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Gibraltar: Law of Offshore

Table of Statutes

This is a non-exhaustive list of the main Gibraltar statutes affecting offshore and non-resident business. The statutes are listed in alphabetical order – click on the statute for a fuller description of the statute, the legal regime it forms part of, or in some cases the text of the law.

Banking (Accounts Directive) Regulations 1997
Banking (Auditors and Information) Ordinance 1997
Banking Ordinance 1992
Bankruptcy Ordinance
Companies Ordinance as amended
Companies (Taxation and Concessions) Ordinance
Deposit Guarantee Scheme Ordinance 1997
Development Aid Ordinance
Financial Institutions (Prudential Supervision) Ordinance 1997
Financial Services (Accounting and Financial) Regulations
Financial Services (Collective Investment Schemes) Regulations 1991
Financial Services (Conduct of Business) Regulations 1991
Financial Services (Experienced Investor Funds) Regulations, 2005
Financial Services (Insurance Mediation) (Amendment) Ordinance 2004
Financial Services Ordinance 1998
Immigration Control Ordinance
Income Tax Ordinance 1984 as amended
Income Tax (Allowances, Deductions and Exemptions) Rules 1992
Income Tax (Qualifying Companies) Rules 1992
Insurance Companies Ordinance 1987
Limited Partnership Ordinance as amended
Partnership Act 1890 (UK)
Perpetuities and Accumulations Ordinance 1986
Private Foundation Ordinance 1999
Qualifying (High Net-Worth Individuals) Rules 1992
The Registered Trust Ordinance 1999
Trust Recognition Ordinance

EU Directives having direct effect in Gibraltar:

Directive 78/660/EEC (The Fourth Directive) as amended
Directive 83/349/EEC (The Seventh Directive) as amended

Directive 83/350/EEC (sharing of confidential banking information)
Second Banking Co-ordination Directive 89/646/EC (passporting)

In addition, the Financial Services Commission Act 2007 (FSCA) repealed and replaced the Financial Services Commission Act of 1989. The 2007 legislation, in addition to other changes, placed some of the powers previously held by the UK in the hands of the local authorities

In January, 2005, Gibraltar's Financial Services Commission welcomed the publication of a statutory review of Gibraltar's Financial Services Commission, conducted by an HM Treasury review team.

This was the third review commissioned under the Financial Services Commission Ordinance 1989, and was requested by the FSC in view of the rapidly changing regulatory environment in the United Kingdom, as the Commission is obliged by the founding Ordinance to match UK standards of supervision.

According to the FSC, four key areas of its work were considered by the review team, these being: anti-money laundering, banking, insurance and investment services.

The report concluded that the Commission's supervisory activities, for both insurance and investment services, established and implemented standards that substantially matched UK legislation and practice. Recommendations were made by the review team as to how the FSC could readily make the remaining adjustments necessary to bring it fully into line with recently introduced UK regulatory developments.

The team was also satisfied that the Commission's approach to banking supervision had succeeded in developing an effective supervisory structure that established standards which met its obligations under the Financial Services Commission Ordinance to match those required by UK legislation and supervisory practice.

Gibraltar's anti-money laundering regime was judged more robust than that of the UK in a number of areas, 'even taking into account the different risks posed by the business'.

In November 2006, the Gibraltar Financial Services Commission announced a comprehensive review of the jurisdiction's anti-money laundering measures.

The review saw the GFSC redraft the anti-money laundering guidance notes for the finance industry from top to bottom, with the proposed changes intended to clarify the existing laws while reducing paperwork and bureaucracy, and also encouraging finance industry participants to take a more active role in combating financial crime and terrorist financing.

Importantly, the revised rules aimed to bring Gibraltar into compliance with the third money laundering directive 2007 and the latest Financial Action Task Force (FATF) recommendations.

The finance industry was asked to contribute to the review process by the regulator, as part of a consultation lasting until January 1, 2007.

Commenting on the review, Marcus Killick, Gibraltar’s Financial Services Commissioner, told the Gibraltar Chronicle that there was a need to move away from a “tick and bash” approach to anti-money laundering towards a more proactive strategy that anticipates new trends, as criminals use ever more sophisticated methods and complex transactions to cover their tracks.

“It’s like a game of chess. We have to think ahead and anticipate what they are going to be doing in two moves' time," he told the paper.

In May 2007, following a review undertaken the previous year, the International Monetary Fund endorsed Gibraltar’s robust regulatory environment, according to the jurisdiction's government.

The report was the result of the visit by a team of nine evaluators from the IMF to Gibraltar in March 2006. The team conducted an extensive review of the Financial Services Commission’s regulatory and supervisory practices in the fields of Banking and Insurance, as well as a jurisdiction-wide review of the Anti-Money Laundering and Terrorist Financing Regime, which also included the FSC, as well a large number of enforcement agencies and Government Departments.

In all three areas Gibraltar was found to be meeting international standards, and was found to be ahead of many onshore - and much larger - finance centres.

However, the report made a number of recommendations for further improvements, which the government said had mostly been identified and were being actioned.

Commenting, Chief Minister Peter Caruana, who is responsible for financial services stated that: “Government is committed to continuing to pursue a policy of proper balance between demanding the highest regulatory standards from the providers of financial services and providing an attractive jurisdiction for the conduct of profitable, safe and competitive financial services."

"In this connection the Government welcomes external assessments such as the IMF Review to maintain an independent view of Gibraltar’s performance and to identify what we need to do to stay at the front of the pack as a leading jurisdiction in this ever changing industry. I congratulate all those in the Finance Centre Department, in the Financial Services Commission and in law enforcement agencies, for this excellent result from which our finance centre will benefit still further.”

 

 

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