Monaco: Offshore Legal and Tax Regimes
This page was last updated on 19 May 2020.
There is no offshore activity as such in Monaco. It is a low-tax jurisdiction for individuals (see Personal Taxation) and certain types of business activity are exempt from tax (see Direct Corporate Taxation). Generally, taxation is determined by the activities carried on by an entity and not by its corporate form.
Trusts can be formed in Monaco but only by local residents, hence the question of taxation does not arise. While no financial market can claim not to have been affected by the international financial crisis, Monaco has remained relatively untouched by events in the United States and beyond, according to Christian de Boissieu, president of Monaco's Financial Activities Audit Committee.
In 2008, De Boissieu, who is also the Deputy Chairman of the Council of Economic Analysis for the French Prime Minister, told an audience of bankers and accounting experts and key figures from within the local finance industry that he was "quite optimistic" over Monaco’s capacity to emerge from the financial crisis more or less unscathed.
It was with these words that de Boissieu opened the session to present the Financial Activities Audit Committee’s 2007 activity report on 25 September 2008. This Committee was set up in September 2007 following the approval of new laws by the National Council (Parliamentary Assembly). It is entrusted with approving, monitoring via its Inspection Unit and taking disciplinary action against the various players and financial products.
Its main task, according to the 2007 report, is “to protect investors, whilst at the same time enable financial activities and products to be developed with the focus on internationalisation and maintaining the specific features that make the Monégasque financial market attractive."
The Committee consists of eleven members, including Jean-Pierre Michau, Advisor to the Governor of the Bank of France.
While the 2007 activities were being presented, Jean Castellini, Secretary General of the CCAF, pointed out the absence of "criminal acts for which legal proceedings may be instigated". Regarding inspection missions, he was keen to add that the Committee does “not judge the pertinence of the products,” and went on to say that the "the controller is there to support the market but not promote it, even if his role does influence such promotion”.
Among its objectives, the CCAF has promised to continue signing bilateral agreements, in particular with regard to financial crime: “We are turning towards international cooperation,” concluded Christian de Boissieu. The latest agreement was signed in January 2011 with the Dutch Financial Regulator (AFM).