Guernsey: Guernsey Legal Opinions

In finance transactions, legal opinions are often sought from local counsel as to the capacity of entities formed under the laws of Guernsey to enter into transactions and documents and as to the laws of Guernsey generally. This briefing summarises issues that might arise for instructing counsel or clients when requesting a Guernsey legal opinion. It is not intended to be exhaustive and specific advice should be sought in specific cases.

Information required by Guernsey counsel

When instructed, Guernsey counsel will typically request at the outset:

  • details of the Guernsey entity's local administrator, if any;
  • a structure chart;
  • a certified true copy of the entity's constitutional documents;
  • a certified true copy of the entity's certificate of incorporation and any certificate of change of name;
  • if relevant, a copy of any Guernsey regulatory consents relating to the entity/the transaction in question;
  • draft board minutes relating to the transaction, including approval of the transaction documents which are the subject of the opinion;
  • if relevant, a copy of any draft shareholder resolutions; and
  • the latest drafts of the documents in relation to which the opinion is to be given.

Issues commonly raised by Guernsey counsel when reviewing transaction documents

As part of the instruction, Guernsey counsel ordinarily would review any transaction documents being entered into by the Guernsey entity in question and may raise the following issues in relation to non-Guernsey law transaction documents:

  • inclusion of Guernsey in any definition of "Business Day": Guernsey has its own public holidays;
  • inclusion of Guernsey-specific insolvency (and similar) references;
  • whether there is clear corporate benefit to any Guernsey company entering into the transaction: if in doubt, Guernsey counsel is likely to suggest obtaining a shareholder resolution in relation to the transaction;
  • if opining on non-Guernsey law security, Guernsey counsel acting for a lender will notify the lender that it is unlikely that such security will create valid security over any Guernsey situs assets;
  • if any transaction document contains a guarantee, Guernsey counsel acting for a lender would suggest wording to waive customary law rights known as the "droit de division" and the "droit de discussion". The droit de discussion is a procedural remedy that may be available in Guernsey even if the guarantee is not governed by Guernsey law and would require a lender to exhaust its remedies against the primary debtor first, before pursuing the guarantor. The droit de division is a substantive remedy only available when the guarantee is governed by Guernsey law and provides that where there is more than one guarantor, a lender could only recover from each guarantor a proportionate part of the debt owed. It is standard practice to agree the waiver of the droits; and
  • whether the transaction being entered into by a Guernsey company constitutes a distribution for the purposes of Guernsey company law – if so, the Guernsey company would need to satisfy a statutory solvency test. For example, financial assistance constitutes a distribution and Guernsey counsel often consider an upstream guarantee to be a distribution to the extent that it results in an accounting loss being recognised in the accounts of the guarantor company.

Company searches

Searches of public records in Guernsey are limited in respect of the information they produce and not all documents filed physically before 1 July 2008 may be shown on the Guernsey Registry website. In addition:

  • there is no requirement to file information regarding shareholders or the secretary of a company, or regarding mortgages, security interests or charges over the shares or assets of Guernsey companies (other than real property in Guernsey and ships registered in Guernsey). A search also does not determine conclusively whether or not an order or application has been made or a resolution passed for the winding up of a company or for the appointment of a liquidator, administrator or other person to control the assets of a company, as notice of such matters might not be filed immediately and, once filed, might not appear immediately on a company's public file;
  • a company search in Guernsey is unlikely to reveal any information as to any insolvency, administration or receivership procedure initiated in any other jurisdiction; and
  • there is no official register of pending actions in Guernsey available for inspection by the public and no official litigation search procedure. Information given in Guernsey legal opinions in relation to legal proceedings for winding up, administration and pending actions generally is based upon a search of computerised records of matters already raised in the Guernsey court and enquiries made at the office of HM Greffier in Guernsey (the Greffe) as to the existence of claims or actions before the courts of Guernsey to which a company is a party. The records at the Greffe are maintained for its own use and not pursuant to any public obligation and therefore the accuracy of such records is not guaranteed. The records depend on input by Greffe officials and any time delay could give rise to an inaccurate search report.

Guernsey counsel will update searches on the day on which the opinion is issued. The Greffe is open on weekdays only, from 9am until 4pm. Opinions issued outside these hours may be subject to qualifications if searches cannot be concluded.

Director's certificates

As only limited information is ascertainable from public records, Guernsey counsel will also rely on a certificate from a director of the company as to factual matters. A director's certificate will need to be signed by a director and dated the date of the opinion (or reconfirmed as at that date) and will deal with matters such as the following:

  • confirmation that the copy constitutional documents provided are true, complete and up-to-date;
  • confirmation that board meetings held to approve transaction documents were validly convened and quorate;
  • confirmation as to the authorised signatories of the company;
  • confirmation that the company is existing and has complied with all registration, regulatory and other requirements and that all consents and approvals received from the Guernsey Financial Services Commission remain extant;
  • confirmation that no application has been presented or order made or resolution passed or analogous proceedings taken for appointing an administrator or liquidator of or for winding up the company;
  • confirmation that the company is solvent and is able to pay its debts as they fall due and will not become insolvent or unable to pay its debts as they fall due as a result of the entry into the transaction documents and that no action has been taken or threatened to wind up the company or to have its assets declared "en désastre" and no receiver has been appointed; and
  • confirmation that the company is not involved in any litigation or other proceedings, nor is any litigation pending or threatened against the company.

The director's certificate is a document of Guernsey counsel and is not usually the subject of negotiation, save with the director providing it or his advisers. The giving of the director's certificate should be authorised at the relevant board meeting.

Assumptions and qualifications

Partly because only limited information is ascertainable/verifiable by Guernsey counsel and partly because opinions given may require further explanation, the opinions given will be subject to a number of assumptions and qualifications, for example:

  • assumptions will be made as to matters such as authenticity of signatories, compliance with applicable laws, that the parties are dealing with each other in good faith, commercial benefit of the transaction and good title to assets being secured; and
  • qualifications will deal with matters such as legal limitations on enforceability of documents, limited nature of information available from company searches and the requirements for perfecting Guernsey law security after the relevant documents have been entered into.

There will also be transaction-specific qualifications and assumptions.
If there is a requirement for transaction management, witnesses or attendance at meetings, this may affect the estimated costs of providing an opinion.

Issue of the opinion

The basis on which the opinion is issued is a matter for agreement between Guernsey counsel and instructing lawyers/client. For example, the Guernsey legal opinion may be:

  • issued on the basis of executed and dated transaction documents;
  • issued on the basis of signed but undated documents;
  • issued on the basis of draft, unsigned documents; or
  • issued contingent on the happening of certain events. For example, where timing of completion is tight, Guernsey counsel may agree to sign the opinion on the basis of having reviewed signed, undated documents, such opinion to be held to the order of Guernsey counsel and then deemed to be automatically released/issued by the dating of the documents the relevant date.

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.

Mark Helyar
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