Jersey: Feature: A Steady Ship

Operating in the current European cross-border fundraising and investment market can be a regulatory minefield for private real estate managers and investors, thanks to Brexit, AIFMD, and a host of other EU Directives affecting the alternatives sector. Managers are looking to park their funds in a reliable domicile to mitigate any potential disruption, and Jersey is proving to be the location of choice for a growing number. Jersey Finance launched in 2001 to promote the jurisdiction as a center of excellence for business. The effort is paying off. A conversation between Mike Jones, Crestbridge, and Mike Byrne, PWC Channel Islands, reveals why this small island in the English Channel provides a compelling story for the sector.  

Brexit proof

Mike Jones: There is currently a lot of uncertainty because of Brexit, not only in the UK and Europe, but in the rest of the world. It is easy to forget the impact on a Singapore, Canadian or Swiss asset manager looking to market funds across Europe. But for Jersey it is also creating opportunities. Post-Brexit, the UK will not be as constrained by EU requirements and will be motivated to develop free trade agreements throughout the world. Jersey, being a crown dependency of the UK, is well placed to benefit from the new business this will bring. It is in prime position to offer managers access to the UK market. At the same time, Jersey is likely to maintain good access to Europe too.

Michael Byrne: I agree Brexit has caused uncertainty for the UK real estate market. But in Jersey itself, some of the largest private funds raised have come in the period since the referendum because Jersey is seen as a stable jurisdiction. Brexit has caused a lot of noise, but as an autonomous, self-determining country, Jersey is somewhat Brexit proof. The island is not a pawn in that particular political game. Those large funds have huge teams doing due diligence, and assessing multiple jurisdictions before they decide where they are going to locate. Their choice of Jersey indicates it is viewed as a safe option for managers going forward.  International assessments by organizations such as the International Monetary Fund (IMF) and the Council of Europe back this up; they consistently rank Jersey at the top.

MJ: Market access will be a key issue for managers post-Brexit. The dynamics in Europe in terms of third-country equivalent assessments and third-country access will change. Europe will have to look closely at its third-country regime. Managers need to think carefully about where they will domicile and market themselves going forward. Jersey's access to National Private Placement Regimes (NPPR) can play an important role in offering UK and other non-EU managers continued access to Europe and European managers access to the UK market. From the investor perspective, the regulatory climate presents challenges too. US-based funds and investors, for example, struggle with the European regime. Quite frankly, sometimes they are not bothering with Europe. That is a shame in terms of investor choice and investors in Europe being able to access the best managers around the world. Europe is viewed as too difficult, too costly. The NPPR allows managers to market to two or three jurisdictions in a more effective and cost efficient manner, and to avoid a pan-European marketing effort.

Business continuity post AIFMD

MB: Initially, the directive was badly received by mangers and investors, but it would have been more difficult to work with had it not been for the UK's involvement under Lord Hill. This is not going to be the case with the forthcoming review of the Directive and shaping of AIFMD II. Several industry bodies, and also the EU Commission, have already surveyed the industry to gauge sentiments and concerns around AIFMD II. There is a perceived danger of the EU shutting off distribution of non-EU funds into Europe. It cannot afford to get this wrong. Investors want free choice and access to the best managers in the world. The EU must avoid creating barriers to access.

MJ: The impact of AIFMD on Jersey itself has not been too dramatic. Looking back over the last five years, NAV in Jersey is up about $100 billion. Through NPPR there are around 150 managers marketing about 300 funds into Europe. Those stats are going up every quarter. Jersey has done everything to ensure business continues smoothly for managers and investors post-AIFMD in terms of securing market access. Jersey has proven time and time again that it can negotiate effectively with relevant EU authorities; it did this well under AIFMD I. I expect Jersey to continue lobbying for the same security and market access for managers under AIFMD II. 

A secure anchor

MJ: Jersey's regulatory standards are a key reason why it is now one of the most favored fund domiciles. It offers proportionate responses to difficult issues. This is an important differentiator. Managers are getting flexibility but with very high standards. Couple this with speed to market. Managers can get their products authorized and launched incredibly quickly, knowing they are not going to sit with the regulator for six months. That is a huge benefit from my perspective.

MB: Those are all good reasons for locating in Jersey, but I would add product choice as to why it is seen as a safe bet for real estate fund managers. The jurisdiction offers a range of products and structures to suit every situation. Then there are soft factors. The jurisdiction has had a finance industry for 40 years. The professionals working there are true experts; highly qualified and trained. And Jersey is an easy place to do business. When we think about some other jurisdictions in Europe, it is hard to get straight answers or to achieve quick turnarounds; they sometimes lack a can-do approach. Jersey, by contrast, is very client-centric. The culture is just right.  

MJ: We should also not ignore the political and economic stability Jersey offers as a reason for managers domiciling there. If you look around the world, there is little of that these days. Despite its small landmass, Jersey is a jurisdiction of substance with over 13,000 employed in the finance industry; not the perception many people have of an offshore center.  

MB: PWC recently forecast that global AUM will increase 70 percent by 2025 and that alternative assets will grow from $10 trillion to $21 trillion over the same period. In terms of real estate, we are seeing more people moving to cities, and a pressing need to replace existing stock. There is more investor appetite for real estate. That is great news for Jersey, which is well placed to share in the opportunities this growth will bring. Jersey is innovating new products and services to make sure it remains relevant to that growth.

You can read the article on PERE.

Linkedin - www.linkedin.com/company/jersey-finance
Twitter - @jerseyfinance
Youtube - www.youtube.com/jerseyfinance

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 Mondaq.com.

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

Authors
Similar Articles
Relevancy Powered by MondaqAI
Jersey Finance Limited
Jersey Finance Limited
Jersey Finance Limited
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Jersey Finance Limited
Jersey Finance Limited
Jersey Finance Limited
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
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
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

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 or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq 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 of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

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