Jersey: Country and Foreign Investment
In terms of business and communications infrastructure, Jersey offers Western European standards. The business environment is particularly well-attuned to the finance sector as a result of the island's long-term policy of promoting itself as an international finance centre, accompanied by a well-developed regulatory structure, and careful supervision of incoming finance-sector businesses in order to screen out doubtful operations.
Jersey's political stability, low taxes and international credibility make it an attractive place in which to do business. However, in order to protect limited local resources, the administration does not welcome foreign-owned businesses unless they will clearly contribute to the diversity or quality of the services available on the island. Every business that operates in Jersey needs to have a Regulation of Undertaking Licence and the process takes approximately 3 weeks. A business which is planning to trade under a business name needs to be registered with the Jersey Financial Services Commission (JFSC). Restrictions on numbers of employees and the controls on residential accommodation are further ways in which the administration limits business expansion. These rules are not applied to exempt (since abolished) or non-resident companies, which are permitted to hold board meetings on the island and to have some fairly minimal administrative activities there.
By 2001, restrictive housing policies had begun to act as a serious brake on business activity, and in January 2002 the Housing Committee of the States of Jersey published a long-deferred major strategic policy report for 2002-2006, in which it called for sites for more than 1,100 new homes to be zoned in the first five years of the new Island Plan.
At the time, the Island Plan included provision for only 750 new homes, but the Committee said the larger number will allow them to provide 500 rental and 600 first-time buyer homes. Even so, said the Committee, the real shortfall in homes was probably as high as 1,450 - but it considered that development of the additional sites could be phased over a longer period than five years, thus reducing pressure on the construction industry. Alongside this more extended programme, it was considered beneficial to create a ‘residential land bank’.
"Restricting too tightly the supply of land will only have the effect of increasing land values and will ensure that any newly-rezoned sites continue to be the subject of intense speculation," warn the committee.
Pressure on the availability and price of houses continues to be one of the major constraints on development of the island's business community, with incoming managers and specialists facing dramatic restrictions on their ability to find reasonably priced accommodation, in the face of a rabidly 'NIMBY' (not in my back yard) existing population. Several banks which have relocated to the Isle of Man in recent times said that pressure on staff and property costs in Jersey had influenced their decisions.