Senator Philip Ozouf, the Jersey Finance Minister, has tellingly revealed the real nature of the political situation in Jersey. In his response on his blog to the interview elected Jersey Deputy Montfort Tadier (the equivalent of an MP) had with a French newspaper Ozouf said:
Deputy Montfort Tadier this week gave an interview to a leading French Newspaper, Le Parisen effectively denouncing Jersey and its Finance Industry.
It is a matter of great regret that Deputy Tadier has chosen to express these views.
Political debate is healthy and in a democracy we are all entitled to have and respect different views. However, Deputy Tadier's remarks if accurately quoted cross the line of what is appropriate behaviour for a politician elected to serve the people of Jersey.
He added:
This article was extremely damaging to Jersey. If the article quotes are true the interview is a relentless assault on Finance in Jersey. His remarks cast a dark shadow over Jersey and Finance Services which is portrayed wrongly in the worst possible light.
What does Ozouf take objection to? Amongst the claims he says Tadier got wrong is the fact that there is any tax evasion on Jersey. Ozouf says:
Tax evasion is illegal in Jersey.
His emphasis! Well, that settles it then. It's illegal so of course it doesn't happen.
And that's about as sophisticated as he gets in his blog, so trite is his analysis, which as I've shown is also, quite simply, factually wrong.
And yet in this diatribe there are several very clear messages. The first two are reflected in this comment:
I call on Deputy Tadier to withdraw his remarks to Le Parisen and apologise to the people he represents.
So firstly, Montfort Tadier must not tell the truth. Clearly that's not allowed in Jersey, whilst misrepresenting the truth about trusts is.
Secondly, only one view is allowed: Jersey is finance and finance is Jersey and anyone who says otherwise is failing the place and must apologise.
In both cases it's clear that a single party state is what Ozouf believes does, and should exist. But that's, perhaps, most tellingly portrayed in this comment in which he refers to this television interview:
Yesterday, I was asked to do an interview with ITV Channel Islands, which I agreed to do a head to head with Deputy Tadier. I was placed in an extremely difficult position of having to attempt to counter Montfort Tadier's comments without any intervention with from the journalist. I will be taking this up with CTV as I would expect a professional interviewer to have intervened and actually challenged both sides.
There was not a hint of bias in the interview: Channel TV left two politicians to debate an issue. And what is clear is that Ozouf did not like that. In his opinion the press must fawn to and support his view. They didn't; they let him face an opponent without their protection and that is something he is totally unused to, and he's going to complain as a result.
In the totalitarian world of Ozouf and his cronies, supported by the finance industry in Jersey, opposition is not allowed. I applaud Montfort Tadier for having the courage to stand up to this abuse of democracy, of the freedom of speech, of the truth and for naming Jersey for what it is - a place that creates structures designed to undermine the tax system of other states. No wonder Ozouf does not like it - he's been rumbled.
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Jersey is a one party state; the name of that party is Finance.
Oh Richard, you really do need to make that visit to the Isle of Man and have your eyes opened properly as to how a Tax Haven operates. With our own laws and occasionally grotesque system of justice there are things happen here that Robert Mugabe can only dream of.
Anyway, nice to see there are certain parallels between the Channel Islands and our own, at times, rather grubby British protectorate. Yep, we are not alone.
Richard,
You quote Ozouf in his blog as saying:
“Tax evasion is illegal in Jersey.”
Well, yes, if a JERSEY resident tries to evade tax, then it is illegal, and that person may end up in court if they are found out. (In fact Jersey has a very good GAAP in law, so even tax avoidance does not get a look in)
But if a FOREIGN person takes steps, using vehicles established in Jersey under Jersey law, to not pay tax which is due IN THEIR OWN COUNTRY, is that covered by Ozouf’s declaration?
I just do not see how Jersey could prosecute a foreign national for doing this.
I think a comment on his blog is called for.
Officially that is illegal under Jersey’s money laundering regulations
I bet it has never been investigated, let alone prosecuted
Rumbled and owned, Tadier pasted him with facts, Ozouf just spouted guff with no substance and when he got tired of repeating himself he asked for it to end. Priceless failure by Ozouf.
Agreed
Commemnt posted to Ozouf’s blog. Now we will see…
It is a shame that you have to resort to making personal insults like ‘Ozouf and his cronies’ yet I guess that is the only way you can prop up your flimsy argument. One thing is for certain, Jersey’s Trust Law is here to stay no matter how you wish to translate it.
In which case the description seems entirely apt
By the way James,
Those crony Jersey trustees who think they can move to Singapore yet keep all the administration in Jersey and think they move the place of effective management out of Jersey to escape the savings tax directive amendments, I have some bad news: The guidelines that will be issued is as follows:-
The place of management of a trust is the country in where the individual who generally controls and supervises the work of administering the trust, keeps the accounts, conducts the correspondence, arranges the meetings of the trustees and puts into effect the decisions taken at such meetings.
I’m afraid the rubber stamper in Singapore won’t cut it.
Mark Morris
That definition clearly won’t be effective. It fails to properly take account of the difference between “management” and “administration”.
I would add that if the place where accounts are kept was to become a factor of “tax residency”, where the accountant is merely recording what has happened as opposed to making decisions, ie management, then international tax law and standard OECD tax treaties will all become chaos.
How would you deal with tiebreaker provisions when one or more of those functions listed by you are carried out from several different jurisdictions, the majority of which are outside the scope of the EUSD?
How do you take account of the fact that in the vast majority of trust structures nearly all assets are held and activity carried out at underlying company level rather than at trust level?
I would agree with you that the “rubber stamper in Singapore won’t cut it”. That has always been the case and will remain the case. But that’s not the same at all as the Singapore trustee not being a “rubber stamper” and in fact genuinely managing the trust from Singapore. There is a massive difference between management and administration although you seem to be struggling with that concept. One thing is or sure. International tax law recognises that core difference.
I would be extremely relaxed if that definition of yours was adopted.
James, perhaps more irritating than personal insults is seeing someone take the time to comment on a thread like this accusing someone of putting forward a “flimsy argument” without actually saying what is flimsy or factually inaccurate about it.
In fact, I’d say making a point of whether Jersey Trust Law is here to stay or not is actually a pretty flimsy argument.
Sam, do I know you?
With regard to the other comments, Jersey’s Trust Law is as it is and just because Richard Murphy thinks it translates into allowing Sham Trusts is actually irrelevant because technically there is nothing he can actually do about Jersey’s Laws. Richard also mentions that we have no public listing of Trusts, which is strange as this confidential arrangement is no different anywhere else.
Under FATCA you will need one…
Wake up time, I think
“Under FATCA you will need one…”
Link please?
How else are you going to know which ones to report, and which not?
And since you now need to report to 6 or more states, how else could this be done but through a register, de facto or otherwise?
The trustee will know exactly which of its trusts to report as it holds full CDD on the trust parties. It absolutely does not need a central register to tell the trustees what they already know.
Please pull the other one…..
Pardon me?
Do you think there’s a single fiduciary in Jersey who would risk a prison sentence by ignoring their AML obligations? You have clearly not experienced a JFSC visit at first hand in recent times.
Well no one – not one person – has reported a Jersey bank account for suspected money laundering when tax is withheld when the only reason for that choice is tax evasion
I rest my case
Richard
I’m sure you do actually know the difference between a trust company and a bank. Why and in what circumstances would a trust company ever “report a bank account”?
I was making a systemic comment on failure to report suspected evasion to which jersey collectively and knowingly turns a blind eye – which it does
But we were debating the need for a trusts register in order for Jersey trustees to comply with FATCA, which is something completely different, as a trustee is in a totally different situation from a Jersey bank which has customers directly holding interest-bearing bank accounts. Sorry, but that’s chalk and cheese.
The big banks in Jersey can be blamed for an awful lot of things, but not in relation to the debate about “sham trusts”