The introduction, with effect from 17 March 2008, of the concept of a 'Purpose Trust' into Guernsey law by virtue of the Trusts (Guernsey) Law 2007 and the repeal of Section 70 of the Trusts (Guernsey) Law, 1989 relating to liability of directors of Corporate Trustees, has resulted in a considerable amount of interest, among clients and trust professionals, regarding Guernsey as a more attractive jurisdiction for the establishment of structures using both Purpose Trusts and PTCs.
BVI Court Pitches in on Long-Running Ku De Ta Dispute: the Comingling of Arbitration Provisions, Disputes and Liquidation Proceedings
The recent decision of the BVI Court in the case of Retribution Limited v L Capital KDT Limited BVIHCMAP 2015/78 considers the availability of arbitration stays to winding-up proceedings. This articles discusses the case and its importance to the BVI as an international arbitration centre.
This chapter provides a useful overview of common issues in private client laws and regulations regarding private client work in Jersey. The International Comparative Legal Guide to: Private Client; published by Global Legal Group Ltd London.
This chapter provides a useful overview of common issues in private client laws and regulations regarding private client work in Guernsey. This article appeared in the 2016 edition of The International Comparative Legal Guide to: Private Client; published by Global Legal Group Ltd London.
Jersey's GST is a sales tax on the domestic consumption of imported and Jersey-produced goods and services, and is paid at 3% of their value at the time they are sold or exchanged. The GST regime came into effect on 6 May 2008. The regime is implemented by means of the GST Law and its subordinate legislation and is administered by the Comptroller.
Whereas many Guernsey-based employers already offer contractual parental leave to their staff, there has never been a statutory obligation to do so. The Maternity Leave and Adoption Leave (Guernsey) Ordinance, 2016 will come into effect on 1 April 2016, bringing Guernsey somewhat into the 21st Century. In a nutshell, eligible employees will be entitled to up to 26 weeks' unpaid maternity/adoption leave or two weeks' unpaid partner leave (as applicable) and will have a right to return to the same (or substantially similar) role when they return to work. In this article we summarise the main provisions and their impact on Guernsey employers.
The BVI Business Companies Act 2004 (the Act) is widely regarded as among the most modern and flexible corporate legislation in the world. It is a key reason for the BVI continuing to be the most popular place to set up an offshore holding company. To ensure that the Act retains its standing, and the BVI keeps pace with changes in international regulatory standards, a new wave of improvements have been made to the Act.
This briefing looks at the most important of those improvements.
The Licensing Assembly recently put public interest to the fore when considering an application for third and sixth category liquor licences relating to the Old Sail Loft at Gorey. A long-running application, the Assembly considered its responsibilities at the September 2015 sitting and reminded itself that it should not take account of extraneous information and must have regard to:
- the interests of the public in general; and
- the nature of the business conducted or to be conducted from the premises and the suitability of those premises for such business.
Welcome to our Financial Services & Regulatory Winter Update 2015.
In our final update of 2015, we discuss some recent cases in relation to suitability of advice, regulation of virtual currency exchangers and actions which may need to be taken in future in relation to contractual bail-in provisions. In our Spotlight this quarter, we focus on Data Protection developments.
Merry Christmas and Happy New Year from all of us at Mourant Ozannes. We look forward to seeing you all again in 2016.
The Jersey chapter of the international publication on topics relating to private clients including: tax, private wealth structures and succession.
Reproduced with permission from Law Business Research Ltd. This article was first published in 'Getting the Deal Through: Private Client 2016' (published in November 2015; contributing editors: Anthony Thompson and Nicole Aubin-Parvu, Wragge Lawrence Graham & Co LLP). For further information please visit www.gettingthedealthrough.com.
Grand Court Orders the Repayment of Redemption Monies: Preferences and Clawing Back Redemption Payments
In Conway and Walker (as joint official liquidators of Weavering Macro Fixed Income Fund) v SEB the Grand Court of the Cayman Islands has, for the first time, ordered the re-payment of redemption proceeds paid by a fund to an investor shortly before the commencement of the fund's liquidation on the basis that the payments constituted voidable preferences.
Following the Royal Court's decision in Larsen & Volaw v Comptroller of Taxes  JRC 244, Justin Harvey-Hills and Mathew Cook, Jersey's leading experts in this field and counsel in the case, examine the merits and implications of the Royal Court's dismissal of the first full judicial review application of a TIEA notice issued under the amended Taxation (Exchange of Information with Third Countries) (Jersey) Regulations 2008. They also explain why this case is headed for appeal.
Arbitration clauses and winding up petitions: The future of arbitration stay applications in the BVI
The recent decision of the BVI Court of Appeal in the case of C-Mobile Services Limited v Huawei Technologies Co. Limited BVIHCMAP 2014/0006, considered the availability of stays of winding-up proceedings based upon contracts containing arbitration clauses. This article discusses that case and its implications.
Royal Court considers the nature of tripartite relationship between trustee, manager and unit holder in a Unit Trust context
The Royal Court of Guernsey in Tranquility Holdings Limited v. Invista Real Estate Investment Management (CI) Limited (unreported judgment 38/2015) recently considered for the first time the nature and extent of the duties owed to unitholders by the manager of a Guernsey domiciled Unit Trust.
Huelin-Renouf – A case study in what can be achieved in trying circumstances when Jersey and Guernsey work together
In a great show of cooperation between the courts of Jersey and Guernsey earlier this year, the Jersey Royal Court made the novel decision to pool the assets of a Jersey company being wound up pursuant to Article 155 of the Companies (Jersey) Law 1991 and a Guernsey company leading to the best possible outcome for all creditors concerned.
A report on the on the South Square and Mourant Ozannes Litigation Forum on 4 November 2015, which addressed key developments in financial litigation and insolvency and restructuring.
The Royal Court of Jersey has recently refused an application by a beneficiary of a discretionary trust, who challenged the amount of costs and expenses agreed between the settlor and trustee pursuant to an earlier court order: In the Matter of HHH Trust,  JRC 193.
This case highlights the autonomy of trustees in exercising their discretionary powers under a trust deed where done so reasonably and underlines the limits of the Court's engagement in such matters.
A very warm welcome to the Q4 2015 issue of Mourant Ozannes Litigation newsletter. We have a number of articles from across our jurisdictions in this edition.
The Exempted Limited Partnership Law (as amended) (the ELP Law) governs the formation and operation of Cayman Islands Exempted Limited Partnerships (ELP). An ELP may be formed for any lawful purpose to be carried out and undertaken either in or from within the Cayman Islands or elsewhere.
Cayman Islands companies may be incorporated with limited liability or without limited liability. Cayman Islands law permits dividends or other distributions to be paid out of share premium, subject to a solvency test, even if no profits are available.
A regulated mutual fund must file an annual return and pay an annual fee to the Registrar. The annual fee is calculated by reference to the fund's authorised share capital. The fund's registered office in the Cayman Islands will file the annual return with the Registrar and when fees are received from the fund, pay the annual fee on the fund's behalf. The fee is due in January of each year. Late fees will be assessed after 31 March of each year.
In 2014, the Cayman Islands Government brought into force the Directors Registration and Licensing Law, 2014 (the Law). The Law provides for the registration, and in certain cases, licensing of individuals or companies appointed as directors of (i) mutual funds regulated under the Mutual Funds Law by the Cayman Islands Monetary Authority (CIMA); or (ii) companies registered as 'excluded persons' under the Securities Investment Business Law.
This infographic illustrates the results of the survey completed during the "Jersey Commercial Surveyors' & Agents' Question Time" event hosted by Mourant Ozannes' Jersey Property team on 26 November, 2015.
The Cayman Islands is one of the world's leading offshore jurisdictions. Although particularly renowned for the establishment of investment funds (both hedge funds and private equity funds), Cayman Islands entities are customarily used for transactions of all types including equity, debt and insurance capital markets transactions, in mergers and acquisitions and in joint ventures. The Cayman Islands Monetary Authority (CIMA) supervises and regulates providers of a wide range of financial services, including banking, insurance and investment management.
This briefing details how a company incorporated outside the Cayman Islands may apply to be registered by way of continuation as an exempted company limited by shares under Section 201 of the Companies Law (as amended) (the Law).
This briefing details how an exempted company incorporated in the Cayman Islands may apply to be de-registered by way of continuation pursuant Section 206 of the Companies Law (as amended) (the Law).
This table has been prepared to provide a comparison of the laws of British Virgin Islands (BVI), the Cayman Islands, Guernsey and Jersey in relation to the establishment and regulation of offshore corporate structures.
The Guernsey chapter of the international publication on topics relating to private clients including tax, private wealth structures and succession. Reproduced with permission from Law Business Research Ltd. This article was first published in Getting the Deal Through: Private Client 2016, (published in December 2015; contributing editors: Anthony Thompson and Nicole Aubin-Parvu of Wragge Lawrence Graham & Co LLP). For further information please visit www.gettingthedealthrough.com.
Mourant Ozannes recently held an Immigration Masterclass in Jersey exploring the practicalities and legalities of recruiting into the Channel Islands. See our infographic for more information.
Mourant Ozannes is one of the leading offshore law firms, advising on the laws of the BVI, Cayman Islands, Guernsey and Jersey. We have a substantial presence in each of these jurisdictions as well as offices in Hong Kong and London.
The Cayman Islands continue to be the preeminent offshore jurisdiction for hedge funds. Around 85% of the world's hedge funds are domiciled in the Cayman Islands, enabling the jurisdiction to outrank competing offshore centres (BVI, Bermuda and Jersey among them) as the top spot for hedge funds.
The Cayman Islands Monetary Authority's recently-published statement of guidance on matters of fund governance takes effect today and applies to all funds regulated under the terms of the Mutual Funds Law. The statement of guidance (SOG) follows a broad review of fund governance by the Cayman Islands Monetary Authority (CIMA) and should be read as a statement of what CIMA considers to be a baseline of adequacy as opposed to a statement of aspiration.
FATCA compliance: the Department for International Tax Cooperation of the Cayman Islands government (DITC) has released guidance notes in respect of the Cayman AEOI Portal.
The Cayman Islands Court of Appeal (CICA) has upheld the Grand Court's decision that redemption payments made by insolvent companies out of share premium to satisfy redeeming shareholders are not unlawful pursuant to section 37(6) of the Companies Law.
In so doing the CICA affirmed the narrow definition of "capital" under the Old Law, favoured at first instance, namely that capital was paid up share capital only (ie the par value of paid up shares) and not share premium (ie the amount paid on shares in excess of par value).
The Grand Court of the Cayman Islands has rejected the notion that directors of an insolvent company can apply, in the name of the company, for the company’s own liquidation absent either an express power within the company’s constitutional documents or shareholder approval. In doing so, the court has refused to follow its own earlier decision which permitted such action by directors.
Masterclass conclusions: Recruiting employees from outside Guernsey is not as difficult as people think
Guernsey's immigration and housing licence regimes can seem impossibly complex. Mourant Ozannes' Masterclass on Employee Immigration laid bare some of the myths surrounding employee immigration and provided practical guidance to employers to help navigate the maze of off-Island recruitment.
Winding up for loss of substratum: whether objects of a company are impossible or merely "impractical" - Harbinger Class PE Holdings (Cayman) Ltd
The briefing compares the laws of the BVI, Cayman Islands, Guernsey and Jersey in respect of limited partnerships.
What is a scheme of arrangement?
A scheme of arrangement (Scheme) is a court-sanctioned compromise or arrangement between a company and its creditors and members (or any class of them) in accordance with Part VIII of the Companies (Guernsey) Law, 2008, as amended (the Law), specifically sections 105 to 112 (inclusive).
A director's fiduciary duty imposes on him a largely negative obligation to do nothing which conflicts with the company's interest. However, when a director is acting in the company's interest he is expected to exercise whatever skill he possesses with reasonable care.
A scheme is a court-sanctioned compromise, arrangement, reconstruction or amalgamation entered into between a company and its creditors or members (or any class of them) in accordance with section 86 (and, for reconstructions and amalgamations, section 87) of the Companies Law (as amended). A scheme must involve an element of accommodation on each side for it to be effective as a scheme of "arrangement". There must be some sort of compensating advantage for members. The company must also be a party to the proposed arrangement.
The Contracts (Rights of Third Parties) Law, 2014 (the Law) provides a statutory
framework permitting contracting parties to allow persons who are not party to contracts governed by Cayman Islands law (or third parties), but who are expressed by the terms of the contract as benefiting under them, to enforce provisions of the contract.
Common Reporting Standard (CRS) is a global reporting standard developed by the Organisation for Economic Co-operation and Development (OECD) to facilitate the automatic exchange of financial information for tax purposes between countries that have adopted the standard. To date over 90 jurisdictions have committed to the regime, 60 of which, including the Cayman Islands, have formally adopted the CRS by signing the Multilateral Competent Authority Agreement.
On 16 October 2015, the Cayman Islands introduced The Tax Information Authority (International Tax Compliance) (Common Reporting Standard) Regulations, 2015 (the Regulations) to implement the CRS.
I occasionally wonder what we'd have done without Weavering; with so many blushes to hide and opportunities to exploit as a result of the first Weavering judgment, the past three years have been a bit of a bonanza for service providers. But the up-shot of it all is that fiduciary duties have become an industry just as much as they remain a responsibility.
The revocation of specific previous wills by general wording not valid - The Estate of Sushila Bhasin (Deceased) 
Mourant Ozannes recently acted in a case where the question arose as to whether a revocation of previous wills, expressed in general terms, by a foreign-domiciled deceased person had the effect of revoking a specific Jersey will, where this appeared not to have been the intention.
A version of this article was first published in Corporate Counsel on 28 October 2015.
You already know that a "going private" transaction is one that results in a publicly traded company ceases to be publicly traded.
This article first appeared in HFM Compliance.
Last week I had to renew my passport. The visit to the passport office was pretty straightforward: as an EU national applying for an EU passport the process was quick. I did, though, feel for the gentleman at the adjacent window who, as a non-EU national, had a more difficult time.
Last week I had to renew my passport. The visit to the passport office was pretty straightforward: as an EU national applying for an EU passport the process was quick.
The Securities Investment Business Law (as amended) (the Law) provides for the licensing and control of "securities investment business' (as defined below) carried on in, or from, the Cayman Islands. Under the Law, a person shall not carry on or purport to carry on securities investment business unless such person holds a licence granted under the Law or is exempt from holding a licence.
The Cayman Islands Litigation Department at Mourant Ozannes has recently written the Cayman Islands chapter of the Asset Tracing and Recovery Review, 3rd edition. The chapter contains a high level summary of the law relating to fraud and asset tracing in the Cayman Islands.
The BVI Litigation Department at Mourant Ozannes has recently written the BVI chapter of the Asset Tracing and Recovery Review, 3rd edition. The chapter contains a high level summary of the law relating to fraud and asset tracing in the BVI.
Commercial Litigation (2nd Edition) aims to provide a first port of call for clients and lawyers who are or may become involved in litigation in an unfamiliar jurisdiction. Each chapter is set out in such a way that readers can make quick comparisons between the litigation terrain in each country. Each chapter also provides an overview of the formalities to be expected and the procedure used in court in each of the numerous countries the book will cover, and will use a consistent format for ease of comparison.
A breadth of jurisdictions is covered in the 2nd Edition from common and civil law jurisdictions, with contributions from leading lawyers in their countries who are ideally placed to provide practical, straightforward commentary on the inner workings of their respective legal systems.
The aim of this update is to focus on current legal and regulatory developments affecting financial services institutions in Jersey and to provide some brief thoughts on the implications of these developments for your business.
Q2 this year ended with the JFSC showing its teeth in two prosecutions, AG v Fleming and AG v STM Fiduciaire and Jardine. Prosecutions instigated by the JFSC are still sufficiently rare in Jersey to cause a heightened state of tension across the local industry, especially amongst compliance professionals following the targeting of Jardine, who was an MRLO.
This update is not, however, all about enforcement action, as there are also positive developments for the industry. In particular, regarding the use of electronic apps for CDD. We have also focussed on the extension of the Discrimination Law as of 1 September 2015.
This guide contains a summary of the main requirements for the admission of quoted Eurobonds by private issuers to a primary listing on the Channel Islands Securities Exchange (CISE).
Mourant Ozannes appeared recently In the matter of the P Trust and the R Trust  JRC 196. The case demonstrates the power of the Royal Court to declare invalid the exercise of powers by fiduciaries
Following the reform of the tax rules which apply to Jersey pension schemes earlier this year, the Comptroller of Taxes published an update to its tax guidance notes for pension scheme administrators in September 2015. This note provides a summary to some of the most significant updates to the guidance notes together with a recap of the main changes which were introduced on 1 January 2015.
This Article was first published in the September 2015 edition of Private Client Business. The Common Reporting Standard (CRS) will soon be upon us. From its beginnings in 2012 as a political project influenced by the success of the United States in extending the IRS's information gathering network around the globe via FATCA, the CRS has developed at breath-taking pace for an international initiative of its size. By the end of 2015, domestic legislation will almost certainly be in place to implement it in the first jurisdictions to have accepted it (the so-called early adopters) and the first exchanges of tax information will occur under CRS in 2017. Many other jurisdictions will follow in 2018.
As a result of a recent ruling from the European Court of Justice, any data controllers in Guernsey or Jersey who transfer data to the US should urgently review the measures in place to ensure that data remains adequately secure.
Many businesses are inadequately protected against social media misuse by employees, according to a new survey conducted by Mourant Ozannes in Guernsey and Jersey. Members of the business community were polled, representing some of the largest finance, legal and media organisations across
the Channel Islands.
The Cayman Islands chapter in Sweet & Maxwell's fifth edition of Arbitration World provides a quick and easy first look at key issues in Arbitration in the format of a jurisdictional questionnaire, which should prove helpful to general counsel and their clients. Contents include a general overview and new developments; the key features of arbitration in Cayman; advice on seeking interim measure in support of arbitration claims; and the methods for challenging or enforcing arbitral awards.
The attendees at our 'Masterclass on Social Media' on 9 September 2015 completed a survey on social media usage at the Jersey businesses they work for. The results which stood out are displayed in our infographic.
The attendees at our 'Masterclass on Social Media' on 9 September 2015 completed a survey on social media usage at the Guernsey businesses they work for. The results which stood out are displayed in our infographic.
Mourant Ozannes Intellectual Property Group advises clients on all aspects of IP, for large multi-national organisations to start-up companies and individuals.
The Grand Court of the Cayman Islands (the Court) recently endorsed the test articulated in the matter of Hadar Funds Ltd (in Voluntary Liquidation) in relation to the independence or otherwise of proposed joint official liquidators, confirming that the test to be applied in assessing the independence of liquidators is whether or not the Court considers that fair minded stakeholders are justified in being reasonably concerned that the liquidators operate under a conflict of interest.
A Cayman Islands exempted company limited by shares is a flexible and versatile vehicle that can be set up quickly and is easy to maintain.
Cayman private equity funds. This briefing explains the attractions for international managers, sponsors and investors of the Cayman Islands as the jurisdiction in which to domicile a private equity fund.
This article first appeared in Connect Magazine's October 2015 edition.
On 1 September 2015, a number of family friendly rights were introduced into the Employment (Jersey) Law 2003 (the Employment Law). In effect, the amendments provide for maternity, parental and adoption leave as well as the right to request flexible working. It’s been a long time in the making and Jersey has most certainly lagged behind other jurisdictions in the provision and recognition of family friendly rights. So, is your business ready to deal with these new rights or are you concerned about the effect these rights will have on your business?
The Channel Islands of Jersey and Guernsey share a common competition authority, CICRA, but as separate jurisdictions have individual competition law regimes and apply different jurisdictional tests in order to determine whether mergers and acquisitions (and joint ventures) should be notified to CICRA for review and approval. This briefing provides a guide to jurisdictional thresholds for mergers and acquisitions in the Channel Islands.
Jersey Employment Law round up of recent case law and legislative developments.
This judgment is one of the very few Jersey cases that looks at the issue facing an employer looking to enforce a non-competition clause against a former employee.
This briefing covers the first prosecution in Jersey against a regulated business and MLRO for failing to report suspicions under the Proceeds of Crime (Jersey) Law 1999.
Enforcement of foreign judgments against BVI registered companies is a common occurrence. It is often the case that in tandem with any such enforcement proceedings, an application is made to freeze the assets of the subject of the foreign judgment. The recent Court of Appeal case of Lucita Angeleve Walton Anors v Leonard George De La Haye highlights the many issues that can arise.
The Grand Court of the Cayman Islands (the Court) recently ruled in favour of Primeo Fund (in official liquidation) (Primeo) in its ongoing representative proceedings with the Additional Liquidator of Herald Fund SPC (in official liquidation) (Herald). The Court confirmed that section 37(7)(a) of the Companies Law does not apply to investors who are redeemed pursuant to the company's articles of association, but have not yet been paid (the section 37(7) Issue).
External Confiscation Orders; Criminality to be judged at the time of application, not the time of the conduct itself
The Royal Court of Jersey recently considered for the first time the definition of "criminal conduct" with reference to the registration of confiscation orders made by foreign courts. Importantly, the Court declared that the Court should look at whether the definition is satisfied at the time the application is made to the Jersey Court, and not the time of the conduct itself.
This article considers two notable recent decisions of the Guernsey Court of Appeal and Royal Court that provide helpful guidance on the time limits within which any claim for judicial relief should be made.
Guernsey Court of Appeal considers interplay between security for costs and European Convention of Human Rights
This article considers a noteable recent decision which is the first time the Court of Appeal in the Channel Islands has considered the impact of Article 6(1) of the ECHR on the security for costs jurisdiction. This is a demonstration of the ECHR's far reaching application to matters that are merely interlocutory in nature.
A comparison of solveny voluntary liquidations of companies in the BVI, Cayman Islands, Guernsey and Jersey with a foreign company.
A comparison of mergers of companies in the BVI, Cayman Islands, Guernsey and Jersey with a foreign company.
Contractual agreements not to pursue winding up relief remain enforceable despite section 36(3) of the Exempted Limited Partnership Law 2014
In the recent decision of Re Rhone Holdings LP (Mangatal J presiding) the Grand Court of the Cayman Islands (the Court) struck out a just and equitable winding up petition (the Petition) for abuse of process. The Court held that the parties' contractual agreement not to pursue winding up relief was enforceable despite section 36(3) of the Exempted Limited Partnership Law 2014.
This article first appeared in the Jersey Evening Post on 16 September 2015.
Diversity in the workplace - an achievable goal or an ideal? Diversity in the workplace is a buzz word in today's society. The working population and workplace practices are ever-changing, resulting in many businesses reviving or rebuilding their diversity programmes or starting on the path towards creating a diverse workforce.
On the 28th of August 2015 the Grand Court of the Cayman Islands released its decision in In the Matter of Integra Group (Jones J).
This case is the first time the Cayman Islands court has ruled on what constitutes "fair value" in the context of a statutory merger under the Companies Law of the Cayman Islands (the Law).
This briefing outlines some of the key provisions of the Jersey legislation that is most likely to apply to a Jersey public company that carries on business outside of Jersey. It is intended to be a general guide for company secretaries to assist with the day to day administration of the company. Our advice should be sought in appropriate circumstances.
This briefing examines the key aspects of distributions and share purchases (sometimes referred to as share buybacks) and redemptions under the Companies (Jersey) Law 1991 (the 1991 Law).
These briefing notes have been designed as a supplement to Mourant Ozannes' client guide in relation to the Companies (Jersey) Law 1991 and subordinate legislation (the Law) to identify provisions in the Law likely to be of general relevance to administrators.
This briefing note has been prepared as a supplement to Mourant Ozannes' client guide in relation to the Companies (Jersey) Law 1991 (the "Law") to provide further details as to the distinction made by the Law between public and private companies.
Historically, the UK Panel for Takeovers and Mergers (the Panel) has regulated takeovers both in the UK and the Crown Dependencies informally through the application of the City Code on Takeovers and Mergers (the Code).
Ever since the legal concept of the company was created, there has been discussion about what the purpose is of companies and why they should exist.
A Summary of the Cayman Islands' Confidentiality Legislation.
The Confidential Relationships (Preservation) Law (2015 Revision) (CRPL) seeks to maintain the confidentiality of commercial activities which take place in or in connection with the Cayman Islands, whilst also providing for the disclosure of confidential information through designated gateways as the interests of justice require.
The CRPL sets out what constitutes confidential information, when confidential information can be lawfully disclosed with and without the permission of the Court, and what the penalties are for unlawful disclosure of confidential information.
This article was published in the Jersey Evening Post's September 2015 issue of Homelife.
When buying property, many purchasers require the assistance of a bank loan but there seems to be confusion about the process of completing the loan formalities. This article sets out the various steps, from a legal perspective, to finalising a property loan.
This article was first published in the September/October 2015 edition of BL Global Magazine.
Changes to companies law in Guernsey are set to make firms easier to incorporate and administer – and it's hoped they will give the island a competitive edge too.
This table has been prepared to provide a comparison of regimes the for private equity holding structures in the British Virgin Island (BVI), the Cayman islands, Guernsey and Jersey.
This article was first published by Corporate Rescue & Insolvency in August 2015.
An overview of insolvency in the Cayman Islands from the perspective of companies that are operating within a domestic and/or international family of companies, and considers the various complexities that this can introduce into insolvency procedures. It also has a significant concentration on duties, liabilities, insurance, litigation, and subsequent restrictions imposed on directors and officers of an insolvent company.
This article is a first-hand reference material for practising lawyers and in-house attorneys who may counsel clients on matters of corporate governance in the Cayman Islands. It is written in a reader-friendly Q&A format and covers shareholders, directors & board of directors, audit, liabilities, and social interest in corporate behaviour and provides practical, straightforward commentary and guidance to investors.
This infographic summarises the main provisions of the sex discrimination law, coming into force on 1 September 2015.
Guernsey Court of Appeal upholds finding of no gross negligence by Former Trustees of Tchenguiz Trust
We recently held our first 'Expert hour' Q & A on our LinkedIn group, in which we answered a series of frequently raised questions around the new laws coming in to force on 1 September (and there have been a few!) You can see the questions and answers in full here.
The Segregated Portfolio Company (SPC) is a single legal entity within which may be established various segregated portfolios. The assets and liabilities of each segregated portfolio are legally separate from those of the other segregated portfolios. When the SPC was first introduced in the Cayman Islands in 1998, the use of the SPC structure was restricted to licensed insurers. However, an amendment to the Companies Law of the Cayman Islands (the Law) in late 2001 removed this restriction on the use of SPCs and SPCs are now used in other sectors such as investment funds, where the protection afforded by the use of segregated portfolios is being applied to segregate share classes with different investment objectives and risk profiles.
In the latest edition of Business BVI Asia Simon Lawrenson and Danielle Roman examine why BVI buyers, lessors and financiers of business jets in the Asia Pacific market trust in “Brand BVI”.
Jeremy Wessels comments on the inherent jurisdiction of the Court to supervise the administration of trusts: R & RA Trusts for Private Client Business.
An overview of the continuing obligations of a BVI investment business licensee.
The implementation of stricter taxation scrutiny globally shows no sign of abating. Nonetheless, Guernsey is well-placed to meet many of these challenges, and indeed thrive in this new world order. Guernsey has repeatedly demonstrated an ability to comply with international obligations and adapt to challenges and changing circumstances and the evolving tax landscape is no exception. But what are the rule changes, and how are they affecting Guernsey?
The Alternative Investment Fund Managers Directive (AIFMD) has been in force for just under one year now. Its introduction on 22 July 2014 subjected fund managers based in the EU or with marketing operations in the UK and which were not regulated under UCITS to a vast array of rules and restrictions.
This article reviews Guernsey's position as a major fund domicile.
From 1 September 2015, employees in Jersey are entitled to maternity, parental and adoption leave. See our infographic for more.
The Cayman Islands court held that three separate appointments of capital from an employee benefit trust established in the Cayman Islands to three employee financed retirement benefit schemes in Jersey were void as a result of an excessive execution of powers contained in the relevant Trust deed by the Trustees and on the grounds of mistake. In separate proceedings in Jersey, the Jersey court granted recognition of the decision of the Cayman Islands court. This briefing provides further details of the decision.
This briefing examines the Jersey insolvency legislative and common law framework in the context of Jersey incorporated companies and incorporated limited partnerships. For access to this briefing, please contact email@example.com
The Royal Court of Jersey has provided some welcome clarity on the treatment of zero hours contracts in Jersey, in the case of Marchem (Europe) Limited v Carre. This briefing provides a discussion of that decision and its implications for Jersey law.
In this issue, we comment on the JFSC's new power to impose financial penalties, as well as provide a brief update in relation to some recent case law in Jersey and the UK, the latest public statement made by the JFSC, the use of mobile apps for collecting client due diligence and potential changes to Jersey's investment business regime in response to MiFID II.
In this article Jeremy Wessels reviews the evolving role of the independent director in the global market place. This article first appeared in INSOL World Q2 2015.
Jersey offers a full spectrum of fund regulation, from highly regulated recognized funds which may be marketed widely to the general public to unregulated funds which fulfil certain criteria and therefore may opt out of regulation as a fund in Jersey. This briefing is a general introduction to the range of Jersey investment funds available.
This briefing gives a summary of the key features of an expert fund.
This briefing gives a summary of the key features of a listed fund.
This briefing gives a summary of the key features of an unregulated fund.
This briefing gives a summary of the key features of a publicly-offered collective investment fund which is not an expert fund, recognized fund, listed fund or unregulated fund.
From January 2012 a new streamlined regulatory authorisation process for the establishment of privately placed funds is available in Jersey.
This briefing gives a summary of the key features of a Jersey eligible investor fund.
Head of Property in Jersey, Gavin Renault, and Counsel, Georgina Cook, discuss the increase in the number of British-based entities looking to invest in commercial property in Jersey and considerations around this.
This article can be viewed in the latest issue of Abode2, luxury property magazine.
On appeal by the bank from the decision of the Court of Appeal of Gibraltar, the Privy Council held that a bank had constructive notice of a third party's proprietary rights where it had failed to make inquiries as to the commercial purpose of a transaction.
The Companies (Guernsey) Law, 2008 (Amendment) Ordinance, 2015: Squeeze-Out Rights - Buying Out Minority Shareholders in a Guernsey Company
Late this year, the squeeze-out regime in Guernsey will be amended. This note provides a summary of the current and proposed regimes.
When taking security over shares in a BVI company it is common to take security by way of an equitable mortgage or a charge over the shares. This briefing examines the enforcement rights available to a security taker under an equitable share mortgage.
A client wishing to create a trust has to come to terms with the requirement to transfer legal ownership of assets to the trustee. In the context of offshore wealth planning, the trustee may be a service provider's professional trust company, likely to be operating in a foreign jurisdiction. If the client is concerned about taking this step, one solution may be the use of a private trust company (PTC). This briefing provides an overview of private trust companies in Jersey.
The duties of directors of companies incorporated in the Cayman Islands are governed primarily by the Companies Law (2013 Revision) (the Law) and precedents established by the common law. The Statement of Guidance for Regulated Mutual Funds published by the Cayman Islands Monetary Authority (CIMA) is also instructive for directors of Cayman Islands mutual funds. This Quick Guide provides an overview of some of the main duties of directors of Cayman Islands companies.
Earlier this year the Jersey Court of Appeal provided us with a timely reminder of the important role of a court of first instance when it comes to the assessment of the oral testimony of witnesses of fact as well as the need for parties to take great care in the wording they use in orders they seek for injunctive relief.
When it comes to the imposition of sanctions for non-compliance, the Royal Court of Guernsey is not bound by overly prescriptive rules; rather it acts to further the overriding objective, which is to deal with cases justly. Flexible it may be, but the Royal Court is no soft touch. Litigants who consistently and flagrantly flout the Royal Court's orders can be expected to be held to account. This was made abundantly clear in the recent committal ordered in the civil action of Invescap Holdings Limited v Lee Douglass (judgment 20 February 2015).
Social networking has been creating a legal storm – a storm that has been brewing for some time, but which is now starting to gather momentum. Social media has become an entrenched part of our personal and professional networking, but it brings with it risks created by the misuse of those platforms and risks attached to the ownership of those platforms. As the traditional constructs of employment law struggle to fit the square peg of social networking into the round hole constructs of statutory and common law, and as the line between what is "in the course of employment" becomes increasingly blurred, so the uncertainty increases for employers who are forced to navigate an increasingly grey area of accountability, responsibility and liability. This article intends to identify some of the issues arising and proposes means by which to mitigate those risks.
Given the international nature of BVI companies and a regular issue that arises concerning BVI incorporated companies relates to the subject of service out of jurisdiction. Given the international nature of BVI companies and the multitude of jurisdictions that can be involved in any related dispute, service out of jurisdiction and the principles that underlie it have to be correctly understood in order to ensure that litigants issue in the correct jurisdiction.
In the recent decision in Classroom Investments Inc. v (1) China Hospitals Inc. and (2) China Healthcare Inc. (Smellie CJ presiding) the Grand Court of the Cayman Islands (the Grand Court) granted the Plaintiff's application for a freezing injunction in aid of foreign proceedings in Hong Kong. It is the first order made pursuant to the recently enacted section 11A of the Grand Court Law (2008 Revision) (as amended) (the Law), which places on a statutory footing the jurisdiction of the Grand Court to grant interim relief in aid of foreign (ie non – Caymanian) proceedings.
Welcome to issue no.2 of our litigation newsletter for 2015. A selection of articles from each of our jurisdictions follows.
Our BVI team reports on clarification from the Court on service out of jurisdiction. From Guernsey, we report on the risks of social networking in the work place, penalties following the breach of Court orders and the possibility of the Royal Court imposing sanctions for the failure to engage in ADR.
Our Cayman office discusses the recent decision in Classroom Investments Inc, group insolvency and provides a quick guide to directors duties in the Cayman Islands.
Finally, our Jersey team have articles about finding litigation witnesses resident overseas and the need for parties to take great care when they seek injunctive relief.
If you have any queries in relation to any of the articles, please do not hesitate to contact me, the authors or any of your usual contacts at Mourant Ozannes.
The draft legislation amending the Companies (Guernsey) Law, 2008 has now been released. These changes are expected to be implemented into Guernsey law during the second half of 2015. This briefing provides a high level review of the proposed changes.
This guide compares certain Jersey real estate holding structures (Companies/JPUTs/LPs) and lists their respective key features.
The Grand Court of the Cayman Islands (the Court) recently ruled in favour of Primeo Fund (in official liquidation) (Primeo) in its ongoing representative proceedings with the Additional Liquidator of Herald Fund SPC (in official liquidation). The Court confirmed that section 37(7)(a) of the Companies Law does not apply to investors who are redeemed pursuant to the company's articles of association, but have not yet been paid (the section 37(7) Issue).
The Court has now handed down its detailed reasons in respect of both the section 37(7) Issue and the other matter it was asked to determine: the circumstances in which a liquidator of a Cayman company can rectify the register of shareholders pursuant to section 112(2) of the Companies Law and Order 12 rule 2 of the Companies Winding Up Rules.
Guernsey companies have continued their track record as the leading offshore vehicles for listing on the various markets of the London Stock Exchange (LSE).
A Jersey Property Unit Trust (JPUT) is a specific type of Jersey trust which is commonly used to require and hold interests in UK real estate.
Mourant Ozannes recently acted for the trustee of a Jersey law governed trust which was the subject of a court application in a case known as In the matter of the Y Trust  JRC 059. The case demonstrates the Royal Court's willingness to approve innovative means of settling family disputes concerning trusts.
Grand Court construes section 37(7)(a) of the Companies Law - redeemed but unpaid investors are to be treated as creditors
On 4 June 2015 the Cayman Islands Grand Court ruled in favour of Primeo Fund (Primeo), in the ongoing Representative Proceedings between Primeo and Herald Fund SPC (Herald). The Court had to construe section 37(7)(a) of the Companies Law. Although the Court's detailed reasons are still awaited, it is clear from the Court's decision that section 37(7)(a) does not apply to redeeming investors whose shares have been redeemed prior to the commencement of the liquidation and provides for the circumstances in which they can enforce their redemption in the liquidation.
In short, an amalgamation involves two or more companies merging to become one. Under the Companies (Guernsey) Law, 2008 (the Law), a Guernsey company can be amalgamated with one or more other companies, whether incorporated in Guernsey or overseas.
Printed in the June edition of the STEP Journal, this article discusses the jurisdictional limits of witness summonses.
This is an essential guide for those acquiring or transferring ownership of property in Jersey.
Our English clients regularly ask us the same question "What are the main differences between commercial property transactions in England and Jersey and what can we expect when we transact in Jersey?"
The British Virgin Islands (BVI) International Tax Authority (ITA) BVI Financial Account Reporting System (BVIFARS) opened on 15 April 2015. BVIFARS is the web-based application through which BVI financial institutions are required to submit their FATCA returns to the ITA.
This infographic illustrates the results of a poll conducted at "The Sex Debate" in Guernsey, hosted by the Women's Development Forum in April 2015 and debated by Mourant Ozannes. Over 100 women attended the debate.
This Briefing discusses the fast track application process introduced by the Guernsey Financial Services Commission in October 2008 for licensees associated with Qualifying Investors Funds and Registered Closed-Ended Investment Funds.
An overview of the circumstances in which a company may be struck off the Register of Companies following which it will cease to exist.
This briefing gives an overview of the methods by which a Guernsey company which has been struck off or dissolved and removed from the Register of Companies can be reinstated.
The influx of institutional money into alternative investment managers – such as private equity, hedge funds and real estate – shows no sign of abating. This growing investment into various alternative asset classes is something that will undoubtedly benefit Jersey, as a leading offshore fund domicile. In this overview of the alternatives market we look at 'why Jersey'?
Information on the types of company available in Guernsey and the process of incorporation.
Despite the widely held opinion that it is archaic and inequitable, the process of dégrèvement remains a useful option available to secured lenders seeking to recover an unpaid debt. It is a debt recovery procedure which results in the debtor's property becoming freed from all security and thereby "disencumbered". The procedure is principally governed by the Loi (1880) sur la Propriété Fonciere.
Property in Jersey can be bought or sold either by contract passed before the Royal Court (a conveyance) or by share transfer. This general guide explains the steps common to a share transfer transaction. It should be noted that any pre-contract negotiations should always be more "subject to contract" as contracts of this nature can in some circumstances be specifically enforced.
Property in Jersey can be bought or sold either by contract passed before the Royal Court (a conveyance) or by share transfer. This general guide explains the steps involved in purchasing a "flying freehold" unit.
Property in Jersey can be bought or sold either by contract passed before the Royal Court (a conveyance) or by share transfer. This general guide explains the steps common to buying and selling freehold property.
As jurisdictions, Jersey and Guernsey have a lot in common. They both enjoy a unique constitutional position and draw on mixed legal sources that stretch back to Norman customary law, incorporating civil law and English common law. In respect of property law, and commercial leases in particular, practitioners face similar challenges in both jurisdictions.
The Residential Tenancy Law 2011 (the RTL) and the amendments to it (adopted on 11 September 2012) came into force on 1 May 2013.
What do we do for our fees and how are legal fees calculated on property transactions? These are good questions and people often perceive conveyancing fees to be more expensive than they are or do not fully appreciate the true value they represent. It is the case that conveyancing fees are generally more expensive in Jersey than they are in the UK. The reason for this is that in the UK, the Government guarantees the buyer's title to the property.
The last few years have seen a plethora of articles written about the introduction of the Land Transaction Tax (LTT), the tax equivalent to Stamp Duty now payable on purchases of residential share transfer property. It has been argued by some that this tax has come at a bad time for those struggling to buy their home or climb the property ladder. However, behind the headlines lies the reality of the situation, namely that many sales of share transfer flats are in fact to "First Time Buyers" who will benefit from significantly reduced rates of LTT since the same concessions apply as to freehold transactions.
Mourant Ozannes looks at the main issues for a retailer to consider when taking on a lease in Guernsey and Jersey.
The mere mention of asbestos can set alarm bells ringing for any person with an interest in property. Mourant Ozannes property team highlight some of the key issues to consider when looking at potential obligations and liabilities in relation to a Guernsey or Jersey property in which Asbestos containing materials may be present.
Produced in April for Lexis Nexis, this article concerns the Jersey law issues concerning the enforcement of secured immovable property interests in respect of Jersey-incorporated entities (or individuals) that own immovable property located in England, and English-incorporated entities (or individuals) that own immovable property located in Jersey.
This briefing provides an overview of the main insolvency procedures available to Guernsey companies and the factors which should be considered when deciding which procedure is likely to achieve the best result for creditors.
Mourant Ozannes' contribution to the annual report, 'Fund Management', covering a British Virgin Islands analysis of law and policy.
Mourant Ozannes' contribution to the annual report, 'Fund Management', covering a Cayman Islands analysis of law and policy.
The aim of this Update is to focus on current legal and regulatory developments affecting financial services institutions in Jersey and to provide some brief thoughts on the implications of these developments for your business.
Regulatory enforcement is the flavour of the quarter with the commencement of civil penalties legislation (although not yet implemented) and a significant number of public statements being issued by the Jersey Financial Services Commission, as well as challenges to the issue of public statements proceeding through the Royal Court.
This briefing provides an overview of how The States of Jersey, through the Housing Minister, exercises certain controls over the purchase and occupation of residential property in the Island.
Group insolvency, consolidation of debts and directors' duties and liabilities in the Cayman Islands
Louis Mooney and Christopher Harlowe provide a general overview of Cayman Islands insolvency proceedings for Practical Law/PLC.
The recent Jersey case of In the matter of the Representation of C and in the matter of the Z trusts I to VII has provided some welcome reassurance to former trustees who are faced with liabilities in respect of trusts from which they have retired.
This briefing provides a concise outline of the regulation of investment funds in Guernsey and an overview of the structures available in Guernsey and their tax treatment.
In Jefcoate v Spread Trustee Company Limited the Royal Court of Guernsey considered, for the first time, the question of whether the rule against reflective loss formed part of Guernsey law and, if so, whether it applied to cases where the losses have been suffered by a company owned by a discretionary trust.
The Royal Court of Guernsey, in what is believed to be the first Channel Islands' judgment of its kind, has stated the degree of knowledge a plaintiff is required to have for time to start to run under section 76(2) of the Trusts (Guernsey) Law 2007. Such welcome clarification came in the case of Broadhead v Spread Trustee Company Limited & Ors. The judgment merits close consideration, given its importance to the Channel Islands' trust industry.
In a series of judgments the Royal Court of Jersey has considered a number of points arising from the breakdown of relationships in a quasi-partnership. The judgments concern:
(a) Whether a heated exchange in a mediation could be admitted as
evidence in subsequent proceedings;
(b) Whether a claim for unfair prejudice was made out; and
(c) How to deal with the costs, which dwarfed the value of the claim, of these proceedings.
Booth v Zenith Trust Company Limited  JRC 231: the meaning of 'fraud' for prescription purposes under Article 57 of the Trusts (Jersey) Law 1984
In an application for strike out of the Plaintiff's claims for breach of trust on the basis that these claims were time barred, the Master considered Article 57(1)(a) of the Trusts (Jersey) Law 1984 (the 1984 Law), which disapplies the usual limitation period in breach of trust actions against a trustee "in respect of any fraud to which the trustee was a party or to which the trustee was privy". The case is of interest due to the Master's consideration of the meaning of "fraud" for the purpose of Article 57(1)(a) of the 1984 Law and the subsequent application of a test which is lower than the test for criminal fraud.
This briefing discusses the recent Privy Council decision of Nilon Limited and another v Royal Westminster. This decision clarifies BVI law on the Court's powers (and limits) to rectify a company's Register of Shareholders and it re-confirms BVI law relating to the necessary and proper party requirement for service out of jurisdiction and what constitutes the appropriate forum.
This article considers recent decisions of the English and Hong Kong Courts as to whether a petition seeking the winding up of a company should be brought in the place of the company's incorporation, or the jurisdiction in which it conducts its business.
The restriction that Guernsey registered collective investment schemes are prohibited from being offered directly to the public in Guernsey is due to be lifted on 1 April 2015 following the approval of the Registered Collective Investment Schemes Rules, 2015. The removal of this prohibition should help alleviate any concern that institutions affected by the Volcker Rule would not be permitted to hold investments in Guernsey registered collective investment schemes on the basis that they are not foreign public funds.
MCC interviews Hayden Isbister and Tim Dawson on the Cayman Islands as a Jurisdiction and Mourant Ozannes' outlook for 2015.
In the recent case of Wess v Science Museum Group, the Employment Appeal Tribunal (EAT) held that by not expressly objecting to a variation in her contract and continuing to work for further nine years until her ultimate dismissal, Ms Wess had impliedly accepted the variation to her terms and conditions.
When an issue arises in the workplace, there may be a temptation to immediately engage in email communications about the matter, to initiate an internal investigation or create an audit report which runs alongside any formal process, such as a grievance or disciplinary process. To highjack a policeman's catch-phrase, employers need to be aware that anything that they write can, and will be used, against them in a Court or Tribunal.
Should it be reasonably foreseeable that a disciplinary procedure could trigger a psychiatric illness?
Employers have a general duty of care towards their employees to ensure their health and safety in the workplace and should be wary of the impact of a disciplinary procedure on the mental health of those on the receiving end. It is not unforeseeable that a disciplinary procedure might cause hurt, stress or emotional distress to the employee. However, what happens if the disciplinary procedure results in the employee suffering a far more serious psychiatric condition, such as depression?
The long running battle of Microsoft against the US government involving a FBI User Information Request is set to cause waves in data protection and privacy circles when it is eventually determined. The focus on where a business "controls" data (ie in this case, the US) rather than the actual location of the data (ie in a cloud based from a server in Dublin) may well change the legal landscape of cloud data processing forever.
The Special Trusts Alternative Regime or "STAR" is a creature of statute. It was introduced in the Cayman Islands by the STAR Law in 1997 but since then, has been incorporated in Part VIII of the Cayman Islands Trusts Law, appearing in the 2009 Revision at sections 95 to 109.
The Cayman Islands Court of Appeal has handed down its long-awaited decision regarding the appeal brought by the directors of Weavering Macro Fixed Income Fund Limited against the Grand Court's 2011 judgment.
A creditor who obtains a Cayman Islands judgment against a debtor for the payment of money has a number of options to enforce that judgment and to recover the outstanding moneys. This quick guide sets out the main methods of enforcement.
Re Danka Business Systems Plc; Ricoh Europe Holdings BV & Ors v Spratt & Anor  EWCA Civ 92 (CA 19 February 2013)
The English Court of Appeal ruling in Re Danka Business Systems Plc (Re Danka) considers how insolvency practitioners ought to deal with contingent claims. The ruling in Re Danka represents a divergent approach to that currently found in the Cayman Islands' case law, most recently in Re Sphinx. More specifically, Re Danka supports the contention that a reasonable estimate must be made of any contingent creditor claims in order that an appropriate reserve may be set aside and ring-fenced. Conversely, in Re Sphinx, the Chief Justice concluded that any reserve was to be set at the maximum sum which might reasonably be incurred rather than the sum likely to be incurred.
This briefing provides an introduction to the factors that determine whether a Jersey insurance business transfer scheme is required and an outline of the procedure for the transfer of insurance business in Jersey.
Mourant Ozannes & South Square Litigation Forum 2014: Lehman Brothers six years on - where are we now?
Mourant Ozannes and South Square Chambers hosted their latest joint Litigation Forum in London on 11 September 2014.
The Royal Court in Jersey has recently delivered a landmark judgment in which it was held that a businesses' client contact information, stored on a database such as Microsoft Outlook is protected by laws of confidentiality and copyright, even if a client's contact details are readily available on the internet or social media sites; however, the Court held that the same protection could not extend to an employee's LinkedIn account, even though that account was a premium account paid for by the business and accessed via a business email.
In Stichting Shell Pensioenfonds (the Appellant) v Krys and another (the Respondents), the Privy Council considered the question of whether, when a company is being wound up in the jurisdiction where it is incorporated, an anti-suit injunction should be issued to prevent a creditor or member from pursuing proceedings in another jurisdiction which are calculated to give them an unjustifiable priority.
Breach of Duty by Director of a Cayman Fund - The Path to Investor Relief in the Cayman Islands vs New York
Where the circumstances exist for a shareholders' winding up, liquidation provides the most complete path to recovery of compensation for the fund, and if solvent, its investors, for the breaches of duties owed to it by its directors and service providers. Winding up a fund is, however, not always seen as a viable option. This article examines the path to investor relief under the laws of the Cayman Islands and New York.
The recent case of the Guernsey Court of Appeal in Helen Litchfield v the Director of Environmental Health and Pollution Prevention provides guidance on the procedure to be adopted in judicial review cases in Guernsey.
On 11 September 2014 the Guernsey Court of Appeal affirmed the Royal Court judgment which outlined the test to be applied in determining whether a person should be added as a party to existing proceedings.
In Burry v Knight Limited & Another v Knight  the English Court of Appeal held that pursuant to Section 117 of the UK Companies Act 2006 access to the register of members did not have to be given if one of the purposes of the request was not a proper one. This article discusses the judgment and its implications for Guernsey.
The Guernsey Commerce and Employment Department has issued a Consultation Paper seeking proposals for the reform of Guernsey's personal and corporate insolvency laws.
Changes to The Income Tax (Jersey) Law 1961 will simplify the Jersey tax rules which apply to pension schemes from 1 January 2015.
In our last Update of 2014 we consider recent Jersey cases, the forthcoming introduction of civil penalties and the Channel Islands Financial Services Ombudsman, as well as thinking about JFSC on-site examinations.
Suspicious? Be careful who you tell! A summary of recent changes to the 'tipping-off' offence under Jersey law
This article summarises the recent changes to the Jersey 'tipping off' offence under the Proceeds of Crime Law.
A summary of the Limited Partnership (Guernsey) Law, 1995 as amended.
A new exemption from the Financial Services (Jersey) Law 1998 (the FS Law) has been introduced for regulated hedge fund managers who want to operate managed accounts for their non-fund clients alongside their fund clients. Under, this exemption, fund managers may offer discretionary investment management services to certain 'qualifying segregated managed accounts' without needing an additional 'investment business' licence under the FS Law.
The Grand Court (Amendment) Law 2014 introduces much anticipated legislative clarification of the law providing for interim relief in aid of foreign proceedings.
Cayman Court Clarifies the Law on Claw-Back Claims - RMF Market Neutral Strategies (Master) Limited v DD Growth Premium 2X Fund (in official liquidation)
A recent Cayman judgment marks another set back for attempted claw-back claims by liquidators of insolvent Cayman funds against redeemed investors.
The Court has considered section 37(6) of the Companies Law, which renders certain redemption payments unlawful when made by insolvent companies. It has determined that section 37(6) does not apply to payments out of share premium. Most Cayman funds normally operate with low nominal capital and high share premium. Therefore, this decision significantly reduces the number of payments made by Cayman funds that could be rendered unlawful by this section.
This briefing sets out some of the key advantages to using a Guernsey foundation for charitable purposes, and some of the unique aspects of Guernsey law.
The 'last straw doctrine' is a well-known employment law concept normally associated with employee claims in constructive dismissal ie "I had no choice but to resign" arguments. However, in the recent case of Kearns v Glencore UK Limited  EWHC 3697 (QB), the High Court held that the doctrine was equally applicable to employers. This is a landmark ruling and, theoretically, now puts employers and employees on an equal footing.
On 18 July 2014, the States of Jersey passed the Charities (Jersey) Law 201* (the Law). It will, after it has received Privy Council consent and been registered by the Royal Court of Jersey, be a quantum leap forward in the development and clarification of many aspects of the law relating to charities and their regulation in Jersey. Some aspects of the Law will also touch upon foreign charities raising funds in Jersey. In this briefing, we provide a round-up of the key features of the new law.
In this Update, we look at some valuable lessons learned for all financial services businesses from recent JFSC examinations and investigations, as well as amendments to the Companies (Jersey) Law.
A comparison of the applicable limitation/prescription periods in the BVI, the Cayman Islands, Guernsey and Jersey.
The Jersey Court of Appeal has delivered an important judgment with regards to future planning in the island in the case of Minister for Planning and Environment & Fairmans v Hobsons.
A consideration of tax information exchange agreements (TIEAs) in the BVI and information that can be requested thereunder.
A consideration of the difficulties of enforceability of employee post-termination restrictive covenants and the enforcement of valid restrictive covenants, with a focus on recent case law.
Remuneration of Voluntary Liquidators where the Company subsequently goes into Insolvent Liquidation
A review of recent BVI case law concerning the approach to be adopted in fixing the remuneration of voluntary liquidators where a company enters insolvent liquidation.
A review of a recent Guernsey Court of Appeal case which confirmed that the Guernsey Royal Court has the power to require beneficiaries to provide information to trustees under section 69 of the Trusts (Guernsey) Law, 2007.
Guidance for those receiving requests for confidential information from authorities which are bypassing recognised TIEAs and seeking to engage directly with offshore structures.
A consideration of a recent Guernsey judgment in respect of an Administration Order, pursuant to the administration provisions of the Companies (Guernsey) Law, 2008, which provides insight as to how administration applications are treated by the Guernsey Courts.
A discussion about the application of the doctrine of marshalling, a form of equitable relief based on the principle that a creditor who has recourse to a number of sources to satisfy his debt should not disadvantage another creditor who only has access to one of those sources, and its application in commercial situations.
A review of Jersey case law in relation to mistaken dispositions of property to a trust, and when these may be set aside as invalid, with a focus on the current state of the law and appropriate remedies.
A review of recent case law in Jersey concerning whether or not a confiscation order made against a criminal and sought to be enforced from another jurisdiction could be granted over the assets of a discretionary trust on the grounds that the offender is a beneficiary.
A review of the Jersey Court of Appeal decision in Crociani in respect of forum and consideration of its impact on both the effect of an exclusive jurisdiction clause in a trust instrument and the test for permission to appeal from all future decisions of the Jersey Royal Court.
The Royal Court of Jersey considered in this case the nature of the role of a trustee and manager of a unit trust, together with the duties and obligations on each and the potential liability from successor trustees and managers.
In this case the Royal Court of Jersey concluded that it has power under its inherent jurisdiction to sanction a compromised settlement of litigation reached by the Plaintiff, on behalf of a minor, and provided helpful guidelines in relation to what the Court would expect to see to enable the Court to sanction a settlement on behalf of a child living in Jersey.
In Guernsey, proceedings to enforce a general bond, judgment debt or other security registered against a property are known as Saisie and typically result in an order vesting all real property owned by the debtor into the creditor.
Getting It Right: How to Make a Successful Application for the Appointment of Provisional Liquidators
In this recent High Court case, Norris J clearly sets out the principles to be considered by the Court when deciding an application for the appointment of provisional liquidators, including the specific considerations which will apply when such applications are made without notice.
Tantular -v- AG: Royal Court in Jersey provides clarification as to the impact of saisies judiciaires on discretionary trusts
The Royal Court in Jersey has recently determined that a saisie judiciaire may not be granted over the assets of a discretionary trust merely on the grounds that the offender (or suspected offender, as the case may be) is a beneficiary. Whilst the Court acknowledged that there were some instances in which a saisie judiciaire would have an impact on a trust, in Tantular -v- AG  JRC128, the Court held that a saisie judiciaire which froze an entire Trust, to the detriment of the other, innocent beneficiaries, would be both prejudicial and disproportionate. The Court also stressed that a beneficiary's interest in a trust and corresponding right to trust property is no more than a mere right to be considered as a recipient of benefit.
The appeal mechanism relating to TIEAs has changed substantially over the last year. This case is the first appeal under the new 'Judicial Review' regime. Whilst the challenge failed, it raises some interesting questions for future challenges.
Private Equity Funds Made Easier in the Cayman Islands (Revisions to the Exempted Limited Partnerships Law)
Private equity funds are set to benefit from updates to the Cayman Islands Exempted Limited Partnership Law. The Cayman Islands has once again shown itself to be an innovative and responsive jurisdiction in terms of providing user-friendly and practical legislation. The Exempted Limited Partnership Law, 2014 will come as a welcome relief to an industry post-global financial crisis otherwise suffering from a severe case of "regulatory fatigue".
A long-anticipated overhaul of the Cayman Islands Exempted Limited Partnership Law was enacted by the Cayman Islands Government on 2 July 2014. Changes have been introduced to simplify, clarify and add flexibility to the establishment and ongoing operation of Cayman Islands exempted limited partnerships.
This article discusses the limitation of ancilliary relief in the BVI in aid of foreign proceedings, following the recent case of VTB Capital PLC v Nutritek International Corp (103 of 2013).
An investigation of antecedent transactions during the course of the winding up of a company, with a focus on preferences given by companies and transactions at an undervalue.
This article discusses the long awaited Arbitration Act which is due to come into force in the BVI in the near future.
This article discusses the recent decision of the Guernsey Royal Court in Jackson v Dear, which provided clarity to derivative claims in the context of Guernsey company law.
This article looks at the implications for a trustee in Jersey faced with the difficult situation where it is suspected that trust assets may be, or indeed have been confirmed as being, the proceeds of crime and/or a civil fraud.
The Contracts (Rights of Third Parties) Law 2014 is now in force in the Cayman Islands. For the first time, parties to a contract will be able to give other entities who are not direct parties to that contract the ability to enforce rights expressly granted to them in the contract.
How recent cases demonstrate the pragmatic approach the Jersey Court is adopting in order to apply laws with ancient origins to modern problems in the context of Jersey insolvency law.
This article discusses the remedy of rectification in the trusts context in the Cayman Islands.
This article looks at a number of decisions in a recent Guernsey case dealing with recognition and assistance to foreign insolvency practitioners, receivers and government agencies to examine how the Guernsey Court is approaching its role in assisting these foreign parties.
This briefing sets out the procedure for enforcing Jersey and Guernsey security interests taken under the Security Interests (Jersey) Law 1983 (the 1983 Law) and the Security Interests (Guernsey) Law 1993 respectively and some of the main legal factors that should be considered when dealing with enforcement.
The Exempted Limited Partnership Law, 2014 was enacted on 2 July 2014. The changes in the new law are designed to confer greater contractual flexibility upon partners and to address uncertainties or deficiencies in the previous law that reduces the attractiveness of Cayman Islands exempted limited partnerships.
Significant changes to the Companies (Jersey) Law 1991 will come into force on Friday 1 August 2014 bringing greater flexibility to those using Jersey companies.
The aim of this Update is to focus on current legal and regulatory developments affecting financial services institutions in Jersey and to provide some brief thoughts on the implications of these developments for your business.
In this Update, we look at current consultations on civil penalties and changes to the Money Laundering Order. Our Spotlight article considers changes to the tipping-off rules which are coming into effect shortly.
The Cayman Islands is generally regarded as one of the top international financial centres in the world. At the end of December 2013, there were 213 licensed banks in the Cayman Islands headquartered in 45 different countries. The number of licensed banks in the Cayman Islands has fallen steadily during the past 10 years (from 382 in 2002). The Cayman Islands Monetary Authority (CIMA), which acts as the banking regulator in the Cayman Islands, reports that at June 2013, the Cayman Islands ranked sixth internationally based on the value of cross-border assets, and fifth internationally based on the value of cross-border liabilities, highlighting the role of the Cayman Islands as a financial intermediary.
In previous editions of this review, the Jersey chapters have recently started with reference to global financial turbulence and it is tempting now, as the economic situation has become much more stable, to put that behind us. But, while the worst of the volatility may be over, we are clearly not yet out of the woods, as the general trend in the Jersey banking sector could still be said to be one of contraction. 2013 saw a significant reduction in bank deposits and a continued decrease in the number of people employed in banking in Jersey; however, the banking sector still accounts for over three-quarters of net profits in Jersey’s finance sector and so remains a solid foundation for future growth and development.
A summary of the continuing obligations for BVI private and professional funds.
The Investment Business (Approved Managers) Regulations, 2012 (the Approved Manager Regulations) provides an attractive "regulatory light" option for qualifying investment managers and advisors. The application process under the Approved Manager Regulations is generally quick and straightforward making it an appealing and popular option for both start-up and existing qualifying investment managers and advisors.
This briefing is intended to provide an overview of Investment Funds in the British Virgin Islands.
On 16 April 2014, the Judicial Committee of the Privy Council handed down its decision on the trial of certain preliminary issues in the claims brought by Fairfield Sentry Limited against invesotrs and former investors who had redeemed some or all of their investments before the fund was placed into liquidation. The Privy Council ruled in favour of the investors, preventing Fairfield Sentry Limited from pursuing those claims.
The Court of Appeal has ruled, for the first time, that it has the power to make an order for an interim payment on account of costs. As well as clarifying whether it had the power to make such an order, the court also discussed whether a presumption to do so exists as a matter of principle, and suggested certain revisions to both the Court of Appeal (Civil) Rules 1964 and to the Royal Court Rules 2004.
On 7 April 2014, the Jersey Court of Appeal delivered its judgment in the case of Crociani v Crociani. In a landmark ruling that will have far-reaching implications for contentious and non-contentious trust lawyers in both the onshore and offshore worlds, the Court of Appeal has clarified what is meant by "exclusive jurisdiction" and "forum for administration" in trust deeds, and in doing so overruled its previous decision in the 2002 case of Koonmen v Bender.
Cayman Court of Appeal clarifies the scope of the international cooperation provisions of the Companies Law
In a judgment delivered on 16 April 2014, the Cayman Court of Appeal has ruled that the Cayman Court has jurisdiction under sections 241 and 242 of the Companies Law to apply transaction avoidance provisions of Cayman Islands insolvency law (but not foreign insolvency law) in aid of a foreign insolvency proceeding.
The decision turns on the construction of the relevant sections of the law, rather than the facts of the individual case. For that reason it is likely to have wide ranging ramifications as a binding precedent.
Norwich Pharmacal relief - obtaining information relating to a BVI company from its registered agent
Little information is publicly available about BVI companies and there is no procedure for pre-action disclosure in the BVI. However, where a BVI Company can be linked to fraud, it may be possible to obtain a Norwich Pharmacal order against the registered agent of that company, compelling it to disclose relevant information.
Jersey limited liability partnerships (LLPs) can now be licensed to conduct 'fund services business' as a general partner, manager, investment advisor or investment manager under Jersey's financial services legislation.
The aim of this Update is to focus on current legal and regulatory developments affecting financial services institutions in Jersey and to provide some brief thoughts on the implications of these developments for your business.
In this Update we've considered the Jersey Financial Services Commission's Revised Codes of Practice, as well as the forthcoming Financial Services Ombudsman.
An overview of Guernsey's limited liability partnerships law.
In this case, the Royal Court of Jersey confirmed the decision of the Master of the Royal Court to strike out a claim on the basis of delay in progress of the claim. The Court considered Human Rights arguments and the balance on the obligations of Plaintiffs and Defendants, and determined that a fair trial was not possible because of the delay.
Guernsey: All potentially interested parties to be considered by the court when blessing a decision of trustees
In a decision which provides useful guidance for both trust and insolvency practitioners, the Guernsey Court of Appeal has upheld a decision of the Royal Court blessing a trustees' decision to pay for the costs of refinancing a trust asset from the assets of a family trust. One of the key grounds of appeal concerned the solvency of the trust and more particularly, that because it was insolvent, the Court lacked the jurisdiction to bless a decision proposed by the trustees. But the Court of Appeal unanimously held that the potential insolvency of the trust was not a bar to the court's supervisory jurisdiction and that the interests of all those who may be interested in the assets of the trust had to be considered.
A discussion of the Guernsey Court of Appeal's decision in Propinvest Group Limited (In Administration) v Glenn Maud as to when a judgment is pronounced.
Costs of trustees and beneficiaries: Trilogy v YT Charitable Foundation (International) Limited  JCA 204
An examination of the principles relating to costs in non-adversarial trust proceedings.
In Re C (a Bankrupt) BVIHC 0080/2013: Common Law Recognition of a Foreign Bankruptcy Trustee in the BVI
In Re C (a Bankrupt) BVIHC 0080/2013 Mr Justice Bannister QC allowed recognition of a foreign bankruptcy trustee in the BVI.
A discussion of a recent decision of the Guernsey Court of Appeal in which an asset restraint order was reinstated over the assets in a trust.
A "Tax Information Exchange Agreement" (a TIEA) is an agreement between two jurisdictions which sets the basis for co-operation between those jurisdictions by way of mutual exchange of information to assist both civil and criminal tax investigations. Jersey has approximately thirty currently in force, with more in various stages of negotiation and agreement.
Discussion of the Decision of the Guernsey Court of Appeal which highlights the potential repercussions for banks and financial institutions in reporting suspicion and a resulting refusal of consent by the FIS.
One of the factors that makes the BVI an attractive place in which to incorporate a private holding company is that a BVI company may keep documents and information about its ownership, management and financial affairs confidential. Although confidentiality is desirable from the company's perspective, it means that only limited documents and information about the company is publicly available. This briefing examines the documents and information about a company (that is not a regulated person) that a third party can get from public and third party sources.
What is the role and function of the Royal Court of Jersey in trustee applications for directions regarding disclosure of trust information?
In December 2013, the Royal Court of Jersey blessed the decision of the trustee of the Y Trust to refuse disclosure of information concerning the Trust to the first respondent in her capacity as former beneficiary of the Trust (In the matter of the Y Trust  JRC 027). The application raised the issue of the function of the Court, namely whether the Court was exercising its own discretion in supervising, and where necessary, intervening in the administration of a trust, or, on the facts of the case, giving its blessing to the proposed exercise of the trustee’s discretion.
Calling time: Royal Court clarifies limits of customary law exception in respect of time barred breach of trust claims brought by incoming trustee
In Michaela Walker & Ors v Paul Egerton-Vernon & Ors  JRC 025, the Jersey Royal Court has ruled that, where a newly incorporated private trust company (PTC) recently appointed as successor trustee seeks to bring claims for breach of trust against predecessors, it will not be able to benefit from the Jersey law doctrine of empêchement d'agir (which can stop the limitation clock from running in situations of practical impossibility) where it was not in existence at the time that the deadline for bringing claims had expired.
Update: Direct disclosure obligations resulting from the joinder of adult beneficiaries to matrimonial proceedings affecting trusts - Tchenguiz-Immerman -v- Immerman
The English Family Division orders disclosure by beneficiaries of documents relating to private trustee proceedings to which they were convened.
A BVI business company is perfectly suited to venture capital series A preference share financings, offering essential flexibility.
Jersey has its own legal system and is a separate jurisdiction from that of England and Wales. The conflict of laws principles applied in Jersey do, however, closely follow the common law (ie non-statutory) principles applied in England and Wales.
After many years in the pipeline, the draft Financial Services Ombudsman (Jersey) Law 201- has been lodged for debate in the States of Jersey. The draft law and a report in relation to the introduction of the Financial Services Ombudsman for Jersey (or the Channel Islands) is available on the States Assembly website. We set out a short summary of the proposals in this briefing.
The BVI Business Companies Act 2004 (the Act) allows a foreign company to continue its existence as a BVI company incorporated under the Act. This process is sometimes referred to as a corporate migration, redomiciliation or transfer of place of incorporation. This briefing examines the continuation by a foreign company into the BVI under the Act.
One of the factors that makes the BVI an attractive place in which to incorporate a company is that the BVI Business Companies Act 2004 (the Act) is very flexible and is not overly prescriptive. This briefing examines the documents and records that a company must keep under the Act. It assumes that the company is a company limited by shares, has registered shares and is not a regulated person.
An overview of the new Security Interests (Jersey) Law, summarising the methods for creating a security interest under the new law, its key features and some matters for secured lenders to consider.
A table summarising the key differences between the old Security Interests (Jersey) Law and the new Security Interests (Jersey) Law in relation to the creation of security over Jersey intangible movable property.
The Jersey Financial Services Commission has published a guidance note relating to insurance business transfer schemes under the Insurance Business (Jersey) Law 1996, which are equivalent to Part VII transfers in the UK. Until now, there has been no published information from the JFSC in relation to such schemes for the transfer of insurance business carried on in or from within Jersey. For more information, see our briefing on the subject.
This chapter provides a useful overview of common issues in private client laws and regulations regarding private client work in Guernsey. This article appeared in the 2014 edition of The International Comparative Legal Guide to: Private Client; published by Global Legal Group Ltd London.
This chapter provides a useful overview of common issues in private client laws and regulations regarding private client work in Jersey. The International Comparative Legal Guide to: Private Client; published by Global Legal Group Ltd London.
Limitation periods in the BVI are imposed by statute, namely the Limitation Ordinance 1961 (the Law). The Law prescribes time limits within which a claimant must commence proceedings. There are different limitation periods for different types of claims.
The basic time limits for various claims are set out in Part II of the Law; however, Part III of the Law contains exclusions and extensions to the ordinary time limits, eg, in cases of fraud or mistake. Thus, when considering whether to commence any type of claim, it is advisable to obtain legal advice as to when any relevant limitation period started to run and whether it has expired. If a claim is not brought in time, the defendant(s) will be able to plead limitation, which, if established, will provide a complete defence to the claim.
Mourant Ozannes' contribution to the annual report, 'Right of Publicity', covering a Guernsey analysis of law and policy.
This article was written by Conrad Griffiths of Griffiths & Partners and Morven McMillan or Mourant Ozannes and first appeared STEP Journal's Trust Quarterly Review in December 2013.
The start of 2014 brings a number of important Jersey regulatory developments, the most notable being the commencement of the new Security Interests (Jersey) Law 2012 (2 January 2014), the JFSC’s Review of Financial Advice (RFA) (1 January 2014) and the JFSC’s Revised Codes of Practice (expected to be published in January 2014 and to become effective on 1 July 2014). We understand that progress is also being made towards establishing the Channel Islands Financial Services Ombudsman in 2014. In this Update we've highlighted points which it would be useful to think about in relation to these developments and others. Our Spotlight feature this quarter considers recent developments in relation to Tax Information Exchange Agreements (TIEAs).
We hope you find our Update useful.
Guernsey was the first jurisdiction to introduce the concept of a protected cell company (PCC) through the enactment of the Protected Cell Companies Ordinance, 1997. That Ordinance has however since been replaced by the Companies (Guernsey) Law, 2008 (the Companies Law) which has effectively modernised Guernsey company law with effect from 1 July 2008.
This briefing examines the evolution of the Hastings-Bass principle in Jersey up to and including the adoption by Jersey of statutory provisions to give statutory force to the rule in Re Hastings Bass in response to the Supreme Court's decision in Pitt v Holt and Futter v Futter.
Featured in iGaming Business Magazine's European focus and first published in November 2013, Sandra Duerden and Christo Van der Spuy look at the ecommerce opportunities afforded by the Channel Island of Alderney.