tax avoidance

Abu Dhabi proposes 50 year zero tax zone?

A report in the Khaleej Times from 1st July on proposed regulation for the Abu Dhabi Global Market hides an interesting nugget, way down in paragraph six.

A palace overlooks Abu Dhabi Yacht Club - a high roller's playground?  Image: wavejourney.com

A palace overlooks Abu Dhabi Yacht Club – a high roller’s playground? Image: wavejourney.com

“Abu Dhabi financial zone will offer a zero-tax environment for 50 years. In the launch phase, the financial hub will benefit from Abu Dhabi’s natural strength, ie private banking, wealth management and asset management and will grow according to market demand to eventually become a broad based financial hub.”

Great news for private and corporate clients who want to take a break from paying taxes, but how does this sit with the rest of the world’s focus on tax crimes? Will parking funds in the ADGM and avoiding coughing up your dues in the place you make your money be OK? Time will tell.

Abu Dhabi is a part of the United Arab Emirates, a member of the Financial Action Task Force’s regional body – MENAFATF.

 

 

Compliance Carols

This is the time of year to roll out the platitudes and look back over the past 12 months, at the high points and low points  and this blog is no exception.

2014 has been a great year for compliance, mainly thanks to the numerous investigations into rate rigging, market

Christmas Candle

Christmas Candle

manipulation and sanctions breaches which although on a global scale, have affected the Asia Pacific region.

Terrorist financing

Starting on a very sombre note, the Australian police force has arrested and charged two men with giving AUD15,000 to ISIS by funding flights for Australians who went to join the jihad in Syria. There is no evidence linking this to the tragic siege in a Sydney cafe in December, perpetrated by an apparently mentally ill man. Nor are their any direct links between that and the barbaric terrorist attack on a school in Peshawar carried out by the Taliban who murdered more than 130 people, the majority of whom were children. Who is funding the Taliban? The UK, US and foreign aid budgets have been variously named as unwitting donors. But that is all old news. Terror was still being funded in 2014.

Last Christmas I broke the law for you

BNP have claimed the top of the Christmas tree this year with their admission to breaching US sanctions on Sudan, Iran and Cuba, accepting the largest financial penalty to date issued for this type of breach, an eye watering USD8.97bn, which is roughly how much money it sluiced for sanctioned entities between 2004 and 2012. The penalty has focused attention on sanctions, and upon the intricate systems used by BNP to hide transactions.

He sees when you are grafting, he knows when you’r e on the take

Corruption gained a very high profile in APAC this year, with President Xi Jinping launching merciless attacks on former allies and fellow politicians who have skimmed from the national coffers. Although some view this as a political purge with corruption used as an overcoat, the message sent out is loud and clear: you’d better watch out, you’d better not graft.

Lonely this Christmas

Hong Kong’s Independent Commission Against Corruption officers will surely be celebrating this week  as it landed a prize scalp. A jury found HK’s former second official – Rafael Hui – guilty of accepting HK$8.5m (£700,000) from executives of the Sun Hung Kai Properties development company. The case has exposed the intricate links between the SAR’s government and powerful property developers; Hui’s case is the latest conviction. He is due to be sentenced in time for Christmas in Hong Kong’s jail, which will be a far less chilling residency than those of peers in Mainland China.

All you want for Christmas is a job in KYC

Recruitment in Asia Pacific compliance is still booming. Banks in Hong Kong are looking for lawyers to shore up their regulatory defences but all is not lost for those without a law degree. Back in August, recruiters in Singapore were crying out for customer on boarding and know your customer specialists, as well as project managers to fill posts. While the legal eagle-eye view on financial crime is still viewed as a safe bet, firms still need hands-on practitioners to do the real work.

Financially include the world

One of the biggest campaigns to gain ground in 2014 is the rally behind financial inclusion –  lead by various non-governmental organisations including the Bangkok head-quartered  Alliance for Financial Inclusion. Financial inclusion aims to provide appropriate financial services to those who are excluded from the financial sector and as a result, are at the mercy of ruthless money lenders, usurers and criminals who use exploitation – whether via labour or sex – to earn money. If you could borrow money from someone who would not try to sell you or your children into slavery, you would, wouldn’t you? If the world’s biggest banks are looking in earnest to change their reputations for the good, they could do worse than to reach out to the less profitable sections of society, who could do with some support.

12 corps avoiding… or is that evading?

To round off with some festive cheer, let’s all join in with a rousing chorus of the 12 Tax Dodgers of Christmas, 38Degrees’ reworking of a popular Xmas carol to highlight those who chose to hide their wealth rather than paying taxes in the country where they make their vast fortunes. Step up Amazon, Caffe Nero, Johnny Walker et al.

Or maybe it should be‘O come all ye shameful.’

First published on the ICA blog in December 2014.

Seychelles’ New FSA To Regulate Offshore Financial Sector

On March 1, 2014, under The Financial Services Authority Act 2013, the Seychelles International Business Authority (SIBA) FCA - MAldiveschanged its name to the Financial Services Authority (FSA), and became the regulator for offshore non-bank financial services in the Seychelles.

While the SIBA, in the past, was also a service provider and facilitated international business, the FSA represents an evolution in international financial services in Seychelles, in that the new institution will concentrate solely on regulatory matters. It will be responsible for the licensing, supervision, and development of the non-bank financial services industry, including the registration and regulation of international finance companies, foundations, limited partnerships, and trusts in the Seychelles.

The authority’s Chief Executive Wendy Pierre confirmed that the FSA has the capacity and the commitment to fulfill its mission, which is to provide a sound regulatory system in compliance with international laws and practices.

She pointed out that, while the non-bank financial services industry has meant increased knowledge and expertise in the Seychelles in professional services, such as legal, banking and accountancy, she now also looked for the development of the Seychelles’ financial sector into new areas, including Islamic finance.

The FSA has also launched its new website, and has signed of memoranda of understanding with what were described as three of its most important stakeholders – the Central Bank of Seychelles, the Fair Trading Commission and the Seychelles Investment Board.

A comprehensive report in our Intelligence Report series giving a country-by-country analysis of offshore investment funds, stock exchanges and trusts, with an analysis of the US QI regime, is available in the Lowtax Library at http://www.lowtaxlibrary.com/asp/subs_reports.asp and a description of the report can be seen at http://www.lowtaxlibrary.com/asp/description_report9.asp

Source: Tax-News

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