Over the last 12 months, we have advised a number of clients on sales and acquisitions of Jersey businesses and we have recently seen a number of high profile moves by hedge funds and other businesses to our Jersey shores. Working with these clients has highlighted a number of important issues to be considered on sales and acquisitions and for new businesses coming to the Island.

Jersey offers a wide range of corporate vehicles for businesses to consider, including companies, foundations and limited partnerships. The particular corporate vehicle chosen will very much depend on the client's objectives, business needs, the size and nature of the business, structuring requirements and tax and regulatory issues. To achieve the right structuire it is vital to ensure that a close relationship exists with the client and their advisers.


For a new business, particular regulatory consents are required to incorporate or register a new corporate vehicle. For example, consents under the Control of Borrowing (Jersey) Order 1958 will be required to incorporate companies or to register limited partnerships. Consents are issued by the Jersey Financial Services Commission (JFSC) who will require details of the ultimate beneficial owners of the entity together with the proposed business activities. The JFSC operates a Sound Business Practice Policy and as part of this certain activities classified as "sensitive" may be subject to particular scrutiny by the JFSC before consent is issued. The Housing and Work regulations (described in more detail below) will also be an important factor to consider before undertaking any business in Jersey.

Depending on the nature of the business, other licences and consents may also need to be obtained before business can commence in Jersey. For example, banking licences may be needed under the Banking Business (Jersey) Law 1991, licences may be required under the Financial Services (Jersey) Law 1998 to carry on investment business or to provide fiduciary services, and consents may be required under the Insurance Business (Jersey) Law 1996 or the Collective Investment Funds (Jersey) Law 1988.

It is also important to consider if consent may be needed from the Channel Islands Competition and Regulatory Authorities (CICRA). Anti-competitive behaviour, including anti-competitive agreements between businesses and the abuse of a dominant position in a market is prohibited in the Channel Islands and the consent of CICRA may be required in respect of a particular transaction. This is particularly relevant where a local business intends to merge with another, however, there are many different types of transactions that should be notified to CICRA for approval, both in terms of size and sector type and, if approval is needed, there are various timing considerations to take account of.


Jersey applies a standard zero rate of corporate tax. A higher rate of 10% is levied on regulated business established in Jersey, such as banks and trust companies. Utility companies and rental income and property development companies are taxed at 20%. Non-financial services companies are zero-rated. There are certain "look through" provisions applicable to locally owned businesses so that local beneficial owners pay tax on their business income at the standard personal tax rate of 20%.

However, Jersey companies may be considered exclusively tax resident in another jurisdiction where they are centrally managed and controlled outside Jersey, are tax resident in the jurisdiction of control and management and where the rate of corporation tax in that jurisdiction is 20% or higher.

A Goods and Services Tax (GST), currently 5%, is payable on the domestic consumption of imported and locally-produced goods or services unless those goods or services are categorised by law as "exempt" or "zero-rated". Certain entities qualify as "International Services Entities", allowing them to avoid registering for GST, charging GST on their supplies, and, in most cases, paying GST on supplies made to them. Finally, there is no capital gains tax in Jersey.


Under the Control of Housing and Work (Jersey) Law 2012 (the CHW Law) anyone establishing a new undertaking in Jersey must obtain a licence, subject to a number of limited exceptions. Licences under the CHW Law are administered by the Population Office, which will consider the demands on the resources of Jersey and the protection of its integrity and reputation.

Licences issued under the CHW Law contain the undertaking's quotas for employees, which may be Licenced (essentially employed) and Registered (less than five years' continuous residence in Jersey). There are no quotas for Entitled (Jersey-born with ten years' aggregate residence or ten years' continuous residence) or Entitled for Work Only (five years' continuous residence) persons.

Work permits are not required in Jersey for employees from the UK or other EU/EEA countries. Permits will, however, be required for employees from further afield under the Immigration (Work Permits) (Jersey) Rules 1995 and there are normally certain restrictions apply on duration and renewal.

Jersey's employment law includes provisions for unfair dismissal and redundancy rights. An employer must provide an employee with a statement of his/her rights including, for example, level and frequency of pay and holiday entitlement and any changes must be notified to the employee. There are also provisions covering minimum periods of notice for termination of employment, permitted deductions from salary, calculation of continuous employment on transfer of undertakings and social security.


There are statutory controls governing the ownership and use of accommodation by non-local residents. There is some unrestricted accommodation but it is limited in supply. Broadly speaking, it will only be possible for someone who has not lived in Jersey for at least ten years to occupy restricted accommodation if that person has the benefit of a Licensed post for the purposes of the CHW Law. If a new or existing business needs to acquire accommodation in Jersey, specific legal advice should be obtained on any lease or purchase of premises.


Data protection is governed by the Data Protection (Jersey) Law 2005 which has placed Jersey's law on a similar footing to that of the UK and the rest of Europe. This law requires, in effect, every data controller processing or controlling an individual's personal information to register on the Data Protection Register. Anyone processing personal information must comply with eight enforceable principles of good information handling practice, for example, as to fair and lawful processing. Employees and other individuals have certain rights including rights of access to their personal data and the transfer of this data to countries outside the EEA is restricted unless the receiving country has adequate data protection for the individual.

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.