’t true,” says Richard Hay, Tax Partner at Stikeman Elliott in London. “The Panama Papers have created quite an uninformed climate around international finance centres [IFCs].”

UK Leader of the Opposition Jeremy Corbyn talked about imposing direct rule on those Crown Dependencies and Overseas Territories that failed to come into line. But the Prime Minister announced that he had secured agreements that “will provide UK law enforcement and tax agencies with full access to information on the beneficial ownership of companies… For the first time, UK police and law enforcement will be able to see exactly who really owns and controls every company incorporated in these territories. Cayman Islands, British Virgin Islands, Bermuda, Isle of Man, Jersey… the lot”.

The reality of the Panama Papers is that, like it or not, at a global level the Channel Islands aren’t seen as being particularly different from those jurisdictions that are less well regulated or drag their feet when it comes to complying with international standards.

“One of the problems we’ve had is the collateral effect of the Panama Papers. The press have been able to achieve an impact that treats all offshore entities the same,” says John Harris, Director General of the Jersey Financial Services Commission. “That, in essence, is the potential reputational impact, and it puts a

premium on communication. We have to communicate.”

As one of the people tasked with communicating the Channel Islands’ message, Geoff Cook, CEO of Jersey Finance, has to grapple with the task of differentiation.

“Our challenge is to create clear water between us and other jurisdictions with lower standards,” he explains.

“We have prioritised policy makers and spent a huge amount of time visiting and educating governments and major global brands. I’m concerned about the broader media coverage, which affects the popular view by lumping us together with other jurisdictions. But we do what we can with the more informed media – the Financial Times and the Evening Standard, for example.”

Across the water in Guernsey, the view is that the people who matter do actually get the difference between the Channel Islands and elsewhere. Whilst what is seen as uninformed criticism is frustrating, it’s not the most important element, as long as the message keeps getting through to the people in power.

“Nobody in the finance industry thinks there are similarities between Panama and a well-regulated jurisdiction like Guernsey,” says Dominic Wheatley, Chief Executive of Guernsey Finance. “Our peer group, with regard to important matters of regulatory transparency, puts us together with Western European financial centres. Panama falls well short of modern standards of regulation and transparency.”

SHARING INFORMATIONIf the media fallout from the Panama Papers leak is uncomfortable but not unbearable for Jersey and Guernsey, are there likely to be other pressures from the UK or the global community that may affect the islands’ ability to do business?

The islands are already publicly committed to the implementation of the OECD’s Automatic Exchange

14 April UK Chancellor George Osborne unveils a deal to automatically share information with Germany, France, Italy and Spain on the ultimate owners of companies.

21 April Isabel Saint Malo de Alvarado, Vice President of Panama, publishes an article in which she says that ‘Panama is not to blame for the Panama Papers’ and that the country can play an important role in increasing global financial transparency.

The Panama Papers have created quite an uninformed climate around international finance centres

▼

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of Information Initiative, but that doesn’t mean there won’t be further demands down the road.

The OECD is drawing up criteria for a blacklist of non-cooperative jurisdictions, following a request from the G20. As Jersey and Guernsey know, blacklists do provide an incentive to quick action.

“Some countries that weren’t committed are now committed, including Panama, Bahrain, Nauru and Lebanon,” says Monica Bhatia. “But there’s no let-up. There will also be work done on beneficial ownership.”

Indeed, while both islands probably feel they have little to fear from the blacklist criteria being drawn up at the OECD, the issue of registers of beneficial ownership has gained prominence as a result of the Panama leak.

Shortly after the Papers became public knowledge, the UK played host to an international anti-corruption conference, which David Cameron used to unveil new partnerships to enable the automatic exchange of information, alongside the UK’s own commitment to a public register of beneficial ownership.

The Channel Islands were already signed up to the exchange of information between governments and their agencies, but the UK’s lead on a public register has led to calls for the islands to follow suit.

Richard Hay sees this as a knee-jerk reaction and goes further, questioning the need for more registers at all. “The Common Reporting Standard [CRS] requires jurisdictions to exchange information annually. We’ve already got that, but now we’re going to replicate it with an exchange of registers,” he says. “You’ve got to ask, what is your goal? If it’s to have proper information available to the government, then there’s no need to have registers open to the public.”

There’s also an issue with the fact that most registers take the form of self-certification, which, Hay explains, brings into question their effectiveness at combatting crime.

“If your objective is tax and law enforcement, then you have to take on board the fact that only the compliant will file,” he explains.

Jersey and Guernsey’s refusal to entertain public registers shows that whilst being compliant, they aren’t willing to accept regulations that don’t have an understandable rationale. “Generally, we try to pursue a cooperative approach,” says Geoff Cook. “So we would

always think long and hard about saying no. We have said no to public registers but backed this up with our own experience and legislation.”

WHAT NEXT?Wheatley believes there’s little on the horizon to suggest much will change for the Channel Islands – assuming there are no hidden bombshells among the millions of files yet to be released, that is. “I doubt there will be any new legislation because there has been very little of consequence that has come out. Most of the findings have been legal and not even unethical.”

The question of ethics, however, may turn out to be the most significant point, and one that Jersey and Guernsey could find harder to answer. “We’re a part of the whole moral and ideological debate about economic models,” says Harris.

If that weren’t a large enough challenge, he adds: “You’re up against a stereotypical understanding of the issues which brooks no argument.”

The Panama Papers have had an enormous effect on Panama, which is now so taken by compliance with international standards that it’s appointed the Nobel prize-winning anti-tax-haven economist, Joseph Stiglitz, to an enquiry into the country’s finance sector.

Beyond the eponymous country itself, the Papers have also reignited the debate about the role of IFCs and their activities within the world’s financial system. However, as long as they weather the media storm and remain cooperative, the signs are that the Channel Islands shouldn’t experience too much fallout.

As Bhatia puts it: “[The islands] have been peer-reviewed as having satisfactory standards. We have a positive view of their activity, both in terms of resources and personnel that they provide to the Forum and the standards that they have adopted.”

All Jersey and Guernsey need to do now is get that message across to the wider population. n

KIRSTEN MOREL is a freelance financial writer

12 May In a letter to Jersey’s Chief Minister, the UK Chancellor says: ‘Jersey has taken a lead on global transparency as a cooperative jurisdiction.’

12 May UK hosts a global anti-corruption summit at which David Cameron announces plans for Britain to create a public register of companies that buy or own UK property. He also gets countries including Afghanistan and Nigeria to commit to public registers of company owners.

16 May Academic study finds ‘firms with exposure to any of these major havens lost roughly $230bn in market capitalisation’ due to the Papers leak.

28 May Mossack Fonseca announces the closure of its Jersey, Isle of Man and Gibraltar offices, citing its strategy to ‘consolidate our service office network’ as the reason.

2 June European Parliament agrees to set up an inquiry committee into the revelations. The 65-member panel will look into offshore companies and their beneficiaries. Political heavyweights, including George Osborne, are expected to be called to give evidence.

15 June An IT worker at the Geneva office of Mossack Fonseca is arrested on suspicion of removing large amounts of data.

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To speak to our Channel Islands team, call (01534) 282076.

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Guernsey business address: P.O. Box 62, Royal Bank Place, 1 Glategny Esplanade, St. Peter Port, Guernsey GY1 4BQ. Regulated by the Guernsey Financial Services Commission and licensed under the Insurance Managers and Insurance Intermediaries (Bailiwick of Guernsey) Law, 2002 and the Protection of Investors (Bailiwick of Guernsey) Law, 1987, as amended.

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Finance

As much as some people live in hope that a startup might one day take over the banking world, it’s not likely to happen. But that doesn’t mean change isn’t afoot

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Words: Jack Flanagan

THERE’S AN OUNCE of social justice to the idea of disruption in the banking world. The sector is maligned as the most amoral (next to journalism), and there’s a hope that the incumbents will ‘get what they deserve’ and be overthrown by rosy-cheeked startups.

Given what’s happened in the past 10 years, this attitude is perhaps unsurprising – but unlike the worlds of taxicabs and hospitality, the possibility of a complete newcomer taking over global banking in a matter of years was always going to be nothing more than a pipe dream.

The history of banking is one of slow evolution, not radical change. The green screens and paper spreadsheets of the 70s graduated to PCs and email. Today we’re at the tail end of the reaction to internet banking, where most banks have generic digital offerings, and some have sophisticated CMD (customer management databases) for client care. Given time to do so, banks have managed to keep up.

Of course, technology moves fast today and, in certain industries, those who’ve failed to keep up have been left behind.

The Uber parable tells the story best. Founder Travis Kalanick found the sweet spot between technology and customers,

and in doing so devastated taxi ranks around the world.

For at least a decade, banks have been like the old-fashioned taxi ranks. Post-financial crisis, and with heavyweight tech companies like Google and Apple breathing down their neck, they look like old dragons – gorged with gold, ripe for slaying. So while there may be no Uber of banking, should the banks be concerned about threats to their stranglehold?

TOO BIG TO FAILTo talk about disruption in banking has echoes of a conversation started 20 years ago. There was once confident talk that the banks were on the way out. Startup bank Egg, which lasted less than a decade after being founded in 1998, rose quickly and fell just as quickly. It was thought at the time it would be the one to disrupt the long-vilified banking sector. Evidently it didn’t. Instead of disrupting banks, Egg just replicated their services online, and when it failed, was divvied up among them.

Using Egg as an example could seem like extrapolating. However, looking at the four challenger banks listed in a 2016 Tech World article – Atom, Mondo, Starling and Tandem (all UK-based) – none offers a new

service, and only two have a banking licence, so the other two can’t even legally call themselves banks.

To some, the idea that innovation in banking hasn’t thrived is unsurprising. Mark Loane, CEO of C5 Alliance, understands the stark contrast between the interests of taxi customers and those of banks. “Customers don’t care what taxi they use – they go for whatever will get them there fastest. These days that’s Uber and its competitors who provide taxis quicker. On the other hand, challenger banks can only really offer a nicer online interface. They’re asking you to put your savings into them – it’s not going to happen, frankly.”

The number one asset that large banks have against small ones isn’t money, but trust – which is slightly ironic considering the events of the financial crisis.

Loane takes the view of most banking customers today. “I’m a technology-first person, but I put my money in an old investment bank. They have equity to support it and they’re large, so shouldn’t fail and disappear with my money, despite having a rubbish internet offering.”

Trust blocks off a huge part of the market. Customers make their choices on

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personal testimonies and a recorded history of safe, transparent banking, and technology can’t recreate these – forgoing a time machine. To customers, challenger banks look risky.

And aside from this, there are the practicalities – running a bank isn’t cheap or easy by any means.

“Trust is one barrier: the cost of capital and regulation are another, which make it hard to earn any money,” says Amit Taylor, Group Managing Director of Trust Corporation International.

He also believes the banking system is so deeply embedded that any new operator would have to work with the established banks, pointing to “the way the online payments system works, which is largely through the hands of incumbents”.

ONES TO WATCHSo while there’s no risk of the banks being driven out of business any time soon, it doesn’t mean there aren’t corners of the financial services world that aren’t seeing new operators (and technologies) making their mark. Payment solutions is one of the most rapidly advancing areas.

The payment solutions space has been positively polluted with startups. All of them claim to make payments faster, easier, and even cheaper – but their main advantage is they are cashless. Incumbent banks can’t even get a foot in the door.

But what’s perhaps most interesting is that companies with pre-existing customer bases, such as Apple and Google – with ApplePay and Google Wallet – are providing payment solutions, incorporating mostly generic concepts into already popular products such as the iPhone.

And while the concept of paying via gadgets isn’t itself novel, the entry of large tech companies is. Unlike most challenger

banks, they have already established trust – who hasn’t used Google, or heard of Apple? So the greatest barrier to entry doesn’t apply.

However, although they nip at the peripheries, new innovations in themselves can’t displace a bank. There’s still too much they offer. Yet it’s surprising that when surrounded by so much innovation in fintech, banks aren’t more responsive. Don’t they recognise their vulnerability?

“Some banks simply have their heads in the sand with the respect to potential disrupters,” says Taylor. “Then, on the other side of the spectrum, you’ve got Goldman Sachs, which is at the forefront of fintech and is a big bank. In my view, since 2008, most banks haven’t been focused on innovation, but on the challenge of diminishing margins.”

Taylor’s citing of Goldman Sachs is an interesting case in point. Along with a number of other banks – such as Citigroup, Barclays, Morgan Stanley and Wells Fargo – it is an active investor in companies and incubators, such as mobile payment newcomer Square. Unlike its counterparts, it has also made fintech acquisitions, including digital retirement savings platform Honest Dollar and securities trading platform Pantor.

All the same, like any acquisitive company, it’s often cheaper to buy a startup than put in the R&D time yourself – and you can also shut down any potential threats in the process.

Mark Loane believes a time will come when banks and fintech meet in the middle, rather than a sudden usurper taking over. Fintech adviser and investor Geoff Miller describes it vividly as “death by 1,000 cuts”.

“It’s not going to happen quickly,” he says. “There’s a window of opportunity to innovate. Banks are setting up innovation budgets now and looking to collaborate to avoid the disruption that fintech implies. Their strength, brand, sticky client base and services will keep them competitive.” n

JACK FLANAGAN is a freelance business writer

since 2008, most banks haven’t been focused on innovation, but on the challenge of diminishing margins

According to fintech adviser and investor Geoff Miller, this is a truly fascinating time for technology and financial services. He points to a couple of areas of particular interest.

Miller highly rates new developments in risk, specifically due diligence and extraction software, in companies such as Verus360. It was once the case that insurance companies factored ‘lying’ into any insurance agreement. Over the past 10 years, extraction software for due diligence has advanced to make the lending process more personalised. Today, such software can build a sturdy portfolio for each case from pre-existing data, and yet be dynamic to changes in their situation. This decreases risk for both businesses and customers.

“This software takes all the data for a potential investment and puts it into a standardised format,” Miller explains. “You can then take a decision on whether to give that business or person credit. Before this, insurance companies simply factored into your price how likely you were to lie. It also works in reverse, so, as a customer, you could tell how much you could get from different banks – £30,000 from Santander, £50,000 from Barclays. Banks are now lending in a more responsive, dynamic way, with an accurate understanding of a company’s history.”

Blockchain technology (famously behind another rocky would-be disruptor, Bitcoin) is also a fast-moving sector, says Miller. “Blockchain has potential. It will probably be a big story next year. These distributed ledger technologies [a term for the tech family tree to which Blockchain belongs, where risk is reduced for all parties in a transaction] have huge potential, but there’s still some way to go before they can be termed ‘disruptors’.”

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Corporate Commercial & TrustFrom finance houses and utility companies to entrepreneurial start-ups and internet businesses, we understand that you need high quality accurate and pragmatic advice.

At Parslows we work closely with our clients to ensure a prompt and practical service that you can rely on.

For expert advice, please call Mason Birbeck on 01534 630530.

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Mason Birbeck, Head of the Corporate, Commercial and Trust team at Parslows, questions whether the influence of ethical considerations will achieve HMRC’s objectives for Jersey Hastings-Bass and mistake applications

THE LAW LORD Lord Neuberger described the rule in Hastings-Bass as “a magical morning after pill for trustees suffering post-transaction remorse”. Its evolution in Jersey – and that of its bedfellow, the doctrine of mistake – exemplifies how law develops over time.

The rule provides that where a trustee exercises discretionary power under the trust terms, ignoring relevant considerations or taking into account irrelevant considerations, having effects different from what the trustee intended; the Court can set aside the transaction if satisfied the trustee would not have acted as it did but for that error (Re the Green GLG Trust [2002] JLR 571).

In the event of mistake, the Court can set aside a transfer of property onto trust, applying a threefold test (Re the Lochmore Trust (2010) JRC 068). Was there a mistake on the part of the settlor? Would the settlor not have entered into the transaction ‘but for’ the mistake? Was the mistake so serious as to render it unjust for the donee to retain the property?

Both are remedies exercisable at the Courts’ discretion.

Until March 2011, Jersey and English law seemed largely aligned, the Jersey courts having followed a long-established line of English cases.

However, in Futter v Futter and Pitt v Holt, the English Court of Appeal held that the previous English cases had over-extended the Hastings-Bass principle and that, absent a breach of trust, trustees’ proper recourse for financial loss suffered should be to the advisers who were in error. It therefore removed a previous escape route from unforeseen tax consequences.

Mason Birbeck can be contacted at [email protected] or on +44 1534 630530. www.parslowsjersey.com

It also criticised the Jersey courts for ignoring the distinction between effects and consequences in applying the doctrine of mistake, and as ‘a great deal too relaxed’ in permitting settlors to set aside transfers onto trust.

There was a short-lived debate as to whether the Jersey Courts could continue to ‘plough their own furrow’ in an area of law heavily reliant on English case authority. This became moot when, in October 2013, the Trusts (Amendment No. 6) (Jersey) Law 2013 introduced an expanded statutory framework for Hastings-Bass and mistake applications.

The legislation confirmed that Jersey was indeed going to plough its own furrow.

SET IN CONTEXTOne cannot ignore the public policy context – a 2006 declaration of intent by HMRC to intervene in Hastings-Bass and mistake applications, and heightened UK sensitivity to tax avoidance.

In Re the S Trust (2011), Jersey’s Royal Court expressed itself troubled by the weight given to HMRC’s interests by the English Court of Appeal in Futter v Futter and Pitt v Holt. It said of HMRC: ‘Leviathan can look after itself’, adding ‘…in Jersey it is still open to citizens so to arrange their affairs, so long as the arrangement is transparent and within the law, as to involve the lowest possible payment to the tax authority. We see no vice in this approach’.

Contrast this with more recent statements of the Royal Court regarding the exercise of its discretion under the new statutory formulation of the Hastings-Bass and mistake principles.

In IFM Corporate Trustees Limited [2015] JRC 160, the Court acknowledged strong ethical arguments why tax payers should recognise their obligations to the state in which they live, making their fair and appropriate contribution.

The Bailiff said: “There is room for the argument that the discretion ought not to be exercised if, on the facts of a particular case, the scheme in question is lawful but appears to be so contrived and artificial that it leaves the Court with distaste if, in effect, it is required to endorse it.”

In In the matter of Wentworth Trust and the Great Escape Trust [2015] JRC259, the Court referred to the applicants’ ‘misguided attempts to avoid their obligations as citizens of the United Kingdom’.

It said: ‘There is something unattractive about the proposition that the Court should come to the rescue of foreign taxpayers who, anxious to avoid paying the contribution towards the outgoings of their own jurisdiction’s government, and thus meet their own obligations as citizens of that jurisdiction, make schemes of this nature.’

If such ethical considerations do come to influence the Courts’ exercise of discretion, the practical result may be limitations having equivalent effect to the legal constraints HMRC previously sought but failed to convince the Jersey Courts to apply to the scope of the rule in Hastings-Bass and the doctrine of mistake. n

Hastings-Bass:striking a balance

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Playing the waiting gameESMA may have recommended the Channel Islands for the AIFMD passport, but there’s no clarity on when it will come into effect. so what’s the current state of play?GOOD THINGS COME to those who wait, apparently. It’s been a year since the European Securities and Markets Authority (ESMA) told the European Commission (EC) it would recommend Jersey and Guernsey for third-country passports, which would allow the islands’ fund managers to market their wares across the EU under the Alternative Investment Fund Managers Directive (AIFMD). Twelve months on, there’s still no passport, nor is there any immediate sign of one. And so the wait continues.

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Words: Dave Waller

It was last July that ESMA announced its conclusion that ‘no obstacles exist to the extension of the passport to Guernsey and Jersey’. At the time, it felt like a win for the islands – Switzerland was the only other country to be recommended – and only then on condition that it changed

some of its laws. Meanwhile, ESMA failed to

come to any conclusion on the other three financial services

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strongholds it examined – Hong Kong, Singapore and the US.

So after such a promising start, why has nothing come of it? First, ESMA also recommended that the EC shouldn’t introduce passports until it has a good view on how its own member states have fared with AIFMD. But many haven’t enacted the complex regulations yet.

The EC, acting on another of ESMA’s recommendations, then confirmed in December last year that it would only make a decision on extending the passports when a sufficient number of third countries had been assessed.

“We don’t know what a sufficient number is, of course,” says Andrew Weaver, a Partner at Appleby. “So we’re still in the waiting game. On the one hand, Jersey and Guernsey have been told that we’re great. On the other hand, they’re saying they’re not going to let us in the door until they’ve seen others.”

So, given the lack of concrete outcome, has the passport recommendation actually meant anything for the islands’ funds industries? Simon Schilder, a Partner at Ogier, believes it has. “Market confidence among those in the funds industry regarding the Channel Islands has been

good because of it,” he says. “For managers of funds aimed at EU-based investors, who are looking at potential jurisdictions to structure those funds, the Channel Islands recommendation gave certainty, which has definitely helped.”

The delay in getting the passport is also softened by the success of the National Private Placement Regime (NPPR), a stop-gap solution that allows fund managers to market to the EU on a state-by-state basis. Hence there are plenty of reasons why someone raising a fund and wanting to structure offshore would come to the Channel Islands.

JUGGLING JURISDICTIONSAs for when this stop-gap will become anything more permanent, the jury is still out. ESMA is a relatively small organisation, charged with assessing the suitability of non-EU jurisdictions – of which there are many. At the time of going to press, it is due to finish the assessments on Hong Kong, Singapore and the US, plus a further six – Japan, Canada, the Isle of Man, Cayman Islands, Bermuda and Australia.

ESMA also relies on the co-operation of each jurisdiction in helping it speed through the assessment. While a funds-reliant jurisdiction like Jersey jumped at the chance to get the passport, and so made life easy for its assessors, the US has a massive funds industry to investigate and happens to have other issues it will see as more pressing – not least its upcoming presidential election. But for a country with its eyes firmly somewhere else, the US could wind up playing a major part in dictating when the passport comes in.

“ESMA won’t introduce the passport if it causes market disruption,” says Schilder. “But there would be market disruption if you introduced it without giving it to the US and Cayman Islands, given their significance to the funds industry. Cayman is keen and has been diligent with answering questions from ESMA, but it’s not as important for the US, so they’ve maybe been less diligent.

“It’s unfathomable that the EU could introduce the regime without the US, but at what point do they get comfortable with what the US is doing?”

Weaver points out that it’s not just a matter of getting through the assessments and dishing out passports. “Imagine the EC turns around saying seven of the assessed jurisdictions are suitable, five not,” he says. “Would they say it’s OK to give the passport to those seven? Or would they

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ESMA

say seven isn’t a big enough pool, and send ESMA back out to assess another load of jurisdictions. We don’t know.”

In the meantime, the EC has modified what it wants from ESMA – not only an assessment of each jurisdiction’s suitability for the passport, but a detailed assessment of the capacity of their regulators and their track record of enforcement too. So even with the recommendation in the Channel Islands’ back pocket, they’ve still had to answer the door to the assessors again.

“They have a few more questions on a number of things, to get more detail,” says Mike Jones, who as Policy Director at the Jersey Financial Services Commission has been in talks with ESMA.

“It’s quite a technical piece of work and there are always issues, but we’re in a very good place. For example, they’re looking at Jersey’s AML regime, and our report has as good a rating as any jurisdiction in the world. We don’t think there’ll be any potential issues, so we’re kind of as we were.”

Which, unfortunately, is back to playing the waiting game.

BEST OF BOTH WORLDSIt’s easy to assume that the funds industry on the islands must be getting frustrated by the merry-go-round, but that’s not necessarily the case. Much of the industry is happy as long as the NPPR route to EU marketing remains open. They have

a combination of a positive endorsement from ESMA, NPPR access, and the ability to provide optionality: if a manager isn’t touching the EU, they can still use a Channel Islands fund and not have to comply with the full rigour of the directive.

“It’s not having a massive impact on our clients’ structures now,” says Stuart Pinnington, Head of International Client Services at JTC Group. “There’s huge money coming from the US, Middle East and Asia that doesn’t care about AIFMD. Plus we’ve got the NPPR, and the JFSC did well to get that working.

“It’ll be good to know about the passport, but I don’t think there’s anyone on the islands who doesn’t believe we’re going to get one at the front of the queue. We all just get on and do our thing – it’s not as big an issue as it might appear.”

Pinnington makes another key point: the fabled passport isn’t the only thing that fund managers have to think about right now. In fact, the landscape for managers and investors is wildly uncertain in any number of ways. “There are a whole host of other drivers that are having an impact, from Donald Trump to Brexit,”

he says. “Brexit needs to be sorted out. The majority of the Channel Islands’ fund manager base is located in the UK. What affects those guys clearly has an impact on the industry here.”

But even with the many ifs and buts affecting the industry, would it be good if the passport came in sooner, so the islands could steal a march on rivals that aren’t recommended? Maybe, but given the EC’s plans to build a larger pool of passports, that’s unlikely to happen. And what would happen to the NPPR system if and when the passport does come in?

“If there’s an obligation to switch off the private placement regimes, I’m not sure which would be the better option,” says Weaver. “Having both at the same time would be an excellent outcome for us, but we’ll see. We could find we have passport rights but not NPPR access, where Cayman could keep private placement access and not passport rights. And it’s difficult to see which would be best right now.” n

DAVE WALLER is a freelance business writer. This article was written prior to the UK’s referendum on the EU.

It’s unfathomable that the EU could introduce the regime without the US, but at what point do they get comfortable with what the US is doing?

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underperformance?


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Words: Chris Menon

STOCK MARKETS AROUND the world suffered incredible volatility in the first half of 2016 for a whole range of reasons – not least the lead-up to the EU referendum, economic weakness in the Far East and an uncertain oil price. And things don’t look set to change any time soon.

In the middle of June, the FTSE 100 fell below the 6,000 mark once more, standing lower than it did at the start of 2013, and way below the highs of 2015. At the time of writing, prior to the EU referendum on Europe, there are fears that stock markets will ‘tank’ should voters opt for a Brexit.

With this in mind, troubled investors who have money in funds that have fallen in value, and may well fall further, might reasonably expect those funds to share some of the losses. Sadly, the vast majority of investors are going to be disappointed and will likely still pay for the ‘privilege’ of being in poorly performing funds.

It’s long been a criticism of retail fund managers that they levy an annual management charge (AMC) even if their funds perform badly. This AMC is typically

a fixed percentage (usually between 0.75 per cent and 1.0 per cent) of their assets under management (AUM).

In some cases, funds even charge ‘outperformance’ fees on top of the AMC, the rationale being that so long as the fund manager’s hard work results in their outperforming their benchmark, they deserve such a payment. For hedge fund investors, this is a typical model – a two per cent AMC and a 20 per cent performance fee are quite normal.

However, this can result in investors paying an ‘outperformance’ fee despite the fund having lost them money. For example, investors in Fidelity’s China Special Situations Trust had to pay performance fees despite the share price having fallen, as its losses weren’t as bad as those of its benchmark, the MSCI China Index.

This is because Fidelity is entitled to 15 per cent of any change in the trust’s net asset value (NAV) that is more than two per cent above returns from its benchmark – capped at one per cent of NAV. Such a payment is expected on top of the base

management fee of one per cent of NAV.Such actions will revive the debate over

fund performance fees. Indeed, canny investors are already wary of fund costs, as Sandy Forbes, a member of the UK Shareholders Association and a private investor, notes. “The majority of funds’ management charges are way too high,” he says. “So much so that they don’t reflect the skills of the manager’s investment selections but they do instead reflect ‘the going rate’.”

STRIKING A BALANCEAMC fees have come under strong criticism from some academic quarters. In its report Heads you win, tails we lose, Cass Business School showed a fixed fee was generally the best structure for the fund manager and the worst for the investor.

Professor Andrew Clare at Cass explains: “What these fund managers want is an annuity, which doesn’t fall. Or at least doesn’t fall very much. If managers are as good as their word, they should be putting their own money where their mouth is.

“They tell us they beat the benchmark

Who should pay for Investors are increasingly unhappy that they still have to pay charges for funds that are falling in value. But what’s the alternative, if there is one at all?


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every year, and all this sort of stuff, and yet they aren’t willing to take the risk that they might actually lose money alongside their investors.”

Clare is strongly in favour of symmetric fees, where the fund manager receives a share of the profits when the fund outperforms, but also bears some pain when it does badly.

At the time of writing, only three funds in the UK appeared to offer this – Neil Woodford’s Patient Capital Trust and two from Orbis Access. The Woodford fund doesn’t have an annual management fee, but has ongoing annual expenses capped at 0.2 per cent of total assets – it receives a performance fee of 15 per cent only if it delivers a cumulative annual return on NAV in excess of 10 per cent. In addition, the trust must beat the previous peak in NAV before the performance fee kicks in.

It’s a demanding target. Still, as it’s an investment trust whose share price can differ from the value of the underlying assets per share, it’s theoretically possible that Woodford can earn a performance fee

for a period in which the share price fell.Orbis’s two funds, Global Equity

and Global Balanced, only charge performance-based fees if the fund outperforms its benchmark. If it does, it goes halves, taking 50 per cent of that outperformance. If it fails to beat the benchmark it refunds half the difference to its investors.

STICK OR TWISTThe Investment Association is the trade body representing UK investment managers who cumulatively manage more than £5.5trn of client money. Most of their funds charge a fixed fee as a proportion of AUM. A spokesperson argues that a move to symmetric fees might make it hard for funds to withstand years of underperformance.

He says: “Investment managers don’t frequently offer structures that include no AUM-based annual charge element, but if a firm was able to make such a structure work for their clients, then that would be commendable.”

Who should pay for


Finance

He also states that investors are free to move their money out of underperforming funds, so rewards (based on AUM) do eventually relate to performance.

It’s an argument that doesn’t carry much weight with Professor Clare. He points out that, in practice, retail investors are slow to pull out from underperforming funds. He wants to see more funds offering symmetric fees. “It doesn’t have to be excruciatingly painful for the fund manager – they could step it. Maybe the pain isn’t completely shared, as with Orbis, but partially shared; so instead of taking 50 per cent of the downside, they take only 30 per cent.”

Dr Peter Westaway, Head of Vanguard Asset Management’s Investment Strategy Group in Europe, also believes low-cost funds outperform. “Our analysis reaffirms previous academic studies by Vanguard and others that low-cost funds have tended to perform better than high-cost funds over time,” he says. “Consequently, it’s important that investors pay attention to costs because in the world of investing, you don’t always get what you pay for.”

Kay Ingram, a Divisional Director at independent financial adviser LEBC, isn’t convinced symmetric fees would help investors. “The funds still need managing, whether they make money or not, and if fund management houses only benefit from gains it could lead to bigger risks being taken to benefit them on the upside,” she says.

“The charges levied for UK retail funds accessed via the intermediary market have fallen substantially since the retail distribution review in 2013. Competition and an active intermediary market should help keep charges down – it’s something we consider when selecting funds – but it’s important not to confuse cost and value.”

Clearly, funds charging only for performance and offering to share investor pain face obstacles. However, if they can deliver good returns they’re sure to increase in popularity and prosper alongside their investors. n

CHRIS MENON is a freelance investment writer.This article was written prior to the UK’s referendum on the EU.

THE FEES YOU PAY

Aside from possible performance fees, there are a range of standard fees you can pay that will affect returns:

Annual management charge (AMC) This is typically made up of a number of different costs and averages to around 0.75 per cent in most actively managed funds. However, if you buy through a platform, you can often get a reduced AMC. Major platforms such as Standard Life and Hargreaves Lansdown have negotiated special AMCs for their clients, which can be 0.1 per cent or more off the standard 0.75 per cent.

Ongoing charge figure (OCF) This includes the AMC, as well as a number of additional costs such as trustee and auditor fees, which are taken directly out of the fund. These extra charges can add 0.1 per cent on top of the AMC.

Transaction costs The transactions that fund managers undertake within their funds – buying and selling different assets – incur costs such as trading fees, commissions and stamp duty reserve tax (on UK shares). This can add 1.5 per cent to 1.8 per cent, taking total charges to between 2.5 per cent and three per cent.

Entry charge/initial charge This is the maximum charged before investing in certain funds or unit classes. However, if you buy via a platform, you can often avoid this or get a discount — although you may have to pay a small platform fee.

Platform fee These vary quite a lot but platforms tend to charge less and less when their clients' portfolios get bigger and bigger. A fee of 0.25 per cent is still standard in some cases – for example, with Charles Stanley – but others charge a flat fee per transaction.

Annual management charges have come under strong criticism from some academic quarters

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Recognised by numerous leading publications and industry bodies including WealthBriefing’s European Awards - Women in Wealth Management 2016, Farah tells us a little more about the secret of her success.

Q. What is the best piece of advice that has been given to you?

A. It is not really advice, but I think that the best guide by which to live is to treat others as you wish to be treated.

Q. What motivates you?

A. I am a fairly driven person and success motivates me. I love being part of a large, ambitious team which is focussed on growing our business.

Q. How would you describe your working style?

A. I am very people-oriented and enjoy working as part of a team and collaborating with others to achieve a common goal.

Q. What professional achievement are you most proud of?

A. The Estera team and all that we have accomplished. Many of us have worked together for more than 14 years. This longevity and commitment is reflected in many of our client relationships.

Q. Do you have any tips for achieving a good work-life balance?

A. I wish that someone could give me a few tips on how to achieve a good work-life balance! Seriously, I feel very lucky to live in Jersey where it is possible to combine having a good career with an excellent environment in which to raise a family.

During his 30 years in the finance industry, Richard has worked with clients around the world. He shares some of this experience with us.

Q. Where are the majority of your clients based?

A. We have always had a global client base. Most HNWIs and families are international in their reach and outlook, and are much less focused on a single jurisdiction.

Q. Where do you think future demand for wealth structuring will come from?

A. With increasing instability around the world, clients are looking for stable and well regulated jurisdictions in which to place their structures. The demand comes from across the globe, but there is probably more interest from Asia and the Middle East.

Q. What do you enjoy the most about being part of a global business?

A. Being able to offer a number of jurisdictional options means we can be genuinely agnostic and focus on what is in our clients’ best interests, including multi-jurisdictional structures. Interacting with our offices and teams around the world gives us a genuine insight into these jurisdictions and means we can advise our clients from a position of knowledge.

Q. What is the most memorable city you have visited?

A. I have been lucky enough to visit many wonderful cities, but my favourites are Seville and Paris.

Patrick practiced law, working in London and Paris, before moving into the finance industry in Jersey. He explains why he made the move and why he is excited about the future.

Q. What prompted you to move from practicing law in London to the finance industry and ultimately Estera?

A. The commute! With two children and a third on the way, working between London and Paris was glamorous but hardly conducive to family life (or so my wife told me!). Whilst it was a lifestyle decision, I was pleasantly surprised by both the quality of life and the great quality of work available in Jersey.

Q. What sets Estera apart from its competitors?

A. We share a common commitment to service excellence – we have great clients and there is real pride in working with them to deliver the highest quality of service. This, combined with the professional and forward-thinking environment in which we work and an ethos of mutual support and collaboration is what, I believe, differentiates us.

Q. What do you see as the greatest opportunities for the finance industry?

A. Speaking from a Jersey perspective, the finance industry’s credibility is regularly recognised through reports and awards – in this regard, I think we have much to thank our regulators for. The recent Moneyval report, for example, highlights Jersey’s position as a leading jurisdiction in the fight against money laundering and the financing of terrorism. As an international finance centre that competes on a global stage, this is not just something to be very proud of, but something which also presents real opportunities.

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Opinion

In Dexter Flynn, English Solicitor at Voisin law, rails against political

correctness and what he believes to be Jersey’s ‘nanny state legislation’,

including its discrimination law

I’M GOING TO start off with a question I suspect has never been asked: what do Simon Cowell and Jacques Barzun have in common? For the uninitiated, Cowell is a popular music/TV impresario who wears high-waisted slacks; Barzun was a French-born American historian, famous for his commentaries on ideas and culture. The one thing they have in common is their fundamental dislike of political correctness. Cowell “loathes” it. Barzun beautifully claimed that “political correctness does not legislate tolerance; it only organises hatred”.

Just look at the millennial forums Twitter and Facebook – these are modern-day Roman colosseums. One only has to publish something deemed slightly inappropriate by the PC generals, and the perpetrator is immediately slain.

Freedom of speech and thought is being eroded by all those who’ve enlisted in the PC army. Questioning why your Chief Minister (unlike most other world leaders) saw fit to attend migrant camps means that you are, at best, a fascist. And the PC brigade is charged with bringing you down.

Saying that you don’t want the unfortunate migrants of the Middle East to be housed in Jersey (because there are far more appropriate solutions) places you in the pantheon of evil gods to be destroyed by the PC battalions.

Modern language terms such as ‘tax haven’, ‘tax avoidance’, ‘offshore financial centres’ and ‘trust structures’ are becoming culturally offensive. And let’s not talk about WC signs.

It is such political correctness and its enforcement, in one form or another, that acts as a straitjacket upon society. One such example is Jersey’s nanny state legislation. We are an island of 100,000 people.

Illustration: Marthinus Slabber

Notwithstanding my advancing years as a Generation X-er and my recognised wisdom(!), our government sees it as only fit and proper that it should legislate as to when and what I can shop for on a Sunday; control my supermarket booze purchases; tax my sugar consumption; and tell me that gambling in casinos is abhorrent, despite there being numerous betting shops on the island (as well as internet betting).

Really? Has it not got more important issues to address other than Dexter’s drinking, gambling and shopping habits? And don’t even touch upon my greatest sin of all… smoking.

A good example of such legislation as promoted by the PC infantry is Jersey’s discrimination law. Unlike almost any other piece of legislation, if you speak out against this law you must be racist, sexist and, come September, ageist.

Leaving aside the nonsense propaganda about our international obligations, one of the reasons for introducing age discrimination is the fact that in 2012, nine per cent of those asked in a study reported being discriminated against on the grounds of age. Yes, a characteristic being added to

a law on the basis of a four-year-old study and a small minority of the population.

The reality is that most normal humans are anti-discrimination. The millennials, in particular, are very much alive to these important social issues. Therefore, why should we waste hundreds of thousands of pounds on legislation telling us not to be racist, sexist and now ageist, when that money could be better spent elsewhere? Here’s an idea – distribute that money among our pensioners.

And just what are we getting in return for our livre? Since the law

was introduced back in 2014, there have only been a handful of discrimination cases, in respect of race and sex. Does this not merely confirm the fact that overall we are quite a nice bunch of people?

A small community such as Jersey has a much better chance of policing itself compared with the UK (from where we draw this type of legislation). To be frank, our small community functions in part on gossip, rumour and general curtain-twitching. Oh yes it does. Perhaps a local’s racist, sexist and ageist behaviour is more likely to become a topic for debate at a Jersey dinner party given our 0.6 degrees of separation. Oh, the embarrassment of it. Surely this is a more effective deterrent, not a law that very few members of the general public have ever read or utilised.

I therefore declare my allegiance to my PC-loathing brethren, such as Cowell and Barzun, and invite our government to concentrate its fire power on dealing with real issues and not just pandering to the PC calvary who charge about causing havoc and mayhem for no real gain other than self-aggrandisement.

Then again, perhaps this rant is simply a sign of my age! n

myopinion…

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© 2016 PricewaterhouseCoopers CI LLP. All rights reserved. “PricewaterhouseCoopers” and “PwC” refer to the Channel Island firm of PricewaterhouseCoopers CI LLP, which is a member firm of PricewaterhouseCoopers International Limited, each member firm of which is a separate legal entity. PricewaterhouseCoopers CI LLP, a limited liability partnership registered in England with registered number OC309347, provides assurance, advisory and tax services. The registered office is 1 Embankment Place, London WC2N 6RH and its principal place of business is 37 Esplanade, St. Helier, Jersey JE1 4XA.

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Business

Anyone can claim to know all that there is to know about their chosen field – but just because you say you’re an expert doesn’t mean that you areIT’S AN INDISPUTABLE truth that if you want to be ‘found’ – whether that’s getting your or your company’s content noticed, or your CV discovered when looking for a job – the path to doing so is the internet. It’s a simple fact of the world we live in.

But consider this. Whereas in 1991 there was just a single website (the World Wide Web project), last year there were 863 million of the things. That crowded marketplace may help explain why we’re living in an age when every man and his dog calls themselves ‘thought leader’, ‘best-selling author’ or, more cringeworthy, ‘guru’ to get noticed. It also explains how everyone seems to be writing articles, posting blogs, running their own podcasts, and myriad other things in order to make themselves stand out from the pack.

It’s very easy to claim you’re an expert or leader in your field, but a lot harder to be seen as one by the people who matter – your peers and potential clients. So how do you go about becoming a recognised expert rather than a self-appointed one?

GAINING VISIBILITYOne man who knows a thing or two about helping people become experts is Lee Frederiksen, CEO of brand and marketing agency Hinge and author of The Visible Expert. Hinge recently worked with a consultant who places board members and CEOs within private equity firms, but who had struggled for years to get in front of certain decision-makers.

After Hinge helped him understand how best to enhance his ‘visibility’, the consultant spoke at a private equity conference, where he presented rigorously researched findings to the delegates about executive compensation.

He was almost knocked over at the end by the number of clamouring managing partners who wanted a copy of his study and to make appointments to talk further.

According to Frederiksen, Hinge found that the top selection criteria for most professional services prospects was expertise. And it’s identified a formula, if not a ‘science’, behind this.

The agency’s research discovered big differences between what it calls ‘Industry Rock Stars’ (nationally recognised names within a specialist niche), ‘Superstars’ (whose names alone have decision-makers reaching for their cheque books, regardless of what they talk about) and ‘Resident

▼

Words: Dr Liz Alexander

Experts’ who are known within their business but not outside.

The ‘Star’ experts had earned a reputation for deeply researched insights in a narrowly focused area of expertise, as opposed to simply spouting opinion. They were skilled at making complicated topics simple for laypeople, their approach was more about teaching than selling, and they cast a wide net by using white papers, articles, live conference presentations, webinars and especially books to communicate their message. They were the ones for whom buyers would pay firms seven to 13 times more for their services.

Hinge’s most recent study found that being a visible expert ‘plays the single most significant role in driving referrals’ leading to new business.

“When we looked deeper at the research, we saw these weren’t referrals from previous clients or people known to these experts, but from individuals in the marketplace who’d heard of their reputation,” Frederiksen explains. “This level of visibility and credibility shows the value of spending time in business development and marketing.”

Given this research, wouldn’t it make sense that a company could raise its profile by raising the visibility of key individuals? Well, maybe not.

Rachel Ainsworth has found that few firms are willing to allow their experts to be personally recognised and promoted this way, fearing they will be poached by the competition or go out on their own. Ainsworth is Head of Thought Leadership Strategies and Solutions at Source Global Research, a London-based firm that analyses thousands of


Business

an expert an expert?

What makes


Business

pieces of content put out by consulting firms every year in order to identify what works (and what doesn’t).

“I strongly believe this is less of a risk than it appears,” she says. “It’s actually quite difficult for good people who know their stuff to find a firm that will allow them to be visible, which is why they’re more likely to stay.”

She recently interviewed William Eggers, Director of Public Sector Research at Deloitte, who pointed to the 13-year investment made between him and his employer. He could take all his institutional knowledge and client connections with him if he left the firm, but then he’d have to leave behind all the IP collateral developed while working there. This led Ainsworth to conclude that if there’s sufficient support from a firm in helping their experts build influence, they’re less likely to go elsewhere.

RECRUITING AND RETAINING Developing experts who are publicly visible isn’t just a retention tool, adds Shelley Kendrick, Managing Director of Jersey executive recruitment consultancy Kendrick Rose, it’s invaluable for recruiting good people. “Having well respected and trusted advisers associated with your brand doesn’t just enhance the reputation of the business and, through that, increase revenue,” she says. “It shows it’s a great place to work for professional development. All businesses should promote their good people, in the sense of allowing them to put their names on key pieces of content.”

University of Toronto researchers Carl Bereiter and Marlene Scardamalia asked the question ‘Who is an expert?’ in their book Surpassing Ourselves: An inquiry into the nature and implications of expertise.

They offered this answer: the difference between experts and ‘experienced non-experts’ is that experts ‘turn a predicament into a problem, which they then help solve’ by rising to the upper limits of their ability. However, experienced non-experts ‘merely carry out practised routines’ or offer standard courses of action.

In the case of Abakar Saidov, CEO of recruitment software firm Beamery, however, it also seems to be that ‘expertise’, like beauty, is in the eye of the beholder.

Saidov is a former Goldman Sachs analyst and private equity fund associate, who left financial services to build an innovative platform for recruiters. His idea was that Beamery would target and attract the right people and provide an inbound recruitment platform so that clients could convert passive candidates into active job applicants.

This apparently left the Silicon Valley venture capitalists he’d targeted for funding puzzled. It seems they couldn’t get their heads around how someone who wasn’t a software engineer from Stanford and didn’t have a background in HR management systems could claim to be an expert on recruitment.

But like Bereiter and Scardamalia, Saidov believes: “You don’t become an expert just by accomplishing a task, you become one by constantly questioning whether you could be better at that task in order to improve it.”

And it’s for that reason – not least saying something different to the usual ‘yada yada’ and producing real results on their behalf – that Beamery’s clients consider Saidov and his team to be experts, he says.

Bottom line? While it may no longer require 10,000 hours, a wall full of certificates or even formal qualifications to be considered an expert in some fields, for clients and prospects to take that accolade seriously enough to throw money your way, you need to be visible and valuable enough so that third parties are continually talking you up. n

Dr Liz Alexander is an author, educator and business strategist, and Founder of business consultancy Leading Thought

THE ‘CURSE’ OF EXPERTISEExperts aren’t always all they’re cracked up to be. They often offer inaccurate predictions and faulty judgments and make decisions no better than novices.

According to AOL Co-Founder Steve Case in The Third Wave: An Entrepreneur’s Vision of the Future, in the early 2000s former Time Inc CEO Don Logan was “someone who didn’t believe the internet had much of a future”.

Investor research firm CXO Advisory Group analysed the forecasts of stock market experts from 2005 to 2012 and found accuracy to be ‘worse than the proverbial flip of a coin, just under 47 per cent’. One security investment analyst claiming to be ‘truly a living legend’ had a forecasting accuracy score of 50 per cent. One wag reporting on behalf of CBS Moneywatch said: “The only value of gurus is to make weathermen look good.”

So why are we so inclined to believe them? Researchers Carl Bereiter and Marlene Scardamalia suggest the term ‘expert’ is closely linked with occupational status, encouraging notions of elitism, professionalism, ‘maleness’ or authority. That is, we see what we expect to see.

This might explain why former police Superintendent Mike Martin enjoyed a 26-year career despite ‘exaggerating and fabricating his work achievements’, including a forged university degree.

Or how ‘world-renowned’ thoracic surgeon Dr Paolo Macchiarini ‘misrepresented his professional history’ and duped award-winning producer Benita Alexander, who was making an NBC News special about his work, into believing they’d marry. He told her he’d arranged for the Pope to officiate at their Rome ceremony, and that Vladimir Putin, the Obamas and the Clintons would be attending.

When asked why she believed everything he told her (he’d actually been married for 30 years, and still was), Alexander said: “This was a renowned, accomplished, established surgeon.”

You don’t become an expert just by accomplishing a task, you become one by constantly questioning whether you could be better at that task


Business

Would you ever say stop? Enough experiences… and settle for less? Not you. You want more. You believe in getting more out of life...

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Business

10 signs an employee is ready to become

a manager

Promoting from within is good business practice, but which team members are actually management material?

CHANCES ARE, THERE are a few great leaders on your team who aren’t yet in managerial positions. Some may already take on the role of a manager without claiming the title, while others may show subtle signs that they’ve got what it takes to lead. Just as the wrong hire is costly, so is the wrong promotion. Here are 10 traits that the Young Entrepreneur Council regards as sure-fire signs that a team member is ready to take on a managerial role.

1. THEY CHANGE THEIR VOCABULARY FROM ‘MINE’ TO ‘OURS’Going from employee to manager occurs when a team member hits a tipping point. It’s normally when they begin to understand a manager’s point of view. Look for subtle changes in conduct, including a simple choice of words. An employee may use ‘I’, ‘mine’ or ‘me’, but those ready to assume a management role may choose ‘ours’, ‘we’ or ‘us’.

2. THEY PROVE THAT THEY CAN MANAGE THEMSELVESAn employee has come into their own when they require less and less time to manage. They know what needs to be done and make sure it happens. Someone can only hope to be a manager if they can manage themselves.

3. THEY LOOK OUT FOR OTHERSIf an employee is concerned about their co-workers’ success as much as their own on a group project, that’s a good sign that you have a team player. Great managers are selfless leaders who want a group to succeed together.

4. THEY HELP OTHERSIf you see team members going to a certain person with questions, that’s a clue. If that person has the answer, or promises to find

the answer, they may be ready to move up to management. The definition of a good manager is someone who helps others and still accomplishes their own job.

5. THEY EXCEL BEYOND EXPECTATIONSA good leader will consistently go above and beyond. When you see them leading others in all their work – when they exceed expectations in everything they do – it’s time to promote them. You don’t want to lose them to someone else who is willing to give them that promotion when you’re not.

6. THEY ALREADY MANAGE WITHOUT REALISING ITWhen a staff member is ready to take on a managerial role, they’ve often done so without realising it – helping other staff with marketing plans, advising on how to deal with difficult clients or making a new intern feel welcome. When somebody truly wants to be in that role, they do it without even trying because they enjoy it.

7. THEY SHOW INGENUITYA great manager is someone who not only

manages existing tasks, but also takes the initiative in creating or improving other

tasks and processes for the benefit of the company. Potential managers who demonstrate these traits also tend to display ingenuity and critical thinking in the ways they perform on a daily basis, which means they are ready to take on more responsibilities.

8. THEY SHOW OWNERSHIPOne positive sign is that the

employee regularly shows a feeling of pride and ownership in their

work. Leading a team is about understanding the big picture and

recognising not only what it will take to get there, but understanding how the assets available to you can help you create that picture. Employees who approach every task as if its success or failure is a direct reflection on them are on track.

9. THEY VOLUNTEER FOR LEADERSHIP ROLESA team member who takes a leadership role – whether it’s in a team project context or in another environment – is likely to be ready for a management role. These situations present themselves often, and those who take the bull by the horns are the ones who are ready for the next step.

10. THEY’RE PROACTIVEThere’s something to be said when a team member jumpstarts their workload without you having to instruct them further. Team members who proactively ask questions to improve their output within the company are ready to move up in it. n

This article, written by the Young Entrepreneur Council, originally appeared on Inc.com.

“They make a big deal out of promoting someone

around here”


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Business

Here’s what we learned recently…We all get bombarded with emails and information on a daily basis but, amid all the guff, you sometimes find nuggets of wisdom and pearls of downright weirdness. Here’s what’s caught BL’s attention since our last issue

THERE’S ONLY ONE QUESTION YOU SHOULD ASK YOUR INTERVIEWERThe only question you can guarantee an interviewer will ask you is: “Do you have any questions for me?” Cue your chance to show what a smart, insightful individual you are, and why they’d be foolish not to snap you up for a vast salary.

According to Executive Coach and Consultant Jenny Williams in a recent LinkedIn post, when given this opportunity, it can be helpful to ask:● What do you enjoy most about working here?● What qualities do the most successful people here have?● How would you define success for me in the first six months to a year in this role?● Who previously held this position and what are they doing now?

The one question Williams gets all her clients to ask at an interview is: “From our conversation, do you have any concerns about my fitness for this role and this organisation?”

She says this works well because:● It gives you the opportunity to address any concerns that the interviewer may have● It forces the interviewer to review your interview performance and, in their mind, say yes to you. This is particularly helpful when you’re up against a number of candidates● It demonstrates leadership, showing that you’re proactive and not afraid to have tricky conversations● It also helps unearth the unexpected. One of Williams’ clients found out the interviewer had no concerns about him but had already found a candidate to appoint internally. Whether they should have even interviewed her client is one thing, but Williams says it was helpful to find out there and then, rather than wait for days or weeks.

YOU CAN TAKE A PHOTO ON YOUR IPHONE USING THE VOLUME SWITCHWe do love a bit of tech geekery here at BL – our Editor Nick Kirby is the proud owner of three iPhones, an iPad, iPod touch, iPod Nano, MacBook Air and a MacBook Pro (what, no Apple Watch?!). So we were thrilled to discover that you can take a photo on your iPhone using the volume button!

OK, so we admit that ‘the kids’ with all their

Snapchatting and Instagramming probably knew this already, but to us it was a revelation. No more trying to take the ultimate selfie by holding the phone

and poking at the screen. Just hold your iPhone and open the camera app, press the + volume button on the side of your phone, and kerching!

Apparently, the same trick works for your headphones, too. Just hit the volume up button on the Apple Remote Earphones to snap a pic.

WE FEEL UNDER PRESSURE TO BUY THE RIGHT CLOTHES FOR WORK

If you’ve ever felt you look a little shabby at work, you’re not alone. A recent survey by office stationary supplier Viking reveals that one in 10 workers are unhappy with their workplace attire. What’s more staggering is that 52 per cent of workers said they felt under pressure to buy new clothing to ‘keep up

appearances’ around the office. When asked why, the majority said their fellow colleagues would judge them for not revamping their wardrobe.

When looking at how different offices’ dress codes affected employee morale, the study found a clear link between formal clothing and feeling confident. Seventy per cent of people who wear

business formal clothing feel confident at work. This decreases the more casual a workplace’s

dress code is. Only 55 per cent of those wearing smart-casual attire felt confident at work, falling to 45 per cent with casual clothing and 35 per cent for uniformed workers.

The BL team highly recommends working from home in a onesie to get round this dilemma.

SIX MILLION BRITS HAVE NEVER USED THE NET When we saw this little shocker on The Memo we thought it was April Fool’s Day again. But, unbelievable though it might sound, one in 10 people in Britain have never used the internet, according to a report from the House

of Commons Science and Technology Committee entitled, rather aptly, Digital Skills Crisis. Even more

staggering, the report claims 12.6 million adults also lack skills essential to everyday life – online banking, using a search engine and posting on social media.#youvegottobekidding n

www.blglobal.co.uk July/august 2016 53

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Technology

Upcoming changes to EU legislation on data protection are going to give more power back to individuals. So just what is happening and how might you be affected?

▼

but anyone sharing data across borders will have to look at themselves and ensure that they’re complying with everything in the regulations.”

There’s also a change in reach. The GDPR extends to any organisation anywhere in the world if it’s offering goods or services in the EU, or if it’s capturing personal data on EU citizens – irrespective of whether it has a presence there.

Finally, there are those fines. Failure to adhere to current data legislation would have led to little more than a slap on the wrist. “A fine of four per cent of global turnover could put many companies out of business,” says Vermeulen.

WHY DID THE EU FEEL THE NEED TO BRING IT IN?The existing data protection laws date back to 1995, when mobile phones were still bricks and Facebook’s Mark Zuckerberg was only 11. These days your bank details will fly around the world faster than you can say AltaVista, so the law is simply catching up with the seismic shifts we’ve seen in the tech.

As Sara Johns, who leads Ogier’s digital, tech and IP services, explains: “With data now flowing across boundaries in the digital economy, it’s about simplifying and harmonising the regulatory environment and giving individuals more control, and more protection, over their personal data, thus keeping pace with the way we do business in 2016.”

Yet the digital world still has barriers, and differences in the implementation of laws have made things uncertain and expensive for businesses. The new package harmonises the approach across the continent, creating a Single Digital Marketplace where everyone can sell easily to everyone else.

Finally, it may even be a statement of principle. “There’s also a major dichotomy between what the EU is doing and what happens in the US, where customer data is seen as an overwhelming asset,” says Mark Dunster, a Partner specialising in litigation, compliance and financial regulatory matters at Carey Olsen. “Google’s CEO recently warned people that they already have no online privacy – and to ‘get over it’. This legislation may well be the EU’s way of saying: ‘We disagree with you’.”

Words: Dave Waller

DATA PROTECTION HAS long been seen as a poor relation in regulatory circles – but that’s about to change. After many years of political negotiations, the EU finally agreed the wording of the General Data Protection Regulation (GDPR) in December 2015.

This radical new legislation will have an impact on every entity that holds or uses European personal data, both inside and outside of Europe, with a profound effect on how such information is obtained, handled and disposed of.

And although it’s not due to come in until May 2018, its force will be felt far sooner than that.

SO WHAT DOES THE NEW LAW ENTAIL? Everything hinges on the idea that the end user owns their data. The law strengthens the individual’s right to be forgotten, requires greater consent before a business can use customer data for direct marketing, and makes data portability more easy – so if a customer wishes to shift bank accounts, for example, existing standing orders and direct debits can move with them.

The regulation also gives stronger rights to governments to dictate how businesses of all sizes store and share people’s information. Companies will have to disclose issues such as data breaches, should they occur, while public bodies and large private sector organisations may well be required to appoint qualified data protection officers.

But the real attention grabber is the massive fines that will face any company that falls foul of the new standards – up to €20 million, or four per cent of the company’s global turnover, whichever is greater. Ouch.

HOW IS THAT DIFFERENT TO NOW? Under existing data regulations, a company based in one jurisdiction can easily transfer data to any other jurisdiction that’s deemed equivalent. But the responsibility for compliance will now lie with the individual company too.

“It’s a sea-change that takes it to a whole new level,” says Nick Vermeulen, Partner at PwC in the Channel Islands. “Not only will the jurisdictions need to be aware of what’s happening,


Technology

Smart Graduates Wanted.

As a locally owned organisation with our main market focus on the Channel Islands, we feel it is important to recognise the potential of local talent.

To infuse our staff with a sense of purpose and meaning, there are five main principles and standards that drive us every day:

1. Having an original approach to problem-solving through innovative thinking

2. Collaborating with colleagues by sharing our ideas and knowledge and examining their wider impact

3. Adopting an entrepreneurial outlook, so good ideas can be transformed into commercial innovations

4. Instilling a positive energy and optimism in everything we do

5. Focusing on the impact we have on the lives of those around us, so we can change things for the better

These values motivate us to produce work that truly makes a difference to the lives of our staff, our clients and our communities. By joining C5, you can become part of the difference that we make to the lives of everybody we work with across the Channel Islands.

To learn more about careers at C5, visit www.c5alliance.com/careers or email us at [email protected]

C5 prides itself on the learning and development opportunities that we offer our staff and the in-house training we provide.

Businesses will have to do a lot more to keep data in good order, to make sure it’s accurate and that they can remove it if asked to

DON’T ALL BUSINESSES HANDLE DATA THESE DAYS? WHO’S GOING TO BE AFFECTED?Any business in any industry dealing with people in the EU – from fund managers and e-gaming companies to Specsavers – will be affected. The good news is that it should enable companies to sell their goods across the whole marketplace. The bad news? They’ll need to get their house in order.

“Businesses will have to do a lot more to keep data in good order, to make sure it’s accurate and that they can remove it if asked to,” says Robert Le Corre, Jersey branch Chair of the ICSA and Company Secretary at Moore Stephens. “There’s an awful lot more burden on their part. And you can’t ignore it – if you’re holding data that relates to an EU citizen, you will have to comply.”

Companies will need to look at their policy and procedures to ensure that they can deal with breaches and meet the enhanced standards, and establish a framework of accountability. “We will increasingly see data protection on board agendas, if it wasn’t there already,” says Johns. “And it may require additional expenditure in order to comply.”

WHAT ABOUT INDIVIDUALS? WILL WE BE MORE PROTECTED OR WILL OUR DATA BE OUT THERE?“Your data is already out there, frankly,” says Johns. “But this regulation will give people more control and more access to their data, so it’s a real step forward.”

Indeed, the regulations should herald a whole range of new protections. Consent will need to be specific, unambiguous and retractable. The regulation has also enshrined the right to be forgotten, and individuals will be able to request to see their data, demand it’s erased or restrict its use.

Vermeulen posits the example of an insurance company that monitors how each driver drives and uses the data to calculate premiums. “I’ll know they can only hold that data for, say, 30 days while they give me a quote,” he says. “If I reject the quote, they lose the data under my right to be forgotten. But if I agree to continue to have them writing my policy, it allows them to monitor my driving style every day.”

HOW WILL THE CHANNEL ISLANDS BE AFFECTED, SPECIFICALLY?The regulation applies to anyone outside the EU wanting to offer goods and services to those within the EU, so many businesses in the Channel Islands will have to ensure their processes are up to scratch before the law takes effect in 2018.

But the islands are also developing their own data protection legislation to keep step with the EU, and many have spotted a potential opportunity here. With the right level of flexibility, that legislation could help the islands attract fintech companies and other businesses looking to deal in data securely.

“The Channel Islands have the largest number of non-UK-based holding companies listed in London, and we think there’s an opportunity for the islands to be a location for anyone looking to list in London in the data space,” says Vermeulen.

“We could write the regulation and guidelines that say you need to do x, y, z to comply. This should be attractive to people who want to be sure they’re on the right side of the regulator.”

ANY FINAL THOUGHTS? There is, of course, plenty of speculation as to whether the Channel Islands have everything to lose here or everything to gain. The facts are that the law is a necessary move to protect the rights of people in the digital era, and that while it may yet be a couple of years from being introduced, businesses will have to act now to ensure that they’re ready. “Data protection has come of age,” says Johns. “Ignoring it is not an option.” n

DAVE WALLER is a freelance business writer

WILL BREXIT HAVE AN IMPACT?

While the EU’s General Data Protection Regulation (GDPR) is scheduled to come into force on 25 May 2018, uncertainty around how the UK will exit the EU brings into question whether or for how long the regulation will directly apply in the UK.

Data protection law specialist Marc Dautlich of Pinsent Masons says that the UK’s data protection laws will remain unchanged in the short term and that the GDPR will apply directly in the UK unless the UK government takes specific action in the area of data protection prior to the regulation coming into force.

In a statement, a spokesperson for the Information Commissioner’s Office (ICO) in the UK confirmed that the Data Protection Act 1998 ‘remains the law of the land’ at the moment. It said that UK data protection reforms are ‘necessary’ and that the data protection framework in the UK would need to accord to the standards outlined in the GDPR if the UK wishes to ‘trade with the [EU] single market on equal terms’ in the event that the regulation does not ‘directly apply to the UK’.

The ICO spokesperson said: “If the UK is not part of the EU, then upcoming EU reforms to data protection law would not directly apply to the UK. But if the UK wants to trade with the single market on equal terms, we would have to prove ‘adequacy’ – in other words, UK data protection standards would have to be equivalent to the EU’s General Data Protection Regulation framework starting in 2018.”


Technology

Smart Graduates Wanted.

As a locally owned organisation with our main market focus on the Channel Islands, we feel it is important to recognise the potential of local talent.

To infuse our staff with a sense of purpose and meaning, there are five main principles and standards that drive us every day:

1. Having an original approach to problem-solving through innovative thinking

2. Collaborating with colleagues by sharing our ideas and knowledge and examining their wider impact

3. Adopting an entrepreneurial outlook, so good ideas can be transformed into commercial innovations

4. Instilling a positive energy and optimism in everything we do

5. Focusing on the impact we have on the lives of those around us, so we can change things for the better

These values motivate us to produce work that truly makes a difference to the lives of our staff, our clients and our communities. By joining C5, you can become part of the difference that we make to the lives of everybody we work with across the Channel Islands.

To learn more about careers at C5, visit www.c5alliance.com/careers or email us at [email protected]

C5 prides itself on the learning and development opportunities that we offer our staff and the in-house training we provide.


Maternity rights take a step forward

A long-anticipated change in Guernsey’s employment law came into force on 1 April 2016 in the shape of the

Maternity Leave and Adoption Leave (Guernsey) Ordinance, 2016, which provides, subject to certain conditions, up to 26 weeks’ leave to employees who have given birth to or adopted a child. In the main, it applies to employees whose due date (in respect of births) or expected placement date (in respect of adoptions) is on or after 7 August 2016.

Prior to the Ordinance, most Guernsey employers will have provided some sort of parental leave for employees under their contracts of employment. Until now, however, nothing compelled them to do so. The Ordinance sets out the minimum requirements that employers must comply with. Although it only deals with leave, not pay, it is expected that pay provisions will come in early next year.

For now, employees will have to rely on

BLguernsey

Employees look set to benefit from new laws brought in to help natural and adoptive parents. But as Leslie Martin, Associate at Mourant Ozannes, explains, it’s just the first step on the road ahead

their contractual maternity/adoption pay provisions (if they have them).

Men and women may adopt (any references to the feminine in respect of adoptions in this article also apply to the masculine) and for the purposes of the Ordinance, an employee adopts a child if that child is aged 17 years or younger.

Some have queried whether 26 weeks is necessary in respect of a 15-year-old, but we assume that the reasoning behind this was to ensure bonding between adoptive parent and child.

Maternity/adoption leave is only available to the mother/main adopter and it isn’t possible, as it is in other jurisdictions, to share the leave with a partner. This perhaps shows Guernsey has stuck to the traditional approach to childrearing, at least for the first six months of the child’s life/adoption.

Employees who give birth or adopt mustn’t work within the first two weeks of

doing so – known as Compulsory Leave. In fact, an employer who permits an employee to work during Compulsory Leave commits a criminal offence and is liable to a fine (£1,000 in respect of adoption and a hefty £10,000 in respect of childbirth).

This may seem a little steep, but the States has decided that it is the level of ‘stick’ required to stop this happening.

Subject to certain conditions – including that the employee must have been continuously employed for no less than 15 months at the start of the 11th week before the due date/expected placement date – two weeks’ support leave is available to employees who are the spouse, cohabitee or person nominated in writing by the mother/main adopter.

In this respect, Guernsey has opted for a modern approach, taking into account that not all women who give birth or adopt a child necessarily have a partner. The mother/main adopter may nominate a grandparent to help look after the child.

Time off during working hours for ante-natal care is also available to women where it is on the advice of a medical professional. The fact that the appointments must be on the advice of a medical professional and that an employer may request evidence of such appointments (except in respect of the first appointment) has been built in to prevent abuse of this provision.

There is, however, no restriction on the number of such appointments an employee may take. This will benefit women who have more difficult pregnancies and require additional appointments.

Employees will also have the right to work up to 10 keeping-in-touch (KIT) days during their leave (except Compulsory Leave), during which time they will be paid at their normal rate of pay.

If employers are paying contractual maternity/adoption pay, employers should expect that many employees will choose to work KIT days during periods of leave that the employer is not paying.

The Ordinance will be a big benefit to employees, who will be guaranteed a minimum amount of leave to look after their babies/adopted children.

In some ways, this is a modern approach to parental leave. However, when we compare it to other jurisdictions where parental leave may be shared by the parents, perhaps Guernsey remains behind the curve. Nevertheless, 2016 will be seen as a positive step in the right direction for family-friendly laws being introduced in the island. n


BL Guernsey

Impressive funds growth in Q1

Sweet PR merges with Black Vanilla

The total value of funds business in Guernsey grew by £10.4bn (4.6 per cent) in

the first quarter of the year.Figures from the Guernsey

Financial Services Commission (GFSC) show that at the end of March 2016, the net asset value of all funds under management and administration in the island were £238bn, a rise of £15.8bn (7.1 per cent) on the same point in 2015.

The main reason for the growth was the value of Guernsey closed-ended funds, which increased by £9bn (6.4 per cent) to £149.6bn during the first quarter. This represents an increase of £14.7bn (10.9 per cent) for the year since March 2015.

The Guernsey open-ended funds sector also saw an increase. At the end of March 2016, the sector had increased in value by £1.4bn (3.6 per cent) to £40.4bn during Q1.

This, however, did represent a small decrease of £0.7bn (-1.7 per cent) over the year.

Non-Guernsey schemes – open-ended funds that aren’t domiciled in Guernsey but have some aspect of their management, administration or custody carried out in the island – remained at £48bn for Q1. This represented an increase of £1.8bn (4.6 per cent) over the year.

“The figures mark the third consecutive quarter in which we’ve seen an overall increase in the value of funds under management,” said Guernsey Finance Chief Executive Dominic Wheatley. “Guernsey practitioners are reporting a great deal of interest from promoters and sponsors.

“New schemes launched in the first quarter of 2016 and fourth quarter of 2015 underline the market’s confidence in Guernsey.” n

Marketing and communications agency Black Vanilla has merged with fellow Guernsey firm Sweet PR. Sweet’s clients have been integrated into Black Vanilla and the

agency’s clients will now have access to in-house copywriting services and public relations strategies.

The Founder of Sweet PR, Nichole Culverwell (née Sweetsur), joins Black Vanilla Founder Jade Isabelle as Partner and Director of the merged firm.

Nichole brings 25 years of PR and writing experience to Black Vanilla. She ran her own agency in London before moving to Guernsey five years ago and has overseen campaigns for brands such as Boots, Pfizer and Generali.

The newly merged company plans to develop its team of copywriters, strengthen its event management services and form partnerships with other Channel Islands agencies. n

GFSC releases 2015 annual report and accounts

The Guernsey Financial Services Commission (GFSC) has published its 2015 Annual Report and Financial Statements. Its accounts for 2015, which form part of its Annual Report, show

overall expenditure was £12,196,257, with staff costs down by around £260,000 – a reduction for the second year in succession.

Legal and professional fees also fell significantly compared with 2014. Annual licence fee rises have been pegged at two per cent or less for the past four years, other than in respect of anomalies.

In his Chairman’s Statement, Cees Schrauwers reviewed the GFSC’s progress on its three-year plan, initiated in 2013, which comprises seven goals. Chief among these are enhancing relationships with government and industry, raising the GFSC’s professionalism and performance, and controlling its costs.

Schrauwers said: “We did not underestimate the challenges facing us in 2013. We also recognised recruiting a high-quality Director General would be instrumental in helping us deliver the goals we’d established, including the need to significantly enhance

Nichole Culverwell (left) and Jade Isabelle

our relationships with our stakeholders. The Commission’s Board set itself tough objectives for the period 2013 to 2015 and I’m pleased with the progress. We have decided that now is the right time to review our effectiveness against accepted international standards and we intend to commence that work shortly.”

The Annual Report also sets out the GFSC’s objectives for 2016 and highlights the challenges facing the financial services sector.

Director General William Mason said: “The Commission seeks to engage at international regulatory forums to ensure the views of the bailiwick are taken into consideration… We also look to ensure new international regulatory requirements are implemented in a considered manner after thorough consultation.”

Mason also clarified the GFSC’s approach to enforcement. While action will be taken where the Commission identifies serious wrongdoing, it remains the GFSC’s preference to deal with issues through remedial action overseen by firms’ boards and the GFSC.

The GFSC Annual Report can be viewed at www.gfsc.gg n


All change for Guernsey’s population law

On 2 March 2016, the States of Guernsey approved new legislation which will have

a radical impact on how Guernsey’s population will be shaped in the future. The Population Management (Guernsey) Law, 2016 is set to become law, with a proposed start date of April 2017.

The new law represents an overhaul of the old housing control system. That system was introduced after the war to preserve Guernsey’s housing stock for people coming back to the island and, in simple terms, required anyone who wasn’t ordinarily resident in Guernsey pre-1940 to obtain a licence to occupy a Guernsey dwelling.

Fast forward to Guernsey’s horticultural boom days when short-term licences allowed a huge influx of seasonal workers. In due course, horticulture was replaced by the finance industry, which also needed a steady stream of licences to staff its businesses.

The weaknesses of the housing control system became apparent over the years and it wasn’t equipped (nor was it ever intended) to address the bigger issue of population management.

The new regime is a seismic shift away from controlling housing to managing the island’s population – how

it is made up, what types of employment justify residence and for how long. Gone are ‘licences’, Tax on Real Property (TRP) thresholds and lengthy application forms.

From April 2017, employers can apply for permits for employees coming to work in Guernsey. There are three basic options: long-, medium- and short-term employment permits (LTEP, MTEP and STEP).

An LTEP is issued for up to eight years to address a persistent and enduring skills shortage. It’s similar to the old 15-year essential worker licence and it’s likely that similar justification will need to be shown. An MTEP is issued for up to five years for positions that require specific skills not currently available locally but likely to become available in the future. Finally, a STEP is issued for up to one year, where the role is unskilled but there’s a need for additional workers who can’t be sourced locally.

RESIDENT PERMITSImportantly, under the new regime, anyone who has lived in the local market for eight years continuously will be issued with an established resident permit. This allows the person to stay in Guernsey permanently, provided they live here continuously for 14 years in total. After 14 years, they

The introduction of new rules will make a significant difference to the way population is managed on the island. Elaine Gray, Partner at Carey Olsen, walks us through the main points

will be issued with a permanent resident permit. This entitles them to stay in Guernsey with an automatic right of return after any period of absence.

An important part of the new regime is the new Population Advisory Panel. This will provide independent advice to the Policy and Resources Committee every six months, detailing any skilled and unskilled shortages in the labour force. As a result, it will be possible for policies to be issued identifying the categories of workers for which permits should be granted. This will allow for a much more streamlined application process as the policies will make it clear who will be granted permits.

PRACTICAL ISSUESOther important changes are that an employee has to get their work permit before they come to Guernsey and, once a permit is granted, the employee can change jobs within the same category of work.

Once a permit has expired, the worker must be absent for the duration of that last permit before a return is permitted.

Perhaps the change that’s likely to be welcomed the most by permit holders is the abolition of a TRP threshold – widely condemned as falsely

inflating the property market. There is also provision

allowing family members to stay with permit holders – extending to the spouse, partner, parents, children and grandchildren, but only of LTEP and MTEP holders. Family members of STEP holders have no equivalent rights.

The new legislation also allows for ‘grandfathering’, so that rights accrued under the old regime will generally count towards qualification under the new regime. New documents will be issued as and when old documents come up for renewal.

The new regime also introduces tools to manage the Open Market, which has just under 1,700 private dwellings, hotels, nursing and residential properties and lodging houses. The new regime will allow that sector to be managed for the first time by imposing limits on how long tenants can live and work in Guernsey.

This is the biggest change of one of the key elements of Guernsey’s infrastructure for employers in our lifetime. The focus is now firmly on which workers are needed and for how long. With that as its starting point, Guernsey is definitely heading in the right direction. n

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Guernsey wins international Wealth Adviser Award

states launches SMART Guernsey projectG

uernsey has been named Best International Wealth Management Centre at the Wealth Adviser

Awards 2016 – a title it previously won in 2014.

The awards recognise excellence among wealth managers and service providers from the UK and offshore jurisdictions and encompass a range of categories covering the wealth management space.

The winners were determined by votes from Wealth Adviser readers, including wealth managers, IFAs, fund managers, family offices, law firms, accounting firms and other industry professionals.

Guernsey Finance Chief Executive Dominic Wheatley said: “The award recognises a productive year for us,

including the appointment of our first Middle East representative, our first Director of International Business Development and the launch of our second overseas outpost in Hong Kong.”

Guernsey Finance Chairman Lyndon Trott collected the award from Wealth Adviser Editor Beverly Chandler at a presentation in London (above). n

The States of Guernsey has launched its SMART Guernsey project to develop a Guernsey Economic

Modelling (GEM) system.Developed by local financial modelling

specialist Dorey, GEM will give the States access to economic and demographic forecasts to help it develop understanding and improve decision-making.

Colin Vaudin, Chief Information Officer for the States, said: “GEM will take the huge amount of data we have at our disposal and create a system that will place projections of our demographic and economic future at our fingertips. Having access to forecasts will greatly enhance our ability to make informed decisions.” n

Proposals for register of beneficial ownership

Guernsey’s Policy and Resources Committee has published a consultation paper on setting up a

central register of beneficial ownership of companies.

The issue of beneficial ownership registers has occupied Guernsey since 2013, when Prime Minister David Cameron announced that the UK planned to set up a central register. He urged all three Crown Dependencies and Britain’s Overseas Territories to do the same.

The UK legislation is now in force. Britain’s Crown Dependencies and Overseas Territories (CDOT) have taken steps to cooperate with UK authorities. They have agreed to deliver information on company beneficial ownership to the UK authorities electronically within 24 hours, or within one hour in ‘urgent’ cases.

They all, however, stopped short of making a central registry of beneficial ownership publicly available, as the UK government originally required.

Guernsey’s first consultation paper, on the principle of whether a central registry

should be established at all, was issued in May 2015. On 4 April, Guernsey Chief Minister Jonathan le Tocq wrote to David Cameron promising ‘enhanced timeliness of [UK] access to adequate, accurate and current beneficial ownership information in relation to Guernsey companies [through] a dedicated team to be a point of contact between Guernsey law enforcement authorities and their international counterparts. [...] We will have in place a secure, consolidated and locally accessed register with a designated point of contact.’

He explicitly ruled out a publicly accessible register on security grounds.

The technical details of Guernsey’s plan have now been set out in the consultation document, released on 31 May. Its stated objective is to bring Guernsey in line with international standards on transparency.

Currently, Guernsey only requires beneficial owner information to be collected and lodged by resident agents with the Registrar of Companies and Limited Liability Partnerships. The resident agents also have disclosure powers

exercisable against members, under certain conditions. The information disclosed is available to law enforcement agencies, the Guernsey Financial Services Commission and HM Procureur for specific purposes.

The central register would be established and maintained by a Registrar of Beneficial Ownership and rapidly accessible by Guernsey authorities through unspecified ‘legal gateways’. It isn’t clear whether this will be by direct electronic means. The Guernsey authorities will be able to disclose the information to authorities outside the island for the purposes of investigation, prevention, prosecution of offences, collection of taxes and ‘the carrying out of any functions of any intelligence service’.

The register will not be open to the public, and it will be protected by confidentiality rules and by encryption.

Jersey already operates a similar model, though its information is available only in response to requests from the UK National Crime Agency and related organisations.

The consultation ended on 8 July and responses are being considered. n

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62 july/augusT 2016 www.blglobal.co.uk

This year’s Jersey Institute of Directors (IoD) Annual Debate will discuss whether Jersey’s public and private sectors are adequately prepared to meet the challenges of an increasingly

complex future.The event – entitled Future Proofing Jersey – will explore

whether Jersey has the right leadership, brand, systems and expertise required to steer a safe course and ensure a successful future for local businesses and residents.

Looking at the public and private sectors separately, speakers will suggest how megatrends are likely to shape Jersey’s environment. They will examine the island’s commitment to innovation, internal and external threats, access to and use of resources, competition from other jurisdictions and the impact of international security.

Attendees will also have the opportunity to question the panel of visiting and local experts, under the guidance of moderator and news broadcaster Alastair Stewart.

IoD Jersey Chairman Chris Clark said: “We will aim to get under the skin of the public and private sectors to understand where our strengths are and where we need to improve if we are to ensure our long-term success.”

The Annual Debate will take place on Thursday 15 September at the Royal Jersey Agricultural & Horticultural Society, from 5.45pm to 10.30pm. It is open to IoD members and non-members. Places and tables of 12 can be booked at £80 per person, including supper, through www.iod.je. n

IoD debate to discuss Jersey preparedness

Shaping Our Future consultation begins

Acommunity consultation entitled Shaping Our Future has been launched to ask people to help create a long-term vision for Jersey.

Jersey’s Council of Ministers believes the island must look ahead to address economic, social and environmental challenges, such as an ageing population and technological and climate change.

The consultation, which involves an online survey called MyJersey, will describe what Jersey as a community believes it can achieve across a range of major outcomes, such as getting good jobs, living longer, healthier lives and feeling safe. A more targeted consultation will take place later this year, with the aim of developing a draft long-term vision by December.

Chief Minister Senator Ian Gorst said: “I hope the consultation will give our community a chance to say what they value most about Jersey and what they’d like to change – so we can develop a shared aspiration.”

The survey is at www.ShapingOurFuture.gov.je n

The States of Jersey has published a strategy paper on how Jersey’s government, economy and society can innovate using digital solutions. It marks the

start of a public consultation on the topics in the paper. The stated aim of the strategy is ‘to ensure Jersey

can capitalise on the opportunities offered by digital technology to grow an efficient government, an innovative economy and a connected society’.

Tony Moretta, CEO of Digital Jersey, said: “This is the first time all the digital ambitions of Jersey’s government, industry and civil society will be brought together into one overarching consultation and policy.

“Digital innovation will continue to radically change our lives: how we work, live, spend our free time, communicate, receive healthcare. This consultation reflects a collective commitment to exploring in depth this fundamental revolution.”

The strategy paper can be found at www.gov.je n

states publishes Digital strategy

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www.blglobal.co.uk july/August 2016 63

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Jersey receives positive MONEYVAL assessment

Jersey has a ‘mature and sophisticated regime for tackling money laundering and the financing of terrorism’,

according to a report published in May by the Council of Europe’s Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (MONEYVAL).

The report presents the findings of an evaluation that included an on-site assessment of Jersey in January 2015 and covered aspects of the island’s institutional, legislative and regulatory framework to deter money laundering and the financing of terrorism.

Assessed on 49 standards, Jersey was found to be fully compliant in 16, largely compliant in 32 and partially compliant in one. There were no standards against which the island was found non-compliant. This gave Jersey the top ranking compared to EU member states.

The MONEYVAL report also refers to Jersey as being in ‘a leading position in meeting [the] standard of beneficial ownership transparency’.

Speaking at the Jersey Financial Services Commission (JFSC), States

Henwood wins IoD Lifetime Achievement Award

At this year’s Institute of Directors Jersey Director of the Year Awards, held in May, John Henwood was presented with a Lifetime Achievement Award. The accolade recognises his former roles as Chief Executive of the Channel Television Group,

Chairman of Jersey Telecom, Founder Member of Jersey Finance and Chairman of the Tourism Shadow Board.

At the black tie awards presentation event, six other business directors walked away as winners in a range of categories. They were:● Alex Morel, ALX Training – Small Organisation Director of the Year ● Glenda Rivoallan, Healthhaus – Medium Organisation Director of the Year ● Doug Bannister, Ports of Jersey – Large Organisation Director of the Year ● Richard Summerfield, JT Group – Young Director of the Year ● Lesley Harrison, Prison! Me! No Way!!! – Public/Third Sector Director of the Year● Eamon Fenlon, Jersey Dairy – Global Director of the Year.

Wendy Dorman, outgoing Chair of IoD Jersey, said: “It was pleasing to see such a broad cross-section of Jersey business, public and voluntary landscape recognised this year, and I’m delighted that in John Henwood we have been able to recognise a remarkable individual who has helped shape Jersey life in so many ways.” n

jfsc Q1 figures show growth

Figures from the Jersey Financial Services Commission (JFSC) reflect the positive performance of all sectors of Jersey’s

finance industry in the first quarter 2016: ● The net asset value of regulated funds

under administration increased by £2.6bn from £225.8bn to £228.4bn

● The total number of regulated collective investment funds rose by six to 1,326 and at end of Q1 there were 127 active unregulated funds

● The value of total funds under investment management was £21.1bn at the end of Q1 – not including total assets under management in the qualifying segregated managed accounts, which increased by 16.4 per cent from £1.8bn to £2.1bn

● The total value of banking deposits in Jersey rose by £1.9bn to £128.4bn

● There were 33,355 live companies on the register at the end of the quarter.

Jersey Finance Deputy Chief Executive Richard Corrigan said: “This shows a further increase in the value of funds under administration, which at £228.4bn is the second highest level since March 2009.” n

Outgoing IoD Chair Wendy Dorman, John Henwood and awards host Gyles Brandreth

of Jersey Chief Minister Senator Ian Gorst said: “Jersey is in the top tier of jurisdictions – proof that we not only say we adhere to the highest standards, but that we are living it day by day.”

One area for improvement highlighted in the report is the relatively low number of money laundering convictions and confiscations, and the island’s authorities have already committed to resolve this.

Attorney General Robert MacRae QC said: "We will be working to combat financial crime and increase the number of convictions and confiscations. Indeed, since the on-site visit in 2015, there have been several money laundering prosecutions, resulting in one conviction in 2015 and four in 2016."

Senator Gorst added: "The Government of Jersey has committed to the injection of further resources into tackling financial crime, in close partnership with the Attorney General, the States of Jersey Police and the JFSC."

A summary of the MONEYVAL report from the JFSC and the States of Jersey can be found on the JFSC website at www.jerseyfc.org n


Lifestyle

▼

Words: Dave Waller

High life on the high seasOnce the domain of the wealthy, cruising has become accessible to everyone – but as the ships get bigger and open to all, the super-rich are reclaiming some seaborne exclusivity

BACK IN 1867, a paddle-wheel steam ship called Quaker City set out from New York to the Holy Land for a ‘Great Pleasure Excursion’ – it was the world’s first-ever extended cruise.

Mark Twain was among the 150 people who spent the equivalent of £1,250 apiece, not only for this once-in-a-lifetime experience, but for the honour of being one of the few who could say they’d done it. ‘I referred to all the people of high standing I could think of in the community who would be least likely to know any thing about me,’ wrote Twain of how he passed the operator’s rigorous selection process. ‘I was provided with a receipt, and duly and officially accepted as an excursionist. There was happiness in that, but it was tame compared to the novelty of being ‘select’.’

Until recently, cruising maintained this sense of exclusivity – people in dinner jackets and cocktail dresses sitting down to dinner with the captain. But things have moved on. The world’s largest cruise ship, Royal Caribbean’s Harmony of the Seas, launched this year complete with waterslides, ziplines and a funfair on board – a sure sign that cruising has sailed well and truly into the mainstream.

So with the hoi polloi now allowed on deck, luxury cruise lines serving high-net-worth individuals have had to up their game to set themselves apart.

Take luxury cruise operator Crystal, which recently announced that its ‘600-foot polar class megayacht’, named Endeavor, would launch in 2018, with two helicopters on board, a pair of seven-person submarines, several underwater scooters


Lifestyle


Lifestyle

and a remote-controlled vehicle in which wealthy guests can explore shipwrecks. And Crystal isn’t the only operator tailoring experiences for the top end. Seabourn offers its passengers the chance to kayak the misty fjords of the Arctic Circle, or to eat caviar served in recently-scooped Antarctic ice.

SeaDream Yacht Club, meanwhile, is now advertising its 20-day Sea Sky Safari cruise package, in which 52 guests will enjoy a Mediterranean cruise, a flight in a custom-configured first-class private Boeing 757 to Africa for a string of safaris, and a return flight to London via Morocco. Price: £71,000 per person.

The Crystal Serenity has consistently been ranked the best cruise ship in the world, and a redesign has just been completed that has made it even more amazing. The penthouse bathroom was among the updated rooms, featuring Italian marble mosaics, heated flooring, and a TV embedded in the vanity unit.

The 982-square-foot penthouse suite aboard Serenity’s sister ship, the Crystal Symphony, has an elegant dining area, floor-to-ceiling windows and a pedestal sink made completely out of crystal.

PERMISSION TO COME ABOARDNow, this might all sound very grandiose, and indeed perhaps a little grotesque, but not all luxury cruises are about the big, bold and extravagant.

“The modern luxury traveller has diverse tastes,” says Andy Harmer, Vice-President of Operations at the Cruise Lines International Association. “So operators tend to go with a design that’s not as opulent as in the Bond movies.”

The emphasis is instead placed on destinations, service and what the punters


Lifestyle

get to do. SeaDream’s twin ships offer what the company calls ‘casual perfection’, including a ‘champagne and caviar splash’ – when the ship docks, guests can swim in the warm sea while the head chef and crew deliver gourmet food on paddle boards.

“It’s those once-in-a-lifetime experiences that people are after,” says Mark Schmitt, Sales Director at SeaDream. “That’s what really differentiates a luxury cruise.”

THE SELECT FEWBut while the definitions of luxury may vary greatly, there are a few traits that lash these sought-after ships together. They tend to be much smaller and more mobile than regular cruise ships, which means they cover greater ground and offer more exclusive destinations. The MS Paul Gauguin is a good example, as it’s specifically designed to sail to the small ports of Tahiti and French Polynesia that most cruise ships can’t reach.

SeaDream follows a similar philosophy. Its two identical vessels each weigh only 4,300 tons – Harmony of the Seas weighs in at nearly 227,000 tons. This means they can access ports such as St Barts, a celebrity favourite in the West Indies, or navigate the impossibly narrow Corinth canal in Greece.

“It’s more and more about the destination,” says Schmitt. “And we’re very lucky to go to places that others can’t reach. These are unique – we avoid turning up in places where three other vessels are tipping off 4,000 people.”

Shore excursions are therefore unique and often bespoke. Lynn Narraway, Seabourn’s MD for the UK and Ireland, describes these as “bucket list experiences”. Guests can be allotted their own private guide and driver, join an exclusive behind-the-scenes tour of Unesco sites or follow

the ship’s chef through Mediterranean markets, sampling the seafood and produce as it’s bought for that night’s dinner.

Yet the small size also means a greater quality of service – expect around one crew member for every guest. SeaDream, for example, carries 96 crew and only 114 guests, versus 5,400-plus guests and 2,100 crew on the Harmony of the Seas.

This naturally adds to the experience. “Some guests like having their bath run and their bags unpacked, and to see the stewards regularly,” says Narraway, whose company has recently struck a deal with Michelin-starred chef Thomas Keller to oversee its on-board dining.

“Others don’t want that, but will want us to notice that they don’t like almonds in the nut selection. So we have to provide an intuitive, almost clairvoyant service. And we have to be prepared to do anything. One woman staying in our top suite didn’t like the sofa, so we changed it for her. She’d paid £350,000 for her holiday.”

That fee is nearing the top end, even for luxury cruising. The cheapest ‘luxury’ seven-night cruise would cost around £3,000 per person, and there are a lot of choices (and price points) in between.

The super-wealthy seeking a truly exclusive experience can always take it a step further than a bog-standard luxury cruise – by chartering their own ship. This provides the one luxury you can’t get on even the most lavish cruise ship: total privacy. Chartering allows the traveller to know exactly who’s on board, set the departure and arrival points and decide the itinerary. SeaDream offers all-inclusive seven-day charters for £50,000 a day.

“Among high-net-worth individuals we’re seeing a lot of charters of smaller luxury ships,” says Edwina Lonsdale, MD

at cruise agent Mundy Cruising. “Crystal’s Esprit can take 64 guests, sailboat cruise line Le Ponant 62 and SeaDream up to 114. But high-net worth individuals also like adventure charters – taking small expedition ships to the Galapagos, Alaska or the Sea of Cortez and going off the beaten track for a once-in-a-lifetime adventure with lots of activities. That’s great for multi-generation trips.”

A FUTURE AFLOAT As for the future of the ultra-luxury cruise market, it looks buoyant. The key signifier is capacity, and a wave of new ships are to be launched soon – from Regent Seven Seas Cruises’ ‘all-suite, all-balcony’ Explorer (with a 10-night Azure Awakening Venice-to-Rome itinerary, all-inclusive amenities and $300 shipboard credit per suite); Seabourn’s new Encore (with ‘understated elegance’ designed by hospitality design icon Adam D Tihany); and Silversea’s Silver Muse.

But it seems that the ultra-luxury market has even greater things on the horizon. “The real game changer is what’s happening at Crystal,” says Lonsdale. “The company is committed to creating a luxury travel brand on the shoulders of Crystal Cruises’ reputation, first with the introduction of exclusive yachts, river cruise yachts and three cruise ships where you can buy on-board residences, and then with its luxury planes – not just passenger jets, but touring planes with 64-bed accommodation operating air tours to the highest specs.”

A great pleasure excursion direct to the heavens? What would Mark Twain have made of that? n

DAVE WALLER is a freelance writer

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➨INSIDE THE AGENDA: ACCESSORIES, ART, CARS, DRINKS, FASHION, FOOTWEAR,

FRAGRANCES, FURNITURE, HOMEWARE, WATCHESEverything you need for a more stylish life.

1. COLOUR YOUR WORLDLooking for a sound investment in art? Look no further than Brazilian-born, Miami-made artist Romero Britto. His vibrantly coloured and boldly patterned paintings combine elements of cubism, pop art and graffiti in an expression of warmth, wit, optimism, hope, happiness and, above all, love. Although not well known on this side of the Atlantic (yet!), Britto’s work is widely exhibited in North and South America. As one of Brazil’s 1

THE AGENDAflies down to Rio!

favourite sons, he was invited to be an honorary torch bearer for Rio 2016, as well as being appointed Global Ambassador for the Games. In a partnership deal with Coca-Cola, Britto will also be producing paintings, badges, memorabilia and a special limited edition Coke bottle, all on an Olympic theme. The knockout painting shown here is entitled News Café. POA, www.shopbritto.com and www.britto.com

Artw

ork

©Br

itto

Cent

ral,

Inc.

The Agenda is compiled by BL’s Fashion and Lifestyle Editor, Thom O’Dwyer, with additional material by Danny Cobbs.

THE AGENDA


2. TRUE BRAZILIAN SPIRIT If you’re having friends and family round to cheer Britain’s best on to victory at the Rio Olympics, why not go with the South American flow and serve Brazil’s national spirit Cachaça (pronounced kah/SHAH/sah)? It’s been produced for over 500 years and, being made from the fermented juice of sugar cane, is actually a type of rum.

In Brazil it’s referred to as aguardente de caña and is widely available in two distinct types – premium Gold, which is aged in wood barrels for up to 15 years and is meant to be drunk straight, and White, which isn’t aged and is bottled immediately after distillation.

White is much cheaper than Gold, and is used to prepare Brazil’s national cocktail, the Caipirinha. Invented in Brazil and closely associated with Rio de Janeiro, it’s as easy to make as it is to drink. Just take half a juicy lime and cut into four wedges. Put the lime into an ‘old fashioned’ glass with two teaspoons of golden caster sugar, then mash both together with a muddler or wooden spoon. Fill the glass with crushed ice, add two fluid ounces of Cachaça, and it’s bottoms up for Britain! Engenho de Vertente Cahaça Envelhecida – Traditional White, 50cl, £23.96; Germana 10-year-old Cachaça, 70cl, £108.78, www.amazon.co.uk

3 3. GET THE PARTY STARTED!Celebrate Rio 2016 in ultra-chic Olympian style. Men’s Society, the quality gift supplier aimed at the men’s market, has come up with the perfect carnival-inspired receptacles to serve up your Caipirinhas and lethal straight-up shots of Cachaça. Yes, it’s a golden pineapple! In Brazil, the pineapple

is recognised as a symbol of hospitality and warm welcome. The pineapple shot glass below comes in a set of two, each with a lid, and is hand-crafted

in polished brass. Turn over the lid, and it can be used as a stand. There’s also a larger tumbler-size

glass for ice-cold Copacabana cocktails, left, which comes with a brass straw.

Shot glasses per set, £32; tumbler with straw, £95, www.amara.com

24. MAKE A SPLASHFounded by photographer Adam Brown in 2007, London-based Orlebar Brown has for years been the man’s go-to brand for smart tailored swim shorts and beach apparel in a variety of bold colours and graphic patterns. The slimfit Bulldog quick-drying swim shorts pictured above feature Slim Aarons’ iconic shot of the pool at the Princess Hotel in Acapulco.

Orlebar Brown now also produces a women’s line. The Almada bathing costume below showcases an exclusive poolside print that wraps around the body of the one-piece suit. Both swimsuits, £225, www.matchesfashion.com

PS: For something truly unique, Orlebar Brown has teamed up with new app SnapShorts, so that the artistically inclined can create their own photo print swim shorts. Simply upload your own snapshot to the app, make a few adjustments and, presto change-o, your fashion masterwork will be yours in three weeks.From £395, www.orlebarbrown.co.uk

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THE AGENDA


77. DON’T SWEAT IT As part of her decade-long collaboration with sportswear giant Adidas, Stella McCartney is back on board as Creative Director for Team GB’s look at the 2016 Rio Games. So it seems fitting to focus on four fabulous functional and colourful highlights from the Adidas by Stella McCartney SS16 streamlined commercial collection.

The seamless all-in-one, designed with yoga in mind, is crafted from ultra-soft sweat-wicking yarns and has a compression fit and flattering on-trend colour-blocked panels. Its racer back, ribbed waistband and cropped leg also make it ideal to wear on its own while working out, or with a sporty hooded sweat for street-smart casual wear.

The cotton jersey t-shirt is a pretty addition to any girl’s workout wardrobe. It has a loose shape with short sleeves and is patterned with a sweet tonal blue blossom print. Wear it out jogging with the cropped high performance leggings in Climaheat stretch fabric and zebra-striped mesh panels.

Finally, reworking the famous Adidas Adizero Takumi low-top trainer, McCartney mixes cobalt blue mesh with reflective white TPU panels and lime green accents. The trainers also sport a durable, non-marking Adiwear sole with Continental grip coating. McCartney’s new activewear collection for Adidas is definitely the fiercest gear to get sweaty in. All-in-one, £105; blossom print t-shirt, £55; leggings, £70; trainers, £150, www.matchesfashion.com

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➨

5. HOT FOOT ITIt’s party time! So why not do it Brazilian style, fire up your barbecue and have some churrasco al fresco? Go with the Olympic flow and greet your guests wearing these fun, colourful souvenir 2016 R1 Olympics flip-flops by Lunar Shoes. Made of hard-wearing rubber – what else? – they’re durable but soft as the marshmallows that’ll soon be toasting on the barbie grill.

And to add a bit more topical fun before you get down to the serious business at the white-hot charcoal grill, this Rio unisex-fit adult apron – which comes in five stand-out colours – will certainly make you a talking point. Have a few more Caipirinhas and whoop it up in style! Flip-flops, from £12; Rio barbecue apron, £14.95,www.amazon.co.uk

6. TRIBUTE TO BRAZILJust in time for Rio, luxury brand Bulgari has launched an exotic addition to its Omnia collection of intoxicating female fragrances. Omnia Paraiba is a powerful and vibrant hymn to Brazil.

It’s an olfactory creation where flowers and exotic golden fruit resonate. The scent opens with a sharp and unmistakable citrus start, then moves on to the floral luxuriance and a heady bouquet of gardenia with notes of passion flower adding depth.

The exotic rhythm picks up with the timeless elegance of vetiver and offbeat accents of cocoa, creating an exquisite sensation of skin warmed by the Brazilian sun. This is a seductive and sensual bouquet perfect for day or night. Gorgeous. £48-£59 for 100ml, major department stores nationwide

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THE AGENDA

8. SPEED MERCHANTFor the past 45 years, Mercedes has been mooting the idea of a ragtop version of its luxurious S-Class coupe. Finally, the wait is over, writes Danny Cobbs.

Beautifully crafted, both inside and out, the S-Class Cabriolet brilliantly marries together old-fashion glamour with 21st century knowhow. Three models are offered, all with twin-turbo-charged petrol engines either in V8 or V12 cylinder configurations. Prices start at £110,120 for the S500 AMG Line, rising to £192,805 for the monstrous 6.0-litre Mercedes-AMG S65 Cabriolet. All are fully loaded, the only options being a few trim choices and some advanced suspension upgrades.

The large V8 petrol engine in the S500 is blisteringly quick; accelerating from 0-62mph in 4.6 seconds and up to an electronically limited top speed of 155mph. Opt for the raucously loud Mercedes-AMG tweaked S63 or S65 models and acceleration reaches supercar levels, although the handling is more suited

8

to cruising than lapping a race track.

Its triple-layered fabric roof opens in less than 20 seconds, deployable on the move up to speeds of 28mph. Lid down, the Aircap wind deflectors fore and aft and the Airscarf neck-heating in the front seats ensure occupants are kept snug and warm, even on a crisp winter’s day.

The desire to make the S-Class Cabriolet both a performance car and a highly refined cruiser might seem at odds, but so much engineering has been lavished on this range-topping Mercedes that it really is an accomplished all-rounder. In the world of soft-top grand tourers, this car is simply epic.From £110,120, www.mercedes-benz.co.uk


THE AGENDA

9. A REAL WRIST-TURNERLong associated with sporting watches, TAG Heuer has definitely stepped up its game in Olympic year by rattling the collective cage of haute horlogerie. Enter the TAG Heuer Carrera Heuer-02T, an automatic chronograph with tourbillon and Carrera strap. While its competitors are producing similar watches for the price of a deposit on a house, this status timepiece is far cheaper, yet still in a class of its own. A chunky little beauty that’s about £50,000 less than you’d expect to shell out for a Swiss-made tourbillon wristwatch, and £98,000 less than the last tourbillon announced by TAG, the belt-driven V4 tourbillon.

This is a champion timepiece, a high flyer of tourbillons with a whirlwind mechanism, and is COSC-certified. The ultimate lifestyle watch, it has a certain swaggering laddish cool, with its tourbillon enhancement offering that extra bit of excitement and complexity. This is fun, impressive and value for money in spades. A little piece of watch-making history. And you can bet your sweet bippy that Tom Daley has one already.From £12,100, www.tagheuer.co.uk

10

10. RINGSIDE SEATThis Prickly Pear Chair – which comes in both Gents and Ladies versions – is the inspired work of Mexico-born but London-based furniture and interiors designer and consultant Valentina Gonzalez Wohlers.

The chairs are a humorous cultural blend of Latin American and European influences. The classic French Rococo oval chair with traditional French button upholstery detail is combined with an avant-garde and totally unexpected Nopal cactus back.

No two chairs are the same, and the Gents chair has armrests and double cacti.

Designer Karl Lagerfeld was the first to snap one up back in 2009, and the chair is now on sale at leading New York department store Bergdorf Goodman. What’s more, the illustrious Denver Art Museum acquired the chairs for its permanent collection – so it’s now proudly a real museum piece. Gentleman Chair, £3,750; Lady Chair, £2,885, www.valentinagw.com

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➨

THE AGENDA

11. ATTENTION GRABBERAlways the clever lad, tailor and menswear designer Gresham Blake makes a playful nod and wink to Rio in his latest stand-out collection. His face-slapping leafy jungle prints are a surefire way of standing out in the crowd at any Olympics party.

The Limited Edition tropical foliage print, 100 per cent cotton Amazon shirt, pictured left, has a semi-cutaway collar, triple-button cuffs and tailored fit. For guys with chutzpah to spare, there’s also an amazing Amazon print single-breasted jacket that’s the bee’s knees and the cat’s pajamas rolled into one.

And for maximum impact – and an extra £145 – you can pair the jacket with matching trousers.

Also in the Olympic spirit is the pure silk Swimmer necktie. We were unable to confirm whether world champion British swimmer Adam Peaty – who aims to win the first breaststroke gold since Adrian Moorhouse in 1988 – posed for the black silhouette of the tie’s swimmer motif. Shirt, £120; Jacket, £350; Tie, £75, www.greshamblake.com

1211. SWEET SMELL OF SUCCESSPasha de Cartier Édition Noire was a huge success when it was launched in the 1990s – the perfect scent for the discerning high-profile man who demands quality and elegance in every part of his life. Now Pasha de Cartier Édition Noire Sport accelerates the speed of that high-performing masculine fragrance with an Olympian-like rush. The distinctive woody aroma of patchouli with a touch of citrus gives a heady but athletic freshness to the scent. The addition of funky notes of watermelon, sandalwood, amber and cedar – a new and sporty twist – makes this knockout men’s fragrance a definite sporting success. It’s cooler than cool. £53-£77 for 100ml, at major department stores nationwide

13. IN THE BAGFrom that iconic design duo Dolce & Gabbana – always first on the block with an edgy fashion must-have – comes this banana leaf-print box bag from their pre-AW16 collection. Their tropi-cool jungle theme is translated loud and clear in this exotic but classically correct handbag, lavishly decorated with bejewelled and crystal-encrusted 3D embellishments of insects and creepy crawlies straight out of the rainforest. Gold-tone metal trims – including the D&G trademark padlock clasp – shine expensively, while deep-green snakeskin is used for the piping, handle and shoulder strap, adding exotic allure. A lesson in Brazilian-inspired glamour. Muito bonita, meninas! £2,400, www.matchesfashion.com

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THE AGENDA14

15. GOING FOR GOLDMetallic gold trims bring a high-octane edge to Golden Goose Deluxe Brand’s iconic beige Super Star leather low-top trainers. Purposefully distressed and scuffed for a worn-in, ‘world best‘ post-marathon look, they’re detailed at the tongue and toe with tonal suede panels. These kicks are definitely front runners. £260, www.matchesfashion.com

14. RIGHT AT HOMEGet into the Rio carnival swing

with these totally tropical homewares. A perfect

piece for any kitchen, store your sweet treats in this funky glazed ceramic

pineapple storage jar by Pois Potten, which

comes in the True Brit Union Jack colours (below) or a hot flamingo pink colourway.

The Olympic Coat Hanger (above) is from the Paris-based

design collective Eno Studio, each one signed by the artist. Handcrafted in natural beech wood, the Olympic Rings hang delicately from leather straps – perfect for storing scarves, ties or other items, or for hanging towels in the bathroom.

These madly colourful cushions also tap into the spirit of Brazil. The Kissen Jungle Boogie cushion strewn with pink flamingos and jungle greenery is by wacky German gift and homeware e-commerce specialist design3000.de. And from EcoChic – an eco-friendly online treasure trove of home furnishings and furniture – comes this kitsch Señorita Accent Cushion, inspired by 1950s pin-up girls, and the Maui Aqua Accent Cushion, featuring a cool vintage photo print with graphic pineapple overprint, exclusively designed by Australian artist Megan Skehan. Pineapple jar, £47, and Olympic Coat Hanger, £189, www.amara.com; Kissen Jungle Boogie cushion, £32.16, www.design-3000.de; Señorita Cushion, £34, and Maui Cushion, £68, www.ecochic.com.au

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Tel: +44 (0)1534 870670

Licensed by the Jersey Financial Services Commission in the conduct of trust company business

Deloitte LLPDeloitte LLP offers professional services to the UK and European market. The company has the broadest and deepest range of skills of any business advisory organisation and employs over 14,400 exceptional people in 28 offices in the UK and Switzerland. We provide professional services and advice to many leading businesses, government departments and public sector bodies and publish many influential studies and thought leadership pieces. Deloitte LLP employs 160 professionals across the Jersey, Guernsey and the Isle of Man offices. It is the UK member firm of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee, and its global network of 150 member firms, each of which is a legally separate and independent entity. Deloitte provides audit, tax, consulting, and financial advisory services to public and private clients spanning multiple industries. Deloitte brings world-class capabilities and high-quality service to clients, delivering the insights they need to address their most complex business challenges. For further information please do not hesitate to contact: John Clacy, Partner, GuernseyEmail:[email protected] +44 (0) 1481 724011 Greg Branch, Partner, JerseyEmail: [email protected]: +44(0)1534 824325www.deloitte.com

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Directory

About EYEY is a global leader in assurance, tax, transactions and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities.

Our strong network has enabled us to build close working relationships with our colleagues in EMEIA and across the world. This allows us to respond quickly to our CI clients’ needs, drawing upon our industry experience across all our services lines.

To discuss how we can support your business, please contact one of our partners below:

Mike Bane, Partner, Assurance and TASE: [email protected] T: 01481 717435

Andrew Dann, Managing Partner, AssuranceE: [email protected] T: 01534 288655

Geraint Davies, Partner, Assurance E: [email protected] T: 01534 288639

Chris Matthews, Partner, AssuranceE: [email protected] T: 01534 288610

David Moore, Partner, Assurance and Advisory E: [email protected] T: 01534 288697

Peter Willey, CI Head of Tax E: [email protected] T: 01534 288 212

Wendy Martin, Partner, Tax E: [email protected] T: 01534 288 298

David White, Head of Tax, Guernsey E: [email protected] T: 01481 717 445

EXCELLENCE IS OUR STARTING POINT As specialists in Corporate Services, Fund Services, International Finance and Private Wealth, Elian has a clear, uncompromising vision: to continually deliver more value by raising the bar in administration services.We work with multi-national corporations, financial institutions, high net worth individuals, family offices and investment funds, and we believe that the best can always be better.

With over 640 professionals across a network of 16 international offices, covering a wide range of time zones and key financial centres, we are able to handle large, demanding and complex engagements. We are always looking to set new industry standards by challenging standard practice.

From technical skills and market understanding to outstanding client service, we are relentless in our pursuit of excellence.

SERVICES● Private Equity, Real Estate and Hedge Fund

Administration● Depositary Services● Corporate Services● Private Wealth Solutions● Capital Markets Solutions● Employee and Executive Incentive Plans● Investment Monitoring and Management● Regulatory Reporting and Compliance

Services

For more information please contact:

Philip NormanChief Commercial Officer+44 1534 [email protected]

Lisa Mclauchlan Business Development Director+44 1534 [email protected]

elian.com

Equiom is a global fiduciary services provider with offices in some of the world’s premier International Financial Centres, including Jersey, Guernsey, Hong Kong, the Isle of Man and Malta. We create innovative and effective structures to protect private and corporate clients’ wealth.

Our experienced and highly qualified teams offer services in specialist sectors including trust, corporate, property, family office, eBusiness, yachting, aviation, crewing, tax and VAT.

We are an award-winning, independent company focused on strategic thinking and quick responses to clients’ requirements. We continually seek to develop our services to provide an unrivalled range of opportunities for clients.

Equiom’s Jersey and Guernsey teams have significant experience relating to the setup and administration of trusts and companies and the market-leading knowledge required to appropriately protect clients’ assets.Equiom (Jersey) Limited is regulated by the Jersey Financial Services Commission. Equiom (Guernsey) Limited is licensed by the Guernsey Financial Services Commission.

Equiom (Jersey) Limited

Address:Equiom (Jersey) LimitedOne The EsplanadeSt HelierJerseyJE2 3QA

Tel:+44 1534 760100

Email:[email protected]

Web:www.equiomgroup.com


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To advertise in the directory in print or online contact Carl Methven on + 44 (0)1534 615886 or [email protected]

➔

The Intertrust Group is a global quality leader in the trust and corporate services sector, providing a broad range of specialised administrative services to multinational corporates, financial institutions, alternative investment funds and private clients from every corner of the world.

Intertrust in Guernsey is one of the Channel Islands leading fiduciary companies offering a range of trust and corporate services, fund administration services, taxation services and compliance out-sourcing services. With over 130 experienced and highly qualified staff and a presence in Guernsey which goes back to 1900, Intertrust Guernsey can provide professional, personal and multi-jurisdictional services for clients all over the world.

For further information, please contact:

Intertrust GuernseyP O Box 119, Martello Court,Admiral Park, St Peter Port,Guernsey GY1 3HB

Phone: 44 (0)1 481 211 000

E-mail: [email protected]

www.intertrustgroup.com/en/locations/guernsey

Hawksford is an international and award-winning corporate, private client and funds business.

Through our three core service pillars - corporate, private client and funds - we are experts in providing a wide range of administration and structuring solutions across our seven international offices.

We offer a comprehensive range of services to and for trusts, companies, foundations, partnerships, family offices and investment funds. We also provide listing services, wills and probate, succession planning and employee solutions.

Our people are highly trained, experienced and offer impeccable client service. We are constantly evolving our thinking, seeking new and better ways of doing things, and making investments for the long-term benefit of our clients.

Our independence enables us to offer creative and pragmatic solutions for a wide range of institutional, entrepreneurial and high net-worth clients. We have expanded our global footprint and service offering, moving into core regional markets across Europe, Asia and the Caribbean and drawing on a global network of leading professionals and advisers.

For more information, please contact us:T: +44 (0)1534 740000E: [email protected]: www.hawksford.com

Steve Robinson – Director, CorporateT: +44 (0)1534 740270E: [email protected]

James Howe – Director, Private Client T: +44 (0)1534 740246E: [email protected]

Claire Keeney – Director, FundsT: +44 (0)1534 740176E: [email protected]

A leading accountancy practice, with offices based in Jersey and Guernsey, KPMG in the Channel Islands provide audit, tax and financial advisory services.

KPMG’s global network enables us to draw on our international resources and skills to meet our clients’ needs. We address complex business challenges with methodologies and processes spanning markets and national boundaries.

Fundamental to KPMG’s approach is our focus on industry sectors. Our vision is simple, to turn knowledge into value for the benefit of our clients, people and capital markets.

For further information please contact:

Neale JehanHead of [email protected]

Andrew QuinnDeputy Head of Audit, [email protected]

John RivaHead of [email protected]

Tony ManciniExecutive Director, [email protected]

Ashley PaxtonHead of [email protected]

Robert KirkbyExecutive [email protected]

www.kpmg.com/channelislands


Directory

Minerva is a family owned business that has been in existence in Jersey for over 35 years.

As a leading independent provider of trust, corporate and fund administration services, we focus on internationally active clients located in sub Saharan Africa, India, the GCC and Europe.

We firmly believe in the value of personal relationships and are familiar with how our clients and professional intermediaries operate from a cultural and business perspective within these regions.

In addition to Jersey, we provide services from a number of offices based in key jurisdictions including London, Geneva, Mauritius, Dubai, Singapore and Amsterdam, as well as affiliate offices in Kenya, India and New Zealand.


John WoodManaging Director

Minerva Trust & Corporate Services LimitedPO Box 21843/45 La Motte StreetSt HelierJersey JE4 8SDChannel Islands

T +(0)1534 702930E [email protected] www.minerva-trust.com

Lumiere Wealth is proud to be one of Jersey’s leading Independent Wealth Management providers. Based at Castle Quay in Jersey, we offer a bespoke, independent, wealth planning advisory service to our private clients, corporate intermediaries and corporate clients.

We provide a first class and friendly service. Our qualified consultants have over 200 years of experience collectively and all are very proud of the relationships they have built and continue to build with their clients.

Our scope of services includes:

● Investment products● Retirement planning● Life cover● Income protection● Critical illness cover● Key man insurance● Private medical insurance● Life policies● Employee benefit schemes

Lumiere Wealth is regulated by the Jersey Financial Services Commission.

To discuss how we can help you with your wealth planning needs, please contact:

Andrew Wesley ForsterBusiness Development ManagerLumiere WealthMillais HouseCastle QuayLa Rue de L’EtauSt HelierJerseyJE2 3EG

Telephone: (0) 1534 625 001

Email:[email protected]

Specialty: Bespoke IT Development & Business Consultancy

Puritas is an award-winning provider of intuitive software and business solutions for the financial services industry.

Specifically designed to meet the increasingly complex accounting, compliance, and reporting needs of our clients, all software features robust audit and control capabilities which can be easily updated to reflect changes in the regulatory environment.

Our products include:● PureFunds - a unitized product platform

specifically designed to support many different types of asset class and fund structures and help fund administrators and portfolio managers better manage investor activity

● PureClient - an advanced customer due diligence/client management system which will maintain and update client records for any entity or relationship and provides the necessary transparency and look-through reporting that is needed to manage sophisticated structures

● PureManager - a bespoke software package for fund and investment managers which provides for effective control, analysis, reconciliation and reporting of daily trading activity.

As well as software development, our services include:● Systems integration and implementation● Programme and project management● Project and business consultancy

To find out more how Puritas can help your business.

Contact: Mike Feighan - DirectorPhone: +44 (0) 1534 874100Email: [email protected]


To advertise in the directory in print or online contact Carl Methven on + 44 (0)1534 615886 or [email protected]

www.blglobal.co.uk

Building trust in society and solving important problems

We focus on three things at PwC in the Channel Islands: assurance, tax and advisory services. But how we use our knowledge and experience depends on what you want to achieve. So whichever one of our 320 plus staff in the Channel Islands you work with (or 208,000 people across the PwC global network of member firms), they’ll start by asking the following questions:

Are you looking to build trust? Give your shareholders more value? Or do you want to do something completely different with your strategy?

When we work with you we really listen, to understand you better. We’ll get to know you, your business and your goals. Then we’ll share what we’ve learned to help you get there. We want to deliver the value that you, our clients, our people and our communities are looking for.

Talk to us about your issues and aspirations.


John Roche, Partner, GuernseyTel: +44 1481 752040 [email protected]

Karl Hairon, Partner, JerseyTel: +44 1534 [email protected]

www.pwc.com/jgFollow us: @PwC_CI

Rathbone Investment Management International is part of the award winning Rathbone Brothers PLC (“Rathbones”), which was established in 1742. Rathbones is a leading provider of discretionary investment management services for private investors, charities and trustees.

We enjoy the stability afforded by being a FTSE-250 listed company with significant critical mass (£28.3 billion of funds under management as at 30 June 2015).

We offer a range of tailored investment options:l Bespoke portfolio management l Multi-manager portfolios l Unitised portfolios (the RIMI Strategies

Funds)

Our services are delivered by a team of innovative and experienced offshore professionals based on an understanding of a client’s specific investment and risk objectives, backed-up by the performance-driven Rathbone investment process and encompass the full universe of assets.

For further information please do not hesitate to contact:

Jonathan Giles, Managing [email protected]

Phil Bain, [email protected]

Vaughan Rimeur, [email protected]

+ 44 (0) 1534 740550www.rathboneimi.com

Rathbone Investment Management International Limited is regulated by the Jersey Financial Services Commission

We are an award winning, established law firm with a multi-facet approach to law. Renowned for our integrity, accountability and vast legal network, we build longstanding relationships with clients who return to us time and again. This is substantiated further by our Lexcel status, recognising us for excellence in legal practice management and client care.

Representing clients across the Channel Islands, UK and Europe, we act as their strategic legal partner utilising our off-shore expertise and international reach. We understand your business is unique and that you require a bespoke solution to meet your business needs and responsibilities.

In this way, we ensure our services are aligned to your legal requirements - whether you are a global corporation, a business start-up, a national government or a private client.

Our range of bespoke legal services includes:

For expert legal advice that can redefine your business, please contact us today.

E: [email protected]: +44 (0) 1534 888 666W: www.viberts.com

l Commerciall Dispute Resolutionl Employmentl Family

l Personall Property


Tea or coffee? Coffee – the largest cup possible and preferably on multiple refill option.

Favourite TV programme? Silent Witness – I always like to think I know what’s going to happen before anyone else in the house does.

Your earliest memory? My first pony ride when I was three years old, on what can only be described as a barrel with four legs and lots of hair and teeth all going in different directions.

Somewhere you’ve never been that you would love to visit? Argentina, a country with extreme beauty, extreme sports and extremely welcoming people – or so I’m told.

What’s the scariest thing that’s happened to you? I broke my back when I was out three-day eventing in my late teens. I was lucky to make a full recovery.

Your best quality?Empathy and doing the ‘right’ thing for those around me.

Something about yourself you’d change? It’s a bit of an obvious answer I’m afraid – to like the gym more and my food less.

Last meal on death row? Argentinian fillet steak with a side order of seared Guernsey scallops and some truffle chips.

Cats or dogs? Dogs – even though I rank well below our springer spaniel in the Sharpe family pecking order.

Most embarrassing moment? Turning up to an event in a

rather outlandish fancy dress costume (by

popular demand the pictures are no longer publicly available) to find everyone else in

black tie!

First job you had? Paper distributor – or paper

round to you and me. I had five rounds on the go before I was 12 and was sub-contracting them out for a management fee.

Worst job you’ve done? A summer job on a mushroom farm – you know what you have to shovel to make mushrooms grow!

What’s the most lavish gift you’ve bought someone? A private lunch for my wife and me with Cinderella in her castle at Disney World. Any hobbies? Local sport. With a sports-mad family, most of my time is spent either watching or helping, where possible, with a number of sports activities on our beautiful island.

Something that drives you nuts? People who have two mouths and one ear.

If you could go back in time, where would you go? That’s a difficult one, but probably to a 1950s American high school – I’ve always wanted to be a T Bird.

What song would you like played at your funeral? The Only Way Is Up by Yazz and the Plastic Population. I loved the 1980s and would want people to remember the fun side of my life.

Buzzword you hate the most? ‘Bandwidth’ – particularly when it’s in the sentence “sorry, but I just don’t have the bandwidth”.

Sweet or savoury? Savoury all the way. Cheese and biscuits or sticky toffee pudding? There’s simply no contest.

Something about you that people might be surprised by? A love of trampolining. (I will leave that thought with you.)

Julien Sharpe is Managing Director of Zedra Trust (Guernsey).

20questions with

JULIEN SHARPE

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FAIRYTALE DINNER

BLACK TIE?

GAUCHO DREAMS

INSTITUTE OF DIRECTORS JERSEY BRANCH

ANNUAL DEBATE 2016

FUTURE-PROOFING JERSEY

THURSDAY 15 SEPTEMBER 2016 | 5.30PM - 10.30PM

RJA&HS, TRINITY, JERSEY

Jersey’s most anticipated business event returns this year to focus on ‘Future-Proofing Jersey’. With the aid of moderator Alastair Stewart OBE and

expert panellists, the Debate will explore whether Jersey has the right leadership, brand, systems and expertise in both the private and public sectors to steer a safe

course and ensure a successful future for local businesses and residents.

BOOK YOUR PLACE AT WWW.IOD.JE

IoD ANNUAL DEBATE SPONSORED BY

DRINKS RECEPTION SPONSORED BY

0033 IoD Annual Debate BL Advert AW.indd 1 28/06/2016 19:17

Trust | Corporate | Family Office | Tax & VAT Property | eBusiness | Yachting | Aviation | Crewing

A partnership built on trust.

We are dedicated asset guardians,more than just a service provider.

www.equiomgroup.com

Whether you are a successful individual or corporation, you can trust Equiom to protect and nurture your wealth. We are your asset guardians, here to assist with:

• The establishment, formation and administration of trusts, foundations and companies

• Specialist tax & VAT planning and tailored ownership structures for property, yachts and aircraft

• eBusiness solutions, including eGaming licence applications, corporate structures and VAT advice

Equiom (Guernsey) Limited is regulated by the Guernsey Financial Services Commission.

GUERNSEY HONG KONG ISLE OF MAN JERSEY MALTA Equiom (Jersey) Limited is regulated by the Jersey Financial Services Commission.

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bl magazine issue 45 july/august 2016

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