Guernsey: A Different Offshore Centre For The Asian Market

Last Updated: 31 December 2012
Article by Fiona Le Poidevin

Most Read Contributor in Guernsey, November 2017

Originally published in Asian Investor, December 2012

Fiona Le Poidevin, Chief Executive of Guernsey Finance, explains what Guernsey has to offer to Asian clients.

There is a growing awareness in Asia of the products and services that offshore centres can provide to Asian individuals and companies.

An offshore jurisdiction provides a third country location from which Asian families can protect and even enhance their wealth for the benefit of future generations, and Asian companies can establish entities for investing both out of or back into their home region.

However, what we are finding is that many in Asia still equate offshore with only those jurisdictions in the Caribbean, and in particular, the British Virgin Islands (BVI) and the Cayman Islands.

Asian clients and their advisers need to understand that offshore extends beyond those jurisdictions; indeed, not only are there other international finance centres but these offer a very different and in many cases better proposition. For example, the European-based British Crown Dependency of Guernsey is able to provide Asian clients with a full service proposition in a tax-neutral environment, with close proximity and strong links to the City of London.Guernsey is recognised by international organisations as meeting robust standards in terms of corporate governance, regulation and tax transparency. These attributes have gained added significance in the wake of the global financial crisis and provide extra comfort to both clients and their advisers.

In addition, it is our understanding that while the initial, upfront costs of doing business in Caribbean jurisdictions may be less than using Guernsey, in fact, over the longer term, the expense is likely to be broadly comparable.

The Guernsey offering

During the last 50 years, Guernsey has established itself as a leading international finance centre.

Today, the four main pillars of the Island's finance industry are:

* Banking – There are 33 licensed banks holding more than £103 billion ($164 billion) worth of deposits;

* Fiduciary services – There are 154 licensed fiduciaries, ranging from multinational organisations to independent, boutique operations, employing more than 2,000 members of staff;

* Investment funds – There are 50 fund managers, administrators and custodians with total net asset value of funds under management and administration of £271 billion ($430 billion); and

* Insurance – The Island is the largest captive insurance domicile in Europe and number four globally.

These sectors are supported by a network of professional services, including multi-jurisdictional law firms and global accountancy practices. Guernsey firms provide a wide range of products and services at the highest standards to clients from around the globe, including Asia.

Guernsey Finance, the promotional agency for the Island's finance industry, has long recognised that there is significant opportunity to increase business from Asia given the growth of private and corporate wealth in the region. As such, we established an office in Shanghai in 2007 and this has been followed by a number of Guernsey-based firms developing their own presence in the region. For example, law firm Ogier has offices in Hong Kong and Shanghai, Mourant Ozannes is now established in Hong Kong, and Collas Crill has set up in Singapore. Fiduciaries Louvre, Nerine and Newhaven have established offices in Hong Kong, and Richmond Fiduciary Group is in the process of opening an office in Shanghai. In addition, fund administrator International Administration Group (IAG) has established an office in Hong Kong, has opened another in Singapore and has established a partnership with Exceedor in Shanghai, which allows it to provide onshore renminbi-denominated private equity fund administration services in China. Guernsey's expertise within the funds industry is being utilised by the Chinese government and the country's fund managers to enhance the way its own funds sector is operated and regulated. Julian Carey, managing director of IAG's Asian operations, says discussions are concentrated on enhancing the reporting and corporate governance standards in China.

IAG's presence in the region is particularly pleasing because it means that there is a Guernsey firm in the region promoting the benefits of the Island as a centre from which Asian companies can establish entities for investing both out of or back into their home region.

Investment funds centre

Guernsey has a strong heritage in providing a domicile for corporate entities acting as investment vehicles and especially funds. This experience means that the Island has built a wealth of expertise and firstclass infrastructure for servicing not just traditional funds but also alternative asset classes.

Managers with a presence in Guernsey include major names such as Apax, Permira and Terra Firma. Other promoters of Guernsey funds include Better Capital, Coller Capital and KKR. Administrators based in Guernsey range from specialist boutiques to global players such as HSBC, JP Morgan, Northern Trust, RBC and State Street, which can also act as custodians. The majority of their business relates to servicing Guernsey open and closed-ended funds, which are now promoted by leading institutions from more than 55 financial centres globally.

However, Guernsey-based firms are also able to service schemes established in other jurisdictions, such as the Cayman Islands. What is more, it is not unheard of for promoters to be so satisfied with their experience of the Island through the 'non-Guernsey' route that they decide to redomicile their funds to Guernsey. Certainly, this provides more weight and substance from a tax perspective as the majority of services are provided from the jurisdiction in which the fund is domiciled.

Accessing capital markets

Guernsey has built a strong reputation as a domicile for private-equity funds and also infrastructure funds, in particular where there is demand to list on a stock exchange. For Asian clients, Guernsey provides an ideal gateway to accessing European capital markets. Guernsey entities can be listed on a range of stock exchanges, including the London Stock Exchange (LSE) and the local Channel Islands Stock Exchange (CISX), among many others. There are more non-UK entities from Guernsey listed on the markets of the LSE than any other jurisdiction globally. Examples include the Main Market-listed Macau Property Opportunities Fund Limited, which invests in a range of property within Asia, and the AIM-traded China Growth Opportunities Limited, which invests in companies within China.

In addition, Guernsey entities can also be listed on the Hong Kong Stock Exchange (HKEx) and we have been holding discussions with the authorities in both Shenzhen and Singapore with a view to reaching a similar conclusion in respect of their exchanges.

Why Guernsey?

Guernsey's vast experience as an international finance centre means we are tried and tested but we are also dynamic and forward-thinking, as demonstrated by the launch of our own regional stock exchange, the CISX, and our innovation of the cell company concept. In addition, the Guernsey Financial Services Commission (GFSC) has built a reputation for robust yet pragmatic regulation. For example, 'fast track' routes have been introduced which allow for the speedy launch of funds targeted at professional investors, and yet those investors also have the security of knowing that all Guernsey funds are regulated.

The Island is also providing certainty by announcing that it plans to provide a dual regime under the EU's Alternative Investment Fund Managers Directive (AIFMD). It is Guernsey's intention to operate a full AIFMD equivalent regime for those marketing funds within the EU or who choose this as their preferred option, while retaining a parallel regime with its own appropriate set of regulations for those with structures not touching the EU. The GFSC also ensures that funds follow the appropriate local or international codes of corporate governance and the fact that the Island has a pool of experienced and qualified non-executive directors reassures investors and promoters. This means that agencies such as the International Monetary Fund are able to declare that the Island is working to robust international standards. The Guernsey government also continues to ensure we adopt international standards of tax transparency so that, for example, the Island was within the first wave of jurisdictions placed on the OECD/G20 'white list' in April 2009.

Further, we are well advanced to signing double-tax arrangements (DTAs) with both Singapore and Hong Kong. Even in advance of those coming into effect we have a corporate tax regime where all financial products are either taxed at 0% or are tax exempt.

A different offshore centre

The Asian market has traditionally used offshore centres in the Caribbean but this article highlights to clients and their advisers that Guernsey provides a different proposition which is more in tune with the future direction of the global financial services industry.

Guernsey: In Brief

Situated in Europe between the UK and France

A British Crown Dependency

Not part of, but a special relationship with, the European Union (EU)

English speaking

Currency: British pound Sterling (GBP)

Same time zone as the UK

Links to both London and Europe

Guernsey as a finance centre: Quick facts

OECD/G20 'white list'

Signed 38 TIEAs, including China

A growing network of DTAs

IMF commended regulation

The Banker rankings: No. 2 Specialist Finance Centre*

Global Financial Centres Index: No. 2 Offshore Finance Centre (28th overall)*

*Both published September, 2012

For more information about Guernsey's finance industry please visit

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions