I hear rumour that the EU is looking seriously at revisions to the Savings Directive. These are the changes that they would like to to implement:-
1) The definition of a Paying Agent would change to include foreign branches of outside the EU who have headquarters within EUSD jurisdiction e.g. the Singapore branch of a UK bank.
2) The definition of a beneficial owner of an account might change to ensure the following are caught:
- Private companies if the ultimate owner(s) are in the EU as shown by a banks 'know your client' procedure;
- The settlor of Discretionary Trusts if they are revocable or have settlor reserved powers. Nominee Settlors will not be acceptable
- In the case of Foundations the provider of the source of funds, which need not be the founder, will be considered the beneficial owner.
- All types of partnership will be covered - the partners will be treated as the owners.
3) Interest will now include non-UCITS funds, unregulated funds, derivatives comprising or based on interest e.g. structured products, baskets, certificates and interest swaps.
4) In the case of insurance policies the insurance company will be considered the paying agent and will apply the EUSD as soon as it receives interest. The beneficial owner is the policyholder. International pensions will be treated as if they are insurance products except the pension providor is deemed to be the Paying Agent.
If these happened most of the loopholes in the ES Savings Directive would go.
Now that would be a good thing. It would blow Jersey's sham trusts apart for a start - and that would be especially welcome. One has to hope the countries line up in an orderly queue to sign this as soon as possible.