BVI Defends IFCs Against Criticism
by Mike Godfrey, Lowtax.net, Washington
08 February, 2017
The British Virgin Islands' London Office Director, Benito Wheatley, has defended the role of international financial centers at a recent conference on International Financial Services and Small States.
He said small jurisdictions should not be pushed to the margins of international finance where they would effectively be cut off from legitimate high-income generating economic activity.
"A proper balance must be found on international regulatory reforms, which does not arbitrarily impede small state [international finance centers] from engaging in high income economic activity of which they have limited options," Wheatley said.
His comments were made a during a high-level panel discussion on international tax reform. Other panelists included Barbados Minister of International Business Donville Inniss; OECD Global Forum Head of Automatic Exchange of Information Radhanath Houseden; Commonwealth Economic Advisor Lucas Rutherford; and Attorney Fran Hendy.
Wheatley highlighted the valuable services offered to the international business community by international finance centers (IFCs) in small jurisdictions, such as the British Virgin Islands. These include respected courts, the practice of English common law, and the availability of legal expertise and professional services.
"There must be recognition of the value many small state IFCs provide in terms of legal certainty, and flexibility of corporate structures that make cross-border investment possible, professional expertise, tax neutrality, lower charges to investment capital, and so on," he said.
Wheatley emphasized that in a globalized world economy where the distribution of investment capital is uneven among countries and regions, the British Virgin Islands and other IFCs in small jurisdictions provide the corporate vehicles that offer certainty, through which foreign direct investment can be channeled to developing countries to stimulate economic growth and development.
Wheatley added: "The value of the services provided by IFCs in small states in the global financial system and their utility in the world economy should be considered by the relevant international bodies and economic partners to fall within the scope of legitimate economic substance."
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