Guernsey Finance :: Guernsey provider announces world's first ever PCC amalgamation.
Protected Cell Compnaies are profoundly abusive, as is explained here.
But Guernsey boasts all the same:
Heritage Insurance Management Ltd in Guernsey has achieved a worldwide first by amalgamating two Protected Cell Companies (PCCs) into one.
The companies, Harlequin Insurance PCC Limited and Friary Court Insurance PCC Limited, are both insurance PCCs with 17 independently owned cells between them. Combining them creates a more efficient structure which ultimately will save money for the clients involved in the cells.
Speaking about the amalgamation, Martin Le Pelley (pictured), Compliance Officer for Heritage, said: “The amalgamation of two PCCs is not straightforward as each cell represents a separate class of share, which in turn means that all cell shareholders must vote in favour of the amalgamation in order for it to take place. Nevertheless, having achieved this milestone, we consider that the combined company will provide a more secure and efficient platform for our cell captive clients going forward.”
But I have a simple question. How do we know?
These structutres are as opaque as it is possible to get, and the whole purpose of offshore reinsurance is to get tax relief for premiums in an onshore location and accumulate those funds tax free offshore - which is a direct tax subsidy to an industry that does not need it whilst it hides behind absolute opacity in a location famed for ensuring no information is on public record.
Some disagree I know, but I do not call that a responsible business model.
Of course Guernsey law says this is legal. But then Guernsey is a secrecy jurisdiction and secrecy jurisdictions are places that intentionally create regulation for the primary benefit and use of those not resident in their geographical domain. That regulation is designed to undermine the legislation or regulation of another jurisdiction. To facilitate its use secrecy jurisdictions also create a deliberate, legally backed veil of secrecy that ensures that those from outside the jurisdiction making use of its regulation cannot be identified to be doing so.
In which case you can fairly say "so what that it's legal? The real question is whether it's ethical to trade behind a veil of secrecy of this sort?"
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Rupert, care to comment on this?
Is this ‘malicious’ reporting?
Or ‘socialist’ thinking?
Or just plain reading the facts as we know them?
Do you know?
What about you other ‘Arnald’ spies?
Care to wonder why this is news: explain to us the benefits to wider society, you know, the ones that business is suppose to help by being productive?
Or is it just nonsense to make money for a few, with a few skimming a bit, with many losing out?
Prove it.
Arnald
Frankly I’m not a huge fan of PCCs. I see their merit re funds (virtually the same as a SICAV) and for small captive insurance companies, but I find them cumbersome when used in other circumstances (which they now can be).
But I don’t think that Richard’s comments are necessarily correct. The captive insurance industry is very heavily regulated in Guernsey and I can’t see how in this instance there is likely to be any abuse.
Its merely “newsworthy” because its a merger of two captive insurance PCCs, but I’d be very surprised if there haven’t been instances of two fund PCCs merging in some way.
A non-event really. Nothing of note but equally no reason for anybody to read any more into it.
Pretty ambivalent really but as I say, I’m not generally a fan of them.