Gibraltar: Offshore Business Sectors
Commercial Trading Companies
Due to its particular set of advantages (membership of the EU, offshore tax regimes, climate, English language, common law, low costs) Gibraltar has always attracted certain types of trading operation, whereby a Gibraltar company can reap some or all of the profits generated by trades taking place elsewhere. In some cases, its excellent port and handling facilities allow trans-shipment if that is needed as part of the supply chain.
The management of trading operations often generates administrative or sales or customer-handling jobs, and the Government of Gibraltar offers incentives to attract such companies. The massive retrenchment of the British military has left Gibraltar with a persistent unemployment problem - something that marks it out from most its competitors, which have the opposite problem.
Thus it is easily understandable that when the UK betting industry started looking for a new home, from 2000 onwards, the choice should have fallen on Gibraltar. Readily available, well-educated, low-cost, English-speaking labour is a big advantage in attracting customer-service centres.
Gibraltar also has an unusually sophisticated telecommunications environment, which is vital in setting up e-commerce operations. It was therefore expected that other industries would follow betting and gambling in establishing sales, marketing and service operations offshore to take advantage of the e-commerce possibilities in low tax jurisdictions.
For a company with B2C or B2B trading operations in high-tax countries, large parts of its sales, marketing and procurement activities can be based in a low-tax area such as Gibraltar. Distribution of physical goods in high-tax areas can be outsourced or can be handled locally, while distribution of digital goods (eg software or music) can of course be undertaken locally. Corporate structures can be adjusted so that profits do not have to be remitted to the high-tax jurisdiction.
See offshore-e-com.com for extended descriptions of how businesses can take advantage of the combination of offshore and e-commerce, and see E-Commerce In Gibraltar for more details of local legislation.