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January Industry News Round-up

2019 has got off to a flying start for Guernsey’s finance sector; here is our monthly newsletter with all of January’s top stories from the industry and our member organisations.

Don’t forget to follow @GIBAGuernsey on Twitter for updates and news throughout the month.

BUSINESS NEWS

Looking Ahead With the Guernsey Finance Industry Update

Guernsey Finance’s annual industry update informed the local finance industry on progress made in 2018 and plans for next year at its annual Industry Update on Thursday 24 January.

The event offered a broad overview of the business and political climate in financial services nationally after a tumultuous year and updated attendees on the agency’s activities in business development, strategy, off-island PR and marketing.

If you missed the event, you can review the presentations here.

Guernsey Drafts World-First Laws on Smart Contracts

Guernsey has drafted new laws to offer certainty regarding the use of electronic agents in transactions and contract matters and to create a secure environment for the exploitation of technology for specialist financial services.

The Electronic Transactions (Electronic Agents) (Guernsey), 2019, Ordinance aims to offer greater certainty in the use of artificial intelligence and distributed ledger technology, and to encourage adopters of technology solutions to use Guernsey.

TISE Breaks Records With New Listings in 2018

There were 865 new listings on the International Stock Exchange (TISE) during 2018.

This represents an increase of 160 (22.7%) on 2017 and is the largest number of securities listed in a calendar year on the Exchange since the business was established in 1998.

It took the total number of listed securities on TISE to 2,857 at the end of December 2018. A number of firms joined as Listing Members of the Exchange during 2018, including ILS specialist Solidum Re (Guernsey) ICC Limited, Isle of Man-based FIM Capital and, in Jersey, Intertrust Securities, as well as Maples and Calder.

Finance Sets Out Key Messages to Promote Guernsey

How we all talk about the jurisdiction can make a big difference to how it’s perceived by clients and our colleagues in other locations.

Guernsey Finance has collaborated with industry representatives to produce a set of core messages which define and differentiate Guernsey’s financial services industry.

GUERNSEY GREEN FUND

Global Asset and Risk Manager Receives Guernsey Green Fund Designation

Insight Investment, a global asset and risk manager, has become the latest manager to seek a Guernsey Green Fund designation for one of its funds.

Insight received a Guernsey Green Fund accreditation for its farmland fund, the Global Farmland Fund Limited (GFF), which invests in farming projects worldwide.

BREXIT

Gavin St Pier Issues Statement Detailing Guernsey’s Preparedness for Brexit

In the absence of the UK approving a Withdrawal Agreement regarding Brexit, Gavin St Pier, President of the Policy & Resources Committee, has issued a lengthy statement detailing Guernsey’s preparedness.

Key points included:

The opportunity for Guernsey to join the UK’s membership of the World Trade Organisation (WTO) is being actively pursued – with a meeting with Dr Liam Fox next week “to progress this matter to a conclusion.”
Guernsey has adopted legislation based on the EU General Data Protection Regulation (GDPR) and has been granted adequacy status by the EU Commission. This will not change as a result of Brexit.
With many businesses not wanting to have discussions about Brexit in public, Gavin St Pier is encouraging businesses to make contact for information and support.

Financial services businesses should make contact with Darren Stephens in the Finance Sector Development team via the gov.gg website contact page.

The full statement can be read here.

GIBA NEWS

GIBA would like to thank James Travers for his work as GIBA Council Secretary and inform members that Carl Rosumek has assumed those responsibilities as well as his duties as the council’s technical resource.

GIBA Chair Discusses the Future of the Financial Sector

Guernsey Press Q4 Business Review touches on substance, public registers, Brexit, economic growth for Guernsey and much more.

David Oxburgh, GIBA Chair, also offers his views on Guernsey’s stability as a jurisdiction, alongside the future of the local banking sector.

GIBA Council Meeting

The latest summary of GIBA council meeting minutes is now online in the members’ area of our website.

FINANCE IN THE COMMUNITY

The charitable work done by Guernsey’s finance sector continues to support many people, groups and services in the community. Follow our Twitter feed and the hashtag #GsyFinance4Community, here are just a few examples:

Loud Tie Day

Bowel Cancer Guernsey received some fantastic support from the industry for its annual Loud Tie Day and inaugural Skipton Smith Street Dash which saw teams from Louvre Group, Ravenscroft and Equiom Group take part.

Saffery Rotary Walk

A fantastic 23 local charities will benefit from this year’s Saffery Rotary Walk. It’s the sixth year that the accountancy firm has sponsored the fundraising event.

FEBRUARY DIARY DATES

14 February

ILS Insight London

Information and tickets

25 February

Compliance Briefing: Guernsey’s AML/CFT Handbook Updates

Information and tickets

26 Feb – 1 March

Super Return International

Information and tickets.

Banking Sector – Is the Future Brightening?

David Oxburgh, Chair of the Guernsey International Business Association

Guernsey’s banks remain a vital part of the island’s finance sector, with total deposits of over £90 billion being reported in the most recent statistics published on 30th September 2018.

The 23 banks in Guernsey, which employ over 1,600 island residents, are either branches or subsidiaries of the UK or international banking groups and form the backbone of our local finance sector.

The industry is hugely different now to what it was when I started working in the City more than 30 years ago, but it’s the last decade since the financial crisis where the change has been most marked.

The extremely low-interest-rate environment for much of the period since the financial crisis has necessitated considerable changes in the business models of banks, both here and internationally. Indeed although we’ve had negative interest rates in several currencies for a number of years now, I still struggle with the concept that both banks and their customers are charged interest for holding deposits in currencies such as euros and Swiss Francs, rather than receiving interest on their deposit.

When banks started being charged for holding deposits in certain currencies, it certainly made me wonder whether banking was the business to be in, but as I’ve said, business models have been changed and the industry locally has been fairly resilient through the prolonged low-interest rate environment.

Now that sterling interest rates have increased a little, some of my colleagues in the sector are starting to look slightly less gloomy than usual! However, deposit-taking for many remains a largely unprofitable activity and for this reason, some of the local banks have been increasing their minimum balance requirements or services fees, or are requiring some profitable business, such as assets to manage, to support the provision of banking services.

These conditions, of course, have had a knock on effect to other parts of the sector and are resulting in some fiduciary providers reviewing their models for banking and investment management providers.

When reviewing the Guernsey Financial Services Commission’s (GFSC) statistics for banking it is interesting to note that whilst many of the asset categories are relatively stable, there has been a steady increase in the amount of residential property lending provided by Guernsey banks in recent years with £6.3 billion of such lending in September 2018 compared with £4.4 billion in September 2014.

As in many parts of Guernsey’s finance sector, there is an increasing focus on developing and improving digital channels and on innovating more generally. In my mind, that’s encouraging as Guernsey’s finance sector, and in turn, the island’s economy and the government’s tax take, does best when we’re innovating. Our relatively small size and the close working together of industry, government, the regulator and the promotional agency should allow us to be agile and capitalise on opportunities as they come along.

The financial sector policy framework published in the Autumn set out an approach to creating leadership for Guernsey’s finance sector built on a range of global specialisms. The five key action areas are:

– Green and sustainable finance

– Family office and private wealth services

– Fintech: electronic AML and distributed ledger technology

– Funds: global distribution and product development

– Wealth management, investment and brokerage services

The first area of focus has been on green and sustainable finance. We’re just getting started, and already Guernsey has the world’s first regulated green fund regime, the International Stock Exchange has launched TISE Green, and the regulator is consulting on green insurance. It’s clearly early days but initial signs are encouraging, so I’m hoping the co-ordinated and targeted approach on the five areas I’ve outlined will help deliver the intended growth and sustainable long term future for the finance sector, of which the banking sub-sector is such an integral part.

Taking this together with the stability we offer as a jurisdiction at this time of uncertainty and change I believe the future for Guernsey’s banks and its finance sector as a whole is positive – and more so than it has been for some time now.

Economic Development and Guernsey Finance Publish Finance Sector Policy Framework

The Committee for Economic Development and Guernsey Finance have today published a Policy Framework to support the growth of Guernsey’s finance sector.

The Policy Framework lays out a clear approach to positioning Guernsey as a financial services jurisdiction, and to supporting the finance sector in creating growth and developing a sustainable long-term future for the sector. It forms part of the economic development strategy set out by the Committee for Economic Development and approved by the States in June 2018. It has been developed by Guernsey Finance in partnership with businesses, with the support of the Guernsey International Business Association and its member associations, through working groups comprising industry, government and the regulator to ensure a consistent and common jurisdiction-wide approach

The Policy Framework sets out an approach to create leadership for Guernsey’s finance sector built on a range of global specialisms. It will build on the qualities and strengths that have made Guernsey a successful global finance centre. It will also enable government, Guernsey Finance, industry and regulator to work together to put in place the necessary elements for Guernsey’s continued success in global financial services.

In line with the economic development strategy, the priorities remain:

1. Green and sustainable finance;

2. Family office and private wealth services;

3. Fintech: electronic AML and distributed ledger technology;

4. Funds: global distribution and product development; and

5. Wealth management, investment and brokerage services.

The Policy Framework also incorporates approaches and objectives to other sectors including insurance and pensions as well as setting out a clear geographic focus for development.

Each key priority area already has an established working group and policy statements on a scope of work and objectives have either been published or will soon be published.

Deputy Charles Parkinson, President of the Committee for Economic Development commented:

“Financial services are the engine of our economy. A decade after the financial crisis and with Brexit looming, we felt it was right to review our strategy for the finance sector in Guernsey. In late 2017 the government and Guernsey Finance agreed to work together more closely to do that, the objective being to develop a strategy for the future.

“This Policy Framework for financial services is the outcome of that work. It sets out our priorities, principles, objectives and approach to deliver continued growth and innovation in the sector going forward, and demonstrates that Guernsey remains a premier league finance centre that is avowedly open for business.”

Lyndon Trott, Chairman of Guernsey Finance said: “Guernsey’s specialist finance sector plays an important role in the global economy. We connect global investors and markets, successfully facilitating international capital flows and trade. We have proven our credentials as a responsible, global finance centre time and time again, and possess an impeccable track record and commitment to transparency.

“The global economy continues to provide challenge and opportunity. Competition is fiercer, the regulatory environment tougher. We are not complacent because we know that to remain successful, we must ensure that we continue to create the best conditions on island for firms to succeed. To do that, it is important that we set out this clear strategy for future competitiveness.”

David Oxburgh, Chairman of the Guernsey International Business association (GIBA) said:

“The new policy framework and the work streams within it have been informed through close engagement with industry on opportunities for the finance sector. GIBA and its members welcome this approach, and although the Policy Framework is being formally published this week, work is already moving forward – for example on green finance.

“The finance sector is the engine of the Guernsey economy, creating jobs and generating revenue to fund our island’s public services. GIBA welcomes the approach of Guernsey Finance and the Committee for Economic Development to build a partnership with industry in order to grow the finance sector, which in turn will deliver sustainable benefits and prosperity to Guernsey.”

A steering group, chaired by Andy Sloan, Deputy Chief Executive – Strategy, Guernsey Finance, will:

· Advise on the ongoing development of strategy and recommended policy developments in meeting the objectives of the policy framework;

· Review progress on the actions set out in the policy framework; and

· Report on progress to the Committee for Economic Development and the Finance Sector Forum, the regular monthly meeting which brings together the finance sector and government.

This group will also look to ensure that its approach is aligned with the work of the various government steering groups in other areas such as Digital Guernsey. The steering group’s first meeting will be in January 2019.

November Industry News Round-Up

GREEN FINANCE STRATEGY PUTS DOWN ROOTS

Guernsey Participates in the Launch of UN’s FC4S European Green Finance Network

The United Nations’ Financial Centres for Sustainability (UN FC4S) launched its European arm this month in Dublin, Ireland, with Guernsey one of nine financial centres involved.

The new European network, which has its base in Dublin, sees Guernsey join other leading financial centres including London, Frankfurt, Paris and Zurich, in a broader European commitment to sustainable finance.

Green Insurance in Guernsey Discussion Paper

Guernsey Financial Services Commission (GFSC) has launched a discussion paper considering how the Bailiwick could become a supportive jurisdiction for green insurance.

The paper covers regulatory changes in addition to wider sectoral issues relevant to the local insurance industry.

The closing date for responses to the paper is 29 March 2019.

Read the paper

TISE Launches Green Market Segment

The International Stock Exchange (TISE) has recently announced the launch of a new green market segment, TISE GREEN.

The segment has been established to enable those seeking investment in environmentally beneficial initiatives to highlight their green credentials. It also aims to provide easier access for investors who are looking to allocate towards those investments which have been verified as meeting globally recognised standards in green finance.

BUSINESS NEWS

Guernsey Responds to Economic Substance Concerns

In 2016, the EU Council committed to coordinated policy efforts in the fight against tax fraud, evasion and avoidance. The Code of Conduct Group was instructed to undertake a screening process whereby jurisdictions, including Guernsey, were assessed against three standards in respect of tax transparency, fair taxation, and compliance with anti-Base Erosion and Profit Shifting (“BEPS”) measures.

Guernsey has responded to these concerns by publishing draft regulations and initial key aspects guidance. A copy of the draft Income Tax (Substance Requirements) (Implementation) Regulations, 2018 can be found here.

GFSC Issues Handbook on Countering Financial Crime

The Guernsey Finance Financial Commission (GFSC) has issued, in final draft form, the revised Handbook on Countering Financial Crime and Terrorist Financing.

The revisions to the rules and guidance in the Handbook, together with revised legislation, will bring the Bailiwick’s AML/CFT framework into line with international standards issued in 2012 by the Financial Action Taskforce. It also addresses recommendations made by MONEYVAL following its mutual evaluation of Guernsey.

Guernsey to Secure New Customs Union with UK

Guernsey’s fiscal independence will be secured through a new customs deal with the UK – which will also help ensure businesses benefit from ‘frictionless’ trade after Brexit.

Home Affairs Vice-President Deputy Rob Prow, who has led the work on the new customs union agreement between the UK and the three Crown Dependencies, is positive about the new arrangements which mean there will be no trade barrier between Guernsey and the UK.

Guernsey Hosts Channel Islands 5G Summit

The regulator, representatives from the various telecos and government and industry representatives came together to discuss the introduction of 5G to Guernsey.

Many of the positive aspects of 5G connectivity were discussed during the day, including the ambition that it will help the island improve productivity, create the conditions for the Internet of Things to develop and support more technological innovation in Guernsey.

Private Wealth Forum Highlights Guernsey as Major Base for Family Office Moves

Guernsey is increasingly being considered as a base for family office structures, an expert in the sector told the first-ever Guernsey Private Wealth Forum in London.

Guernsey’s commitment to tax transparency and sharing information – while still offering privacy – is seen as a positive differentiator for the island.

GIBA NEWS

Technical Report

GIBA’s latest technical status update is now online in the members’ section of our website:

If you need a password to access this area, please get in touch!

GIBA supports Skills Guernsey’s New Action Plan for a Highly Skilled Workforce

GIBA looks forward to contributing to the development of a financial services apprenticeship scheme and also to playing its part in encouraging local graduates to return and join the island’s workforce.

The Action Plan has been shared with industry groups throughout its development, to gain insight from businesses and understand how they may be interested in working in collaboration with Skills Guernsey.

FINANCE IN THE COMMUNITY

Our Twitter feed this month has been busy with events and activities being sponsored by firms in the finance sector and related professional services.

Check them out using the hashtag #GsyFinance4Community, and you’ll see what incredible support the industry gives our community. Here are just a few examples:

Beard Up for MUG

Male Uprising Guernsey’s annual Beard Up event has seen a wealth of support from the finance community throughout November. Northern Trust, Louvre, Carey’s Richmond Group and BDO Guernsey have all sported facial hair in support of the charity.

Arts for Impact

Generali Worldwide has teamed up with local charities Arts for Impact and Art for Guernsey to help improve the patient experience at Princess Elizabeth Hospital.

Guernsey Community Foundation Awards

Fantastic work by people and organisations within the finance community was recognised at the Guernsey Community Foundation Awards. Congratulations to all the winners and those shortlisted.

DIARY DATES

D&O Insurance: Same Old Cover – New Risks?

13th December

St Pierre Park

The Guernsey Investment Funds Association seminar will examine the cover and liability management in today’s market.

Guernsey Finance Industry Update

24th January

St James

The event’s keynote speaker Miles Celic, Chief Executive of TheCityUK, returns for a second year, alongside Guernsey Finance speakers Chief Executive Dominic Wheatley, Deputy Chief Executive, Strategy, Dr Andy Sloan, and Marketing Director Barnaby Molloy.

To share your event news and community activity on GIBA’s social media channels, please send information and images to hello@black-vanilla.gg.

October Industry News Round-Up

GIBA NEWS

Implementation of States Economic Development Strategy

David Oxburgh, welcomes the recent update published by the Committee for Economic Development (CfED) on the implementation of the States of Guernsey Economic Development Strategy and is encouraged by the prioritisation of the 20 growth actions.

He says: ‘GIBA is encouraged that the 20 actions to promote stronger growth’ have been categorised as critical, important or beneficial.

‘In particular, we are pleased that GIBA’s three main focus areas of transport links, skills and growing and developing the finance sector are all regarded as critical. The other three action areas which have been categorised as critical are the digital, telecoms and the seafront enhancement area.’

Read David’s full statement here

Technical Report

The latest GIBA technical status report is now online in the members’ area on our website. If you need a login, please get in touch secretary@giba.gg.

Don’t forget to follow @GIBAGuernsey on Twitter for updates and news throughout the month.

BUSINESS NEWS

Guernsey Agribusiness Fund Becomes World’s First ‘Regulated Green Fund’

Guernsey has registered a Guernsey-domiciled agribusiness fund as the world’s first regulated green fund.

The Cibus Fund, launched last year, becomes the first fund to be awarded the Guernsey Green Fund regulatory “kitemark” by the island’s regulator, the Guernsey Financial Services Commission, following the launch of the Guernsey Green Fund rules in July this year.

Dr Andy Sloan Discusses Guernsey’s Global Positioning

At a recent IoD seminar, Guernsey Finance’s Dr Andy Sloan announced that a ‘clarity and definition of the islands positioning’ was needed to make the island’s financial services sector relevant and successful in a post-2020 world.

He said it was time for: ‘a very deliberate positioning or re-positioning of ourselves as a sophisticated and specialist global finance centre.’

More news about the key messages and strategy he discussed will be available shortly but, in the meantime, he urged the audience to consider Guernsey as a specialist global finance centre servicing sophisticated global clients.

Guernsey PIF is a ‘Great Fit’ for ‘Non-Traditional’ South African Fund

The launch of a new Private Investment Fund in Guernsey from a South African manager is the latest of what is hoped could become a pipeline of fund launches from the country.

Guernsey Finance and industry practitioners were in Cape Town this spring promoting the island’s funds offering, including the popular Private Investment Fund, introduced in late 2016.

TISE updates Listing Rules to Attract Scale-Up Businesses

The International Stock Exchange (TISE) has revised its Listing Rules for trading companies, in particular, to appeal to Small and Medium Sized Enterprises (SMEs).

TISE has a long-term strategy of attracting more listings from growth companies based in the UK as well as its ‘home’ markets of the Channel Islands and the Isle of Man.

FINANCE IN THE COMMUNITY

Our Twitter feed this month has been busy with events and activities being sponsored by firms in the finance sector and related professional services.

Check them out using the hashtag #GsyFinance4Community, and you’ll see what incredible support the industry gives our community. Here are just a few examples:

Biggest Swimarathon to Date

This year’s Skipton Swimarathon saw around 3,000 people taking part in the fundraising event, 1,000 more than last year’s record-breaking figure.

The main beneficiary this year will be Le Murier School’s Village Project. Money raised will go towards the building of four log cabins designed to help the students learn independent living skills.

Children, Parents and Teachers Enjoy Free Football

78 children, parents and teachers from La Mare Primary and La Mare High School took advantage of the free tickets provided by Aspire Guernsey in the Guernsey FC Aspire Youth Zone and witnessed an eight-goal thriller.

#BeardUp for MUG

The charity’s annual beard-growing fundraiser kicks off on Thursday 1st November. Weighbridge Trust has already pledged its support, and no doubt other firms will follow.

Chairman of MUG, Dan Collins says: ‘The financial services sector has always been a big supporter of MUG’s various male cancer awareness campaigns and fundraising activities. Beard Up is no exception and we encourage as many firms as possible to get involved and grow some facial hair this November.

‘Without everyone’s support, the charity could not carry on its work to help male cancer patients and spread our #GetChecked message.’

Sign up here

DIARY DATES

Monday 5th November – Disclose or Be Dammed

STEP Guernsey welcomes Michael Cash and Henrietta Mason from Penningtons Manches LLP who will review the recent English case of Lewis v Tamplin and the current state of the law on the rights of beneficiaries to information. They will examine the request by trust beneficiaries for more information about the trust, the actions taken, outcome and implications for trustees to consider.

Venue: The Dorey Room, St James

Time: 12:00 – 13:00 pm

For more information and to book your place click here

Wednesday 7th November – Following the Money
The Financial Intelligence Service in conjunction with the Policy & Resources Committee invite you to a presentation by Clark S Abrams, Chief, Money Laundering and Financial Investigations Unit at the Office of the Special Narcotics Prosecutor for the City of New York.

The presentation will focus on how financial services businesses can help prosecutors to crack down on the global drugs trade and will include:

Trade Based Money Laundering (TBML); Fraudulent trade documents and alternative payment systems
KYC; The antidote to money launderer’s sleight of hand
Be aware, or beware, of civil forfeiture (confiscation)

Venue: OGH, Regency Room

Time: 11:00 – 12:15 pm

For more information and to book your place click here

Thursday 8 November – Guernsey Private Wealth Forum

The first ever Guernsey Private Wealth Forum takes place next month, discussing political risk and its impact on private wealth.

The event will feature a keynote speech from Sir John Sawers, a former diplomat, followed by an afternoon tea. Session two will consist of a panel discussion of professional advisers to wealthy individuals and their families.

Venue: Graysons Christ Church Spitalfields, London

Time: 2:00pm – 5:10 pm

For more information and to book your place click here

Wednesday 14 November – Collas Crill Director’s Duties Conference

Collas Crill will be hosting a conference on directors’ duties during the life cycle of a company. From local cases, such as Carlyle to the much-publicised UK examples of BHS, Carillion and Sports Direct, the role of directors and the importance of corporate governance is an increasingly scrutinised subject.

Venue: Duke of Richmond Hotel

Time: 8.30am

Wednesday 14 November – Mourant Privilege Seminar

Mourant is hosting a privilege seminar with regulatory specialists, Robert Shepherd and Sally French.

The seminar will consider the SFO v Eurasian Natural Resources Corporation Ltd case. This case concerned documents created by a company investigating a whistleblowing complaint and whether the SFO was entitled to see those documents for its own enforcement action.

Venue: The Upper Rotunda, Royal Chambers

Time: 8.00am

Thursday 15 November – KPMG Tax breakfast seminar

Introduction of substance requirements for certain Guernsey tax resident companies.

The event is an opportunity to hear from KPMG on how the proposed changes may impact local companies. Speakers will provide insights on which companies are affected, what such companies need to do to comply with the proposals, the increased reporting required by companies, and finally what happens if everything goes wrong, which could ultimately result in the company being struck off.

Venue: KPMG, Glategny Court, Glategny Esplanade

Time: 8.00am

For more information and to book your place email gg-fmtaxeventsgsy@kpmg.com

To share your event news and community activity on GIBA’s social media channels, please send information and images to hello@black-vanilla.gg

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