Category: Beneficial Ownership

The Changing Face of Luxembourg Finance

“Luxembourg is famous for two things: its steel industry and its rose cultivation industry”. This quote from an Italian guidebook of the 1930s was uttered by Luxembourg’s Finance Minister Pierre Gramegna at the annual conference of the Luxembourg Directors’ Association on 17 June 2015[1]. The economic outlook of the tiny… – Continue reading

Bank La Roche & Co AG Reaches Resolution Under US Justice Department’s Swiss Bank

The Department of Justice announced today that Bank La Roche & Co AG has reached a resolution under the department’s Swiss Bank Program. “Today’s agreement is yet another example of a foreign financial institution coming forward, acknowledging its criminal conduct, taking the necessary steps to resolve its criminal exposure, cooperating… – Continue reading

Agreement between Mainland China and Taiwan to avoid double taxation on income

On August 25, 2015, the People’s Republic of China and Taiwan signed an Agreement for the Avoidance of Double Taxation regarding Taxes on Income (“the DTA”), which will enter into force when the legal procedures have been completed. The DTA’s highlights: 1. Permanent establishment (“PE”) specifications The DTA establishes a… – Continue reading

Cyprus: The New Protocol To The Cyprus–South Africa Double Taxation Agreement

On April 1, 2015, Cyprus and South Africa signed a Protocol amending their existing double taxation agreement (“DTA”), which was signed in 1997 and has been in force since December 8, 1998. At the time the original DTA was concluded, dividends arising in South Africa were not subjected to South… – Continue reading

Indonesia and the Netherlands sign Protocol to amend existing Tax Treaty

On July 30, 2015, the Netherlands and Indonesia signed a protocol (the “Protocol”) amending an agreement between the Government of the Kingdom of the Netherlands and the Government of the Republic of Indonesia for the avoidance of double taxation and the prevention of fiscal evasion, originally signed on January 29,… – Continue reading

Ex parte preservation orders: Krok v CSARS

This case was an appeal from the Gauteng Division of the High Court to the Supreme Court of Appeal (“SCA”) pertaining to the correctness of the granting of an ex parte preservation order application that was brought against Mr Krok by the Commissioner of the South African Revenue Service (“SARS”) in… – Continue reading

Tories ease pressure on Cayman Islands over tax transparency

Britain’s Conservative government has relaxed demands on the Cayman Islands to create a register detailing company ownership, despite Prime Minister David Cameron’s previous call for Overseas Territories to adopt the measure to promote transparency. The UK’s Overseas Territories and Crown Dependencies make up almost 25 percent of the world’s tax… – Continue reading

UK seems to relax pressure on Caymans over company register

Grant Shapps, Foreign Office minister, says on visit that Cayman Islands could use existing systems to help tax authorities The UK government appears to have relaxed its pressure on the Cayman Islands to create a register of company ownership, despite David Cameron’s plea last year for overseas territories to do… – Continue reading

Promoting FDI through a tax treaty

In addition to its main function to eliminate double taxation, a tax treaty is also intended to promote foreign direct investment (FDI). Investors normally consider the treaty networks of a targeted investment country in deciding their investments. The more extensive the treaty networks, the more attractive for the investors. Extensive… – Continue reading

Indian Court Allows Mauritius Treaty Benefits For Appellant

Rejecting “treaty shopping” claims, India’s High Court of Punjab and Haryana has ruled that India should not tax capital gains from the sale by Mauritian entities of shares held in an Indian company if they are proven resident in Mauritius. The ruling was given in Serco BPO Private Limited v…. – Continue reading

Russian “Economic Patriotism” May Shake Things Up For Wealth Managers

New de-offshorization and capital amnesty laws could have widespread effects In an attempt to encourage “economic patriotism,” Russia recently adopted two new laws: (1) The De-Offshorization Law, which makes a number of major changes in the existing systems of corporate and personal taxation in Russia, particularly as they pertain to… – Continue reading

Beneficial ownership disclosure: when private becomes public

The most controversial part of the Fourth Anti-Money Laundering Directive (4th AMLD) is probably going to be the Register of Beneficial Ownership. The controversy arises since certain information which is considered private and which legitimately could be kept as such, will now be made available to a number of persons… – Continue reading

Preparing for new corporate offence of agents facilitating tax evasion

FOCUS: The UK government plans a new criminal offence for companies and partnerships whose ‘agents’ facilitate the evasion of UK tax. The proposal is to make corporations criminally responsible if they fail to take reasonable steps to prevent their agents from taking actions that facilitate tax evasion. Agents include employees… – Continue reading

India: Foreign banks startled by new black money law

Banks overseas, spooked by India’s stringent new black money law, are asking tough questions of people and entities from the country looking to open accounts with them, reports the Economic Times. That’s because it’s not just those who possess unaccounted wealth who will get punished, those found guilty of helping… – Continue reading

European Union: The Future Of Trusts In The Context Of The 4th AML Directive

The following article by Dr Monica Galea John, partner in the Financial Services Department, analyses the manner in which the Fourth EU Anti Money Laundering Directive (the “Directive“) which has just made its way through the EU’s legislation, obliges, for the first time, EU member states to maintain central registers… – Continue reading

Advisers get ready – new AML requirements may be on the way

The U.S. Treasury Department’s Financial Crimes Enforcement Network will soon propose new rules that may require investment advisers to establish and implement written anti-money laundering programs designed to prevent advisory clients from using advisers to launder funds or perpetrate other criminal activities. The rules also may require advisers to report… – Continue reading

Cyprus: The New Double Taxation Agreement Between Cyprus And Georgia

On May 13, 2015, Cyprus and Georgia signed a new double taxation agreement (DTA). Unlike many former members of the USSR, Georgia did not adopt the 1982 Cyprus–USSR DTA when it became independent, and the new agreement is the first between the two countries. It will come into force once… – Continue reading

Justice Department Announces That Three More Swiss Banks Reach Agreements Over Tax Evasion Claims

On July 30, 2015, the Justice Department’s Tax Division announced that three more Swiss banks — PKB Privatbank AG, Falcon Private Bank AG and Credito Privato Commerciale in liquidazione SA (CPC) – have cut deals with the U.S. to resolve allegations that those institutions assisted their U.S. customers in hiding… – Continue reading

UK property ownership transparency will speed up the fight against fraud, says expert

Requiring the Land Registry to publish information about foreign companies that own property in England and Wales could ultimately speed up the recovery of money from fraudsters who have “hidden” victims’ money in a variety of corporate structures, an expert has said. UK prime minister David Cameron announced new measures… – Continue reading

The Netherlands: Recent Financial, Regulatory and Legislative Developments

With the focus of 2014 being international tax competition, 2015 shows signs of continuing this trend. The European Commission (COM) and European Parliament (EP) are starting to debate and extensively investigate Member States’ tax ruling policies, partly as a result of the LuxLeaks revelations and partly in relation to the… – Continue reading

More transparency over UK prime property ownership needed to prevent fraud, campaigners say

Plans to create a public registry of the real owners of UK companies should be extended to make it clear who is behind the companies that own high-value London properties, Global Witness has said. Plans to create a public registry of the real owners of UK companies should be extended… – Continue reading

New call for prime London agents to be more transparent

A pressure group is calling for estate agents to conduct additional checks to ensure the legal provenance of buyers’ funds, and wants all on- and off-shore companies owning UK property to be obliged to tell the Land Registry the identify of their beneficial owners. Global Witness – a group campaigning… – Continue reading

A proposal to extend beneficial ownership rules to UK land-holding foreign companies

A report published today by Global Witness, alleging that an individual with ties to a former Kazakh public official owns large swathes of London, follows much recent interest in the issue of public officials owning property in the UK via secretive corporate structures that conceal their interest. Earlier this month,… – Continue reading

Call for greater transparency in London property

In a published report, anti-corruption organisation highlights complex structures through which swaths of UK property are owned Global Witness has called for greater transparency around the ownership of UK properties after reviewing alleged links between a former Kazakh secret police chief accused of money laundering and a London property portfolio… – Continue reading

European Union: EU Approves 4th Anti-Money Laundering Directive

After almost a year of wrangling, the EU Council and the European Parliament have finally reached an agreement on a new Anti-Money Laundering Directive. The 4th AML Directive expands the scope of its predecessor (which was adopted in 2005, before the global banking scandals and the push towards tax transparency)… – Continue reading

GAAR provision to make way into India-Mauritius treaty

India and Mauritius are set to limit the benefits of their double tax avoidance agreement (DTAA) to only genuine businesses bringing foreign direct investment to India by inserting a new clause in the treaty straight from New Delhi’s yet to be implemented General Anti-Avoidance Rules (GAAR). The revised treaty, however,… – Continue reading

New corporate criminal offence of failure to prevent facilitation of tax evasion to include evasion of non-UK tax

A new UK criminal offence for corporations who fail to take reasonable steps to prevent their agents from criminally facilitating tax evasion would apply even if it is non-UK tax that is being evaded. The proposed details of the new offence are set out in a consultation document published by… – Continue reading

Worldwide: Privacy: What’s Left?

A seismic change in the international private wealth arena is under way. Over 90 jurisdictions have committed to automatically exchange comprehensive financial information on an annual basis under the OECD’s Common Reporting Standard (CRS). The CRS will start in 2016 in over 55 jurisdictions. This article comments on the CRS… – Continue reading

How non UK residents should buy or own residential property

How should non resident or non domiciled buyers of UK residential property own or hold residential property? Overseas buyers or owners of UK residential property above £1m in value need to consider carefully in what name or legal structure they should buy or hold property for their protection and to… – Continue reading

Switzerland Tops The Financial Secrecy Index

When the HSBC Holdings plc (ADR) (NYSE:HSBC) (LON:HSBA) Swiss leaks story broke the big shock was that someone had produced evidence, not that one of Switzerland’s notoriously secretive banks had helped people evade taxes. We know that trillions are stashed away in tax havens around the world (the ICIJ estimates… – Continue reading

A Perspective on BEPS From Russia

OECD and G20 Action Plan on Base Erosion and Profit Shifting (BEPS) was adopted in 2013. It consists of 15 actions including transfer pricing, taxation of controlled foreign corporations (CFC), digital commerce, hybrid instruments, international information exchange, tax treaty shopping etc. In 2013, OECD working group prepared draft documents regarding… – Continue reading

Annuar, we have copy of internal briefing, says Rafizi

Mara could have set up an Australian subsidiary but instead chose to construct an elaborate network in several countries. KUALA LUMPUR: National Oversight & Whistleblowers (NOW), an NGO headed by Pandan MP Rafizi Ramli, has alleged that the nature of Mara property purchases overseas was camouflaged through various offshore companies… – Continue reading

Manhattan DA: Cayman ‘better positioned’ to fight terrorism finance

The Cayman Islands is better positioned to police terrorism financing than the U.S., an American congressional subcommittee heard Wednesday. The comments came from New York County District Attorney Cyrus Vance, who was called before the U.S. House Task Force to Investigate Terrorism Finance. “On a near daily basis, we encounter… – Continue reading

MACC has enough bite to probe Mara’s Melbourne property scam, says anti-graft watchdog

Anti-graft organisation Transparency International-Malaysia (TI-M) has urged the Malaysian Anti-Corruption Commission (MACC) to conduct a thorough investigation into Majlis Amanah Rakyat’s (Mara) purchase of a Melbourne property that was alleged to have been bought in a scam. TI-M president Datuk Akhbar Satar said there were enough provisions in the MACC… – Continue reading

Mauritius to act against black money: Finance Minister Seetanah Lutchmeenaraidoo

NEW DELHI: Mauritius has offered to put in place stringent conditions for investors seeking benefits under its tax treaty with India to weed out post-box operations, addressing a key concern of New Delhi that has been attempting to amend the agreement for years. “We don’t want investors to open shell… – Continue reading

Tax transparency – the road ahead

In the last few years, particularly following the credit crunch, there has been a tangible focus on tax avoidance and clamping down on tax planning. Overnight, the rules of the game were changed and what was previously considered to be legitimate tax planning was condemned as being aggressive and morally… – Continue reading

FATCA documentation for disregarded entities

Introduction The Foreign Account Tax Compliance Act (FATCA) requires entity account holders to document their status for US withholding tax purposes (Chapter 3 status) and their status for FATCA due diligence purposes (Chapter 4 status). In the case of a non-US entity account holder that has made an entity classification… – Continue reading

Disgraced Fifa Boss Stashed $1m At Cibc Bahamas

A disgraced senior FIFA official has agreed to forfeit 50 per cent of the $1 million he had stashed away in a secret CIBC FirstCaribbean International Bank (Bahamas) account, court documents have revealed. The plea agreement between the US federal authorities and Charles (Chuck) Blazer, which was unsealed late on… – Continue reading

The Fifa scandal and money laundering laws

Blatt’s all folks!’ was probably the pick of the tabloid headlines following the announcement that Sepp Blatter intends (finally) to step down as president of Fifa. Over the course of the next few months, he won’t be the only person anxiously awaiting the outcome of the current investigations into alleged… – Continue reading

New EU Rules on Disclosure of Ultimate Beneficial Owners

On June 5, new EU’s anti-money laundering (AML) rules, namely the Fourth EU Anti-Money Laundering Directive (“4AMLD”) and a new Regulation on the information accompanying transfer of funds were published in the Official Journal of the European Union. Together, this legislation represents the revised EU framework on anti-money laundering and… – Continue reading

Russian Federation: Russian De-Offshorisation Legislation And Voluntary Disclosure: Which Way Now?

The new law on the taxation of controlled foreign companies (the ‘CFC’ law) and other anti-offshore measures effective as of 1 January 2015 have raised a number of questions for clients and advisers. A number of changes to the new laws were long anticipated and have now been passed by… – Continue reading

New EU anti-money laundering rules to take effect from 26 June

A raft of reforms to EU anti-money laundering rules will come into force later this month after they were finalised and published in the official journal of the EU, reports Out Law. The fourth Anti-Money Laundering (AML) Directive will take effect from the 26 June. EU countries will have two… – Continue reading

Bahamas: Financial services keeping up with international best practices claims Strachan

Minister of Financial Services the Hon. Hope Strachan said international best practices are evolving at a rapid pace, particularly as it relates to automatic tax exchange initiatives, tax transparency, anti-money laundering and financial crime, and e-commerce, reports the Bahamas Weekly. Making her contribution to the 2015 Budget Debate in the… – Continue reading