Jersey And Guernsey Commit To OECD

by Caroline Maxwell, Tax-News.com, London

28 February 2002

The Channel Island jurisdictions of Jersey and Guernsey announced yesterday that they have come to an agreement with the Organisation for Economic Cooperation and Development, just hours before the multilateral organisation's deadline for commitment on tax reform and transparency initiatives.

In a joint statement, the Islands revealed that: 'Following clear recognition from the OECD of the essential importance of a level playing field, Guernsey and Jersey have agreed to reflect the OECD's principles of exchange of information and transparency both in a general political commitment and in tax information exchange agreements to be negotiated with individual jurisdictions.'

The jurisdictions stressed in the statement that in both offshore centres there are already information exchange provisions in line with OECD recommendations on criminal tax matters in place. However, echoing the sentiments of Bahamas Financial Services Board CEO, Wendy Warren, who also spoke yesterday on the subject of equality of treatment, they expressed concerns that the 'level playing field' is not, in fact, all that level.

The statement pointed to the fact that OECD members such as Switzerland and Luxembourg are refusing to endorse the harmful tax practices process as an illustration of this point.

Reacting to the news, the Chief Executive of Jersey Finance (an official body established by the Government to promote the jurisdiction as an international finance centre), Phil Austin commented that:

'We are delighted that agreement has been reached. Our finance industry is happy with the terms of this agreement, which properly protects its competitive position in the global finance market.' However, Mr Austin did stress that the financial sectors of both jurisdictions would expect Jersey and Guernsey to be fully involved in the international decision making process over tax and transparency requirements.

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