Offshore jurisdictions compete vigorously with one other to provide the best tax and legal environment for wealthy individuals to structure their assets within.
However, one effect of the crackdown by the OECD and the EU has been for the regimes’ leading offshore centres to implement similar measures, significantly reducing the tax and regulatory differences between them. It has also had the effect of reducing the number of ‘premier league’ offshore jurisdictions as the cost of complying with the OECD and EU requirements has driven more marginal jurisdictions out of the game. Now, up to a point, having a robust regulatory regime is seen as an advantage for offshore jurisdictions rather than a drawback.
The leading offshore jurisdictions now comprise the UK dependencies of Jersey, Guernsey and the Isle of Man, former British colonies in the Caribbean, the Cayman Islands, the British Virgin Islands and the Bahamas and Bermuda in the Atlantic.
At the same time, the distinction between ‘offshore’ and ‘onshore’ jurisdictions is also blurring as many ‘onshore’ countries, such as Ireland, Luxemburg and Switzerland (which has recently changed its law so as to recognise trusts under Swiss law) have adjusted their tax and legal regimes to try and win some of the business that has traditionally headed offshore.
Nevertheless, differences do remain between offshore centres. Subtle distinctions in the legal structures and tax laws between jurisdictions can make all the difference to whether you can achieve what you want to achieve and, should you end up in a dispute, the court systems of the different offshore jurisdictions vary greatly in their efficiency and speed.
Most of the leading offshore law firms now operate in some or all of the leading offshore jurisdictions and can offer advice as to the best structure for your individual needs.