Gibraltar: Law of Offshore
Gibraltar has signed a total of 20 Tax Information Exchange Agreements - 17 of those in 2009.
Ahead of the G20 London Summit in 2009, the government of Gibraltar released a statement repeating its longstanding commitment to exchange of information on the basis of the current OECD model agreement.
The statement confirmed that Gibraltar had committed to the OECD standard on tax transparency and that it had concluded negotiations on the text of an agreement with the United States of America, and the operative parts of a text with another of the largest OECD countries.
"Gibraltar shares the view that international co-operation in tax matters has become increasingly important, and will inevitably and necessarily be an ingredient of the new financial order that will emerge in the aftermath of the current global financial crisis. Gibraltar remains willing to participate in exchange of information on the OECD model basis," said the statement.
The agreement between the US and Gibraltar was signed by US Secretary Tim Geithner and Gibraltar Chief Minister Peter Caruana in London in advance of the G20 Summit.
The Tax Information Exchange Agreement (TIEA) with Gibraltar provides the United States with access to information it needs to enforce US tax laws, including information related to bank accounts in Gibraltar.
The TIEA was the first of its kind for Gibraltar and permits the United States to seek information from Gibraltar and vice versa on all types of taxes in both civil and criminal matters.
As with all agreements to exchange information, only specific tax authorities are allowed to receive and send information.
Information exchanged pursuant to the TIEA may be used only for tax purposes, and the tax authorities must safeguard the confidentiality of information exchanged pursuant to the TIEA.
The TIEA allows the United States to ask for criminal tax information relating to any taxable year and for civil tax information relating to taxable years beginning after 2008.
Under this agreement, Gibraltar obtains the same rights from the United States.
The TIEA with the US entered into force on December 22, 2009.
A second TIEA with Ireland was signed in June 2009, and further TIEAs with New Zealand, Germany, the UK and Australia were signed later in the year. Gibraltar was elevated to the OECD's 'white list' of territories which have "substantially implemented" the internationally agreed tax standard in October 2009, having signed a total of 13 TIEAs.
In July 2009, at the third Ministerial Meeting of the Forum of Dialogue between Gibraltar, Spain and the UK, Gibraltar and Spain agreed to cooperate more closey with regards financial services and taxation, including the exchange of information on tax matters to aid in the investigation of tax crimes. The countries also agreed to establish liaison and exchanges between regulatory authorities, and increase cooperation on taxation and anti money laundering issues and policies.
In his 2009 budget speech, Caruana confirmed that a 10% corporate tax would apply in the jurisdiction, and that the Exempt Company regime would end by the end of 2010.
In September, 2004, a Memorandum of Understanding on exchange of information was entered into between the UK's Financial Services Authority (FSA) and Gibraltar's Financial Services Commission (FSC). The Memorandum establishes a formal basis for co-operation, including the exchange of information and investigation assistance.
The agreement commited both regulators to providing full assistance within the limits of the respective laws of the two jurisdictions, defining confidentiality constraints and setting up procedures and liaison points so that information requests can be handled speedily and efficiently.
In July, 2004, it was announced that the Malta Financial Services Authority (MFSA) and the Gibraltar Financial Services Commission had entered into a Memorandum of Understanding on exchange of information. The Memorandum was signed in Malta on June 30, 2004 by MFSA Chairman Prof. J.V. Banister and Mr. Marcus Killick, Chairman and Commissioner of Gibraltar's Financial Services Commission.
The MOU set out to establish "a formal basis for co-operation, including the exchange of information and investigative assistance in the fields of banking, insurance, investment services and the provision of professional trusteeship and company management services, and the exchange of information on supervisory practices and techniques." During Mr. Killick's visit, bilateral talks were held on how regulatory and supervisory collaboration between the two organizations may be further enhanced, including proposals for reciprocal visits by staff and other means of improving mutual understanding of the operations and supervisory techniques of the organizations.
Also in July, Gibraltar's Financial Intelligence Unit (GFIU) was formally admitted as a full member of the Egmont Group during the Group's Annual Plenary session held recently in Guernsey, further enhancing the jurisdiction's credentials in the fight against global money laundering activities. The Egmont Group, which has a current total membership of 94 countries, was established in 1995 and brings together anti-money laundering organisations or financial intelligence units from all over the world. The Group aims to improve communication and co-ordination between the various agencies.
Gibraltar first applied for membership in 1998 and whilst the GFIU was found to be fully compliant by the Egmont Group, its application was put on hold due to an objection from Spain to Gibraltar's inclusion as a full and separate member of the group. However, at a Plenary meeting of the Group held on 23 June 2004 Gibraltar was unanimously accorded full membership in its own right.