Since the beginning of the global financial crisis, politicians, the media and people on the street have engaged in a series of "blame games" to point fingers and punish those responsible for their own economic ills. For the past few years, one "culprit" has been firmly in the spotlight - the offshore industry. Say the word "offshore" and you conjure up images of Caribbean, palm-fringed islands where people go to avoid paying tax. Is the stereotype of sunny places for shady people fair or is there a legitimate reason why this industry exists?

Fuelled by public sentiment and the moral debate raging about how much tax an organisation or individual should pay, international bodies like the OECD, the G8 and G20 have been racing to enact a dizzying range of new initiatives such as the automatic exchange of information, base erosion and profit shifting (BEPS) and common reporting standards (CRS). Throw in the US Foreign Account Tax Compliance Act (FATCA) as well and the offshore industry is left wading through an alphabet soup of acronyms and oversight, and one might think the future looks bleak.

But these new regulations highlight one of the great misconceptions surrounding the offshore industry; namely that its services are primarily used for tax-avoidance. On the contrary, research shows that whilst historically tax planning has been a big reason for offshore structures, asset protection and fund management are now emerging as the main drivers.

Few outside the offshore industry really understand it, but if you believe globalisation is a driving force behind economic growth, job creation and delivering opportunities for the societies that we live in, then it is worth understanding how this system is enabled. Offshore structures and services do this by performing crucial functions, including reducing cross border "friction-costs" and facilitating the flow of capital. To put it simply, it serves as the "plumbing" or "wiring" of our modern, integrated and globalised economies.

By way of an example, offshore jurisdictions have long served as neutral venues for companies making cross-border investments, motivated by the comfort drawn from robust and familiar legal systems and professional infrastructure. Investors also benefit from treaties preventing double taxation and for outbound investments, greater flexibility where capital account restrictions apply in their home country. Chinese outbound investment is set to surpass foreign direct investment and without a fully convertible renminbi, offshore centres like Hong Kong and the British Virgin Islands provide the ideal "conduit" for Chinese companies and high net worth individuals investing offshore.

To our mind the objectives of this wave of new regulation should be to stamp out wrongdoings whilst protecting and respecting the legitimate role the industry plays. There's no denying that offshore structures have been abused by some and allowed dishonest behaviour to go unnoticed, and this should be stopped. National governments have every right to collect tax from companies and individuals. But in the same breath, companies who operate across borders and accept the risks that come with this shouldn't be disincentivised by inefficient trading and investment infrastructure.

The question of privacy remains a quandary. In Europe the debate rages on about the use of public registers to show ultimately who owns what. There is, in our view, a subtle but key distinction which is being lost here – the difference between secrecy and confidentiality. It goes to the question of intent. On one hand, an individual or group might be trying to hide something because the rules have been broken. On the other, everyone has a right to keep their financial affairs out of the public domain. There are many reasons why an individual or corporation requires information to be confidential that are in no way nefarious

We therefore ask regulators to embrace reality not rhetoric as further rules and regulations are being contemplated. We support regulations that balance the need for greater transparency with a need to support companies in their quest to go global

By enforcing greater transparency you increase accountability which naturally encourages better behaviour and creates deeper trust with your stakeholders. So those with nothing to hide should not be afraid and instead embrace what this new world looks like and the opportunities it brings. This applies to offshore centres as well, and the smart ones are at the forefront, implementing new regulations to improve transparency in an appropriate and measured way and keep their jurisdiction in favour with governments and regulators around the world

Despite the current pressures, demand for offshore structures continues to rise as corporations and individuals look to do business across borders, leveraging the robust legal systems and administrative skills available in offshore centres. Research shows that for 2014 the number of new structures incorporated in five of the top offshore jurisdictions including British Virgin Islands (BVI), Cayman Islands, Seychelles, Samoa and Jersey was up by more than 23% since 2009

Against a backdrop of political pressure for more regulation and the increasing demand for offshore structures, industry participants have a responsibility to protect the reputation of the industry by enforcing impeccable standards of practice and educating stakeholders of the valuable role the industry plays in the global financial supply chain. We are already seeing a more co-ordinated and assertive approach towards working with regulators, and in developing legislation through the work of International Financial Centres Forum and the likes. We should continue to play an active role in this process

It is perhaps ironic that the very regulations designed to stem the industry could and should in fact legitimise it, make it stronger, and ultimately bring it into the mainstream. With more objective dialogue and better education – as well as an effectively regulated and transparent system – jurisdictions and service providers alike may finally be able to shed some of its negative perception and be confident with the important role it plays in enabling global economic development.

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