The recently-published 2009 annual report of the Labuan Financial Services Authority (Labuan FSA) showed substantial growth in all the key financial activities pursued in Labuan, despite the global economic recession during the period.
In particular, leasing out of the Labuan International Business and Financial Centre (LIBFC) was the business sector which performed the best, growing strongly with leased assets rising by almost 24% to USD21.9bn. Much of the increase was seen in the leasing of floating production platforms and offshore support vessels for the oil and gas sector, but a rise in activity was also experienced in aviation business.
Furthermore, with an increase of almost 9% in 2009, insurance premiums written in Labuan reached over USD1bn for the second successive year.
As at the end of 2009, the banking sector in Labuan had total deposits and loans outstanding of USD10.2bn and USD18.6bn respectively, and the banks themselves recorded a 16.6% increase in combined profits during the year. It was emphasized that the banking system in Labuan remained sound, with a continued vigilance against money laundering and similar activities.
Of note in 2009 were the new laws which have substantially improved the regulation and development of Labuan’s international financial markets. An additional clause to the Labuan Offshore Business Activity Tax Act, which is now known as the Labuan Business Activity Tax Act, has enabled the adoption of the Organization for Economic Cooperation and Development standard for the exchange of information for tax purposes in double taxation agreements.
Comparable changes have also taken place in the laws governing the creation of Labuan foundations, limited liability partnerships, protected cell companies (insurance and mutual funds), shipping operations, Labuan special trusts and financial planning activities.
Ongoing robust regulation of the LIBFC by the Labuan FSA should ensure its continued development as a regional platform for international investments.
A comprehensive report in our Intelligence Report series tracing in detail the course of the last six years both globally and at jurisdiction level, explaining precisely what you get - and don't get - for your money in all of the main offshore jurisdictions, is available in the Lowtax Library at http://www.lowtaxlibrary.com/asp/subs_reports.asp and a description of the report can be seen at http://www.lowtaxlibrary.com/asp/description_report1.aspTags: tax | law | offshore | investment | agreements | banking | financial services | insurance | international financial centres (IFC) | Labuan | oil and gas | regulation | services
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